Is All "Fair" With the Obama Agenda?

President Obama and congressional Democrats are avidly pursuing a sweeping agenda they claim is justified by the need for greater "fairness." This invites scrutiny of the various programs to verify if they do, in fact, promote fairness.

"Free from bias, dishonesty, or injustice" is the standard meaning of fairness, which requires treating people similarly, perhaps not identically, but certainly not with purposeful difference. Apply this test to the tax changes proposed in President Obama's budget, and it seems clear he wants to punish higher-income earners for the benefit of others, namely lower and middle-income earners.

Let's understand the pre-Obama tax status quo. In 2006, the most recent year for which comprehensive IRS statistics are available, there were 135.7 million tax returns with a total of $8.1 trillion in income (technically called adjusted gross income) and a total of $1.0 trillion paid in income taxes after consideration of tax credits.

The top one percent of earners claimed 22.1 percent of all the adjusted gross income that year, but they paid 39.9 percent of all income taxes.

In other words, the richest of the rich in 2006 paid nearly double the proportion of their income in income taxes. Such a disproportionate burden makes it tough to argue that the tax system is rigged to benefit the rich.

Perhaps more striking is the burden placed on the 13.8 million earners who represent the top 10 percent of Americans. In 2006, the top 10 percent earned almost half of all the income (47.3 percent) but paid a full 70.8 percent of all income taxes. Put differently, 13.8 million taxpayers paid almost three-quarters of the entire income tax bill in 2006.

Another way of looking at the burden of income taxes is by the average tax rate faced by different groups. The average tax rate (ratio of income taxes after credits to adjusted gross income) for the top one percent was 22.8 percent. For the top 10 percent it was 18.9 percent. For the bottom 50 percent it was a near non-existent 3.0 percent. The figures make it abundantly clear that income taxes, the largest source of government revenues, are markedly punitive the more one earns.

The normal response from those who want yet higher taxes on the wealthy is that lower and middle-income earners also pay payroll taxes, which is true. However, payroll taxes largely go to fund what is supposed to be a social insurance fund. The grand bargain behind the program, as espoused by FDR, is that people pay into the fund and then receive a near-proportionate benefit. Those arguing for reform of payroll taxes are essentially promoting the abandonment of that grand bargain in order to achieve even greater redistribution of income.

It is a strange concept of fairness that requires some people to pay more taxes so others can benefit from programs they no longer pay for. Consider also the radical plan to shift power away from workers and employers to unions, known as the Employee Free Choice Act.

In the name of fairness, this bill eliminates the requirement for a secret-ballot vote to approve the installation of a union, which is considered a mainstay of fair elections and a protection against retaliation. In other countries, such measures have proven to be a bonanza for union bosses but costly for average workers and the economy as a whole. Thus, on union membership, payroll taxes, and income taxes, the administration's policies fail the basic fairness test.

President Obama is a man of boundless eloquence but proclaiming a policy to be fair does not make it so. To achieve the brighter future the President and everybody else wants will require a different and decidedly fairer approach.

The top one percent of earners claimed 22.1 percent of all the adjusted gross income that year, but they paid 39.9 percent of all income taxes.

I'm so tired of this argument, not only because it is NOT fair or representative, but because it is politically stupid.

You won't convince anybody NOT paying taxes that it would be more fair if they carried more of the burden. That's all they see with this kind of data byte.

Here is the reality: By the time the poor pay Social Security and MediCare taxes, sales taxes, taxes in the products they buy, and property taxes in their rent, they probably pay MORE taxes as a percentage of their income than the rich do, particularly those wealthy who shelter their incomes.

Those tax programs are ALL welfare traps, supposedly freebies proffered by their "friends" in the Slave Party. Talking about that's is where you'll get the attention of people whose political support we need to win on conservative principles.

You fail to take into account that the wealthy also pay SS and medicare taxes, sales tax and property tax.

