Posted By Randy Jones on February 26, 2009
The Wall Street Journal has a great opinion piece today on the fallacy of President Obama‘s plan to raise the much-needed governmental revenues to institute his economic recovery plan. They call it the “2 Percent Illusion.” See this link: http://online.wsj.com/article/SB123561551065378405.html. The Journal points out that if you look at 2006 IRS data—the most recent year for which such tax data are available, and coincidentally a good year for the economy and “the wealthiest 2%”—there is no way that further soaking of the rich can fund his rescue plans. The data suggest that there were approximately 3.8 million filers with adjusted gross incomes more than $200,000, representing 7 percent of all returns. These $200,000-plus income earners forked over $522 billion to the IRS, representing 62 percent of total U.S. income tax receipts. There was no breakout in the data for the $250,000 earners targeted by the president. The article does point out that the richest 1 percent—about 1.65 million filers making above $388,806—paid $408 billion, or 39.9 percent of all income tax revenues, while earning about 22 percent of all reported U.S. income. Further taxing the top 2% hits the owners of small- and medium-size businesses, the very folks that should be leading us to recovery, right in the gut of their wallets. I want to believe the president can do all that he says he can do—stimulate the economy, fix health care, and lower the federal deficit by half. It would be a stunning achievement. I almost always feel better about our country after his oratory, but there has got to be a better solution than further taxing America’s employers, the very engine of American commerce and the key to our recovery. Do you have a better solution?