America is facing a make or break moment for the middle class. President Obama strongly believes in building an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules. This core belief is why the President proposed the Buffett Rule which advances the basic notion that those making more than $1 million per year, should pay at least the same percentage of their income in taxes as middle class families.
Unfortunately, just last week, Senate Republicans blocked this common sense proposal despite the fact that Americans of all backgrounds support this plan. One proponent with a unique perspective is Nevada State Treasurer Kate Marshall, who had this to say in the Reno Gazette Journal:
This piece of legislation was meant to even the playing field and have everyone pay their fair share. Simply put: "If you make more than $1 million a year, you should pay at least the same percentage of taxes on your income as middle class families do"…
According to a recent report by the Congressional Research Service, about 25 percent of families earning more than a million dollars per year pay federal taxes at a lower rate than some middle-income taxpayers. This is predominantly due to the special treatment of investment income and the reduced impact of payroll taxes on high earners. Closing these loopholes would raise approximately $160 billion under current law.
Warren Buffett supports it, as do many other successful Americans. They know that if people like Buffett keep getting a tax break they don’t really need and that the country can’t afford, it either adds to the deficit or someone else is going to have to pay for it. That someone else is likely the middle class.
If we want to start reducing the deficit, we need to start dealing with the decline in real per-capita federal revenues, and we should do this fairly. As President Obama has said, "This is simple math. The Buffett Rule is one step among many we need to keep investing in prosperity for all Americans without increasing the deficit."
You can find out how many millionaires pay a lower effective tax rate than you here.
James Schuelke is a Staff Assistant in the White House Office of Intergovernmental Affairs