Though a rich person MIGHT have SOME more tax deductions, they also have higher taxes. If that "rich" person is self employed thet have to pay TWICE as much in SS and medicare taxes. If they are an employer, they have to pay SS and medicare taxes for each employee. So whatever person A pays in SS and Medicare taxes on his check, his "evil rich" employer has to match.

Also, the wealthier person might have more disretionary income, and may dine out more, which means paying MORE tax. Maybe they attend more baseball games, there would be more taxes incurred.

Maybe a less affluent person can only buy 1 used car, but a wealthier person can buy 2 new cars. He'll pay higher taxes on each of the cars than the poorer person. He also has to buy more licenses and vehicle stickers.

When they buy groceries the poor person might buy hamburger at $1.95 a #, where the rich person might be buying sirloin at $5.95 a #. Higher taxes again for the rich person.

They were, but I believe the caps have been removed or “restructured”.

No. It's been proposed, but not enacted.

Still doesn’t deal with if they are self employed, which means they pay twice the percentage as the typical employee.

Bull. Just because the tax is hidden doesn't mean the employee isn't bearing it. The reason is simple, the employer elects to pay that tax upon the decision to hire. No hire, no tax. The employer accounts that tax as part of the cost of an employee. Thus, he decides it is worth the tax to make the hire. It's what he pays for an employee.

You could just as easily say that the employer pays the employee's "share" of the SS/MC tax because he pays the employee, but it's bogus, because the total compensation is what he decides to spend to get the hire. Thus, the employee effectively pays that tax because it comes out of the amount the employer was willing to pay for the employee's services. It is effectively hidden as any decent economist or accountant will tell you.

Take your kindergarten arguments elsewhere. Stop obsessing with your situation and learn to see things from the position of others. It is a much more effective way to enlist political support for conservative principles.

Lets get something straight. I'm a construction worker. No I don't own my own company. So, I'm like what 90% of everybody else, who work for someone. You, are the one with the kindergarten mindset, trying to do the loser, class warfare, argument.

Your little spiel fails in that you dismiss the employers payment of a tax. Its OK for your side of the argument for the employee, but then totally disregard the very same cost to the employer.

Granted, its a cost he factors in to his doing business, but its still a cost, and a tax that HE pays. Its a cost similar to me driving to work. Sometimes I have to drive 1-1/2 hours each way, I figure the cost of gas, the price I pay to earn a living.

Your argument also fails in this aspect, look at your W2. You are taxed x amount of dollars in each category. Those are taxes you can claim. But YOU aren't taxed the full amount, because your employer must pay the other half. If you didn't pay your taxes the government would come after you. But if the employer doesn't pay the other half of those taxes, does the government still come after you? No. Because, its a tax the employer must pay.

You work at Moms Diner and make $10 an hour and are taxed $2.50 an hour. Meanwhile Mom also must pay $2.50 for the pleasure of employing you. You clear $7.50, does Mom clear $7.50 also on your labor? NO!!! After overhead, unemployment insurance, liability insurance, and every other expense, Mom might clear $2 for every hour you work. Another part of this is that IF Mom didn't properly figure costs, the tax SHE pays must be paid first. Then she gets to figure her operating expenses and what not, and claim deductions from there.

Your whole argument is, how evil the rich guy is, and the taxes he doesn't have to pay. Well lets look at the poor person who pays 3% or less of his/her income in income tax, versus the person who's at the 33% tax bracket. SS and medicare taxes don't come close to bridging the gap.

50% of the people makeup the 3% group. Meanwhile 1% pay 22%. That means there are 50 times as many people paying the smallest amount of tax, versus those paying the largest. That means the average person pays the least while its the exception who pays more. If its the exception who pays the higher amount, what is it then for those who manage to pay little or nothing, who are also the wealthy. They are the exception to the exceptions.

But hey, It won't matter much longer. We'll all be making the same amount, paying the government the same amount, and thanking the government for its benevolence.

You'll finally be equal to all those people who worked harder and/or smarter than you. All those people who were more frugal than you, who made the most (or tried)of every opportunity. All those people who were "JUST" lucky. All those people who refused to stay at the same level.

Equality and fairness for all. All hail Obama.

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