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The Buffett Rule Obfuscates the Real Debt Crisis

By: Daniel Horowitz (Diary)  |  April 11th, 2012 at 06:36 AM  | 

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Over the past few weeks, Obama has exhibited the intensity of a Navy SEAL in his execution of class warfare.  He is trying to convince everyone that those who earn 17% of Adjusted Gross Income, yet pay 36.7% of federal income taxes don’t pay anything, while those who pay little or no taxes shoulder the entire tax burden.  Obama will continue to toss out misinformation throughout the campaign about all these billionaires that supposedly pay little in taxes.

While he is prosecuting his class jihad, we should remind him of these facts and figures:

  • Obama has accrued more debt in 3 ½ years than Bush did in 8 years – and Bush was a big spender.  When President Bush was sworn in on January 20, 2001, the total federal debt stood at $5.728 trillion.  On January 20, 2009, the day he left office, the debt had increased to $10.629 trillion, a jump of $4.9 trillion.  Just 38 months later, the debt has increased another $4.992 trillion to a grand total of $15.621 trillion (as of April 9)!
  • Amazingly, $4.577 trillion, or 91% of Obama’s debt increase comes from the public share of the debt, which now stands at $10.88 trillion.
  • We are on pace to breach the $16.394 trillion debt limit before the November elections.  That means that he will have amassed almost (or more than) $6 trillion in debt by the time he, God willing, leaves office next January.  It took from our country’s founding until 2002 to amass $6 trillion in debt.
  • The debt has increased $1.327 trillion in the past 9 months since we “solved” the debt crisis with the Budget Control Act.  That’s about as much as the top 1% of income earners make in 12 months.
  • When Obama took office, the gross federal debt was 76.5% of GDP, while the public share of the debt stood at 45% of GDP.  Now, those numbers stand at 102% and 71% respectively.
  • The debt per taxpayer stands at $137,751, up from $89,330 just 4 years ago.
  • The monthly deficit for this past February was a record $232 billion.  We didn’t start accruing annual deficits of $230 billion until this past decade.
  • In February, we spent $335 billion in 29 days.  It comes out to $11.5 billion per day; $480 million per hour.

Remember that none of this even begins to account for the $70 trillion+ unfunded entitlement liability and Obama’s new proposed spending that he wants to pay for with the “Buffett Rule.”   Even Obama claims that he understands how massive tax increases would be counterproductive and that he only wants the rich to pay “a little more” to fulfill their “fair share.”  The fact is there is no way the Buffett Rule, which would raise $46.7 billion in revenue over 10 years, will ever solve the debt crisis, even if you subscribe to the notion that we can and should raise some taxes.

Now that Mitt Romney has all but secured the nomination, he has an opportunity to combat Obama’s Buffett Rule with the Romney Rule.  Government spending should not grow faster than the private economy.  That is the only way to solve the debt crisis.  Period.

Cross-posted from The Madison Project

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COMMENTS

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  • radicalrighty

    He told Hannity that if he wins, he will probably be a one-term president, that he will drive the left crazy with the big changes he is prepared to make, to curb federal spending.

  • sigmasix

    Romney will support the Buffet Rule. The release of the trial balloon last week on taxes is a strong indicator of this. Obamalite?

  • johnt

    It will play well with leftist apes but Normal People less so.

  • spinoneone

    but the Congress should be careful. The people, regardless of the leftist/communist rhetoric spouting from 0′s mouth, do not support tax increases on themselves. The last time the Congress tried this, the Alternative Minimum Tax [AMT], they forgot to index it for inflation. It now hits everyone making more than $250,000 per year. When passed it was designed to hit about 50 people.

    Contrary to the pundits’ opinions, we are about to hit a big round of inflation.

    • tnfriendofcoal101368

      We are already in a highly inflationary cycle. You feel it everytime you fill up at the gas station or buy milk in the store. I heard it say once inflation is like air, it is there but no one really sees it. The common perception is that high gas prices drive inflation but that really is putting the cart before the horse. High gas prices are driven by factors such as global demand, certainly but supply has never been higher (well until Lisa Jackson starts poking around). The fed policy has weakened the dollar (i.e. qualitative easing) and this has caused the price of goods and commodities to soar. This is essentially a tax that is very regressive (it hits poor and low income folks the hardest) but you never hear the MSM call it for what it is and as you point out neither the Fed nor the Treasury seems in any hurry to start the backing down of QE (which is essentially a perpetual bailout but that is another story).

      • bobguzzardi

        Inflation is becoming more and more noticeable every time one goes to grocery store and fill the gas tank. There are other less dramatic examples.

        Inflation as a regressive tax is not discussed much but very real.

  • ardendulou

    RINO Dick Lugar versus TEA Party backed, conservative Richard Mourdock are debating tonight. Any coverage of this important race?

  • anjinconsulting

    We ought to use the Alinsky trolls’ own words and tactics against them. Specifically, we should use their arguments of ‘fairness’ to propose that EVERYONE pay the same tax rate, regardless of income.

    A rate of 10% on a Welfare Queen’s paycheck is the same as 10% on Warren Buffet’s paycheck. Everyone is equal but the “rich” pay more. Isnt that what these clowns want?
    .

  • jeffreywturner

    There simply aren’t enough “rich” people for tax increases on them to amount to anything more than a tiny drop in the bucket towards solving our budget woes, and defense spending as a % of our budget is already near a 70-year low.

    The hard fact is that there is absolutely no way whatsoever to balance our budget and begin to pay down our debt without major changes in entitlements, period. That needs to be repeated over and over again until it drowns out Obama’s obfuscations.

  • Repair_Man_Jack

    http://www.nationalreview.com/campaign-spot/295653/1-spending-cut-six-times-effective-buffett-rule

  • Ann_W

    It’s a pittance in the scheme of out of control spending. Where are Republican’s with some Perot graphs?

    In the meantime it would destroy hundreds of jobs created by rich people spending their own money or the increased productivity that invested savings creates.

    • Locked and Loaded

      a vacation for Michelle and all the girls and a couple of greens fees for the Failure.

      • aeaeren

        the same ole speechs about how the One is going to stop the wasteful spendimg ect. He uses the same speechs every year so it shouldn’t be hard to argue that he is completely out of his element and completely out of ideas and has no imagination whatsoever.

  • Common_Cents

    obama basically lying and deceiving that the buffett rule is the solution to our problems when it only brings in 3-5 billion a year(assuming people continue to earn the same and not pursue other tax strategy)

    or

    the Dem propaganda media not challenging him on the lunacy of the buffett rule only bringing in 0.2% of annual deficit

    or

    the sheeple actually believing this crap and not laughing this phony idiot out of office.

  • bgintn

    “It already appears, that there must be in every society of men superiors and inferiors, because God has laid in the constitution and course of nature the foundations of the distinction.” –John Adams, Thoughts on Government, 1776

  • tnfriendofcoal101368

    Mr. President if the Buffet Rule is such necessary legislation: why is it not the law of the land? You controlled both the Senate and House for 2/3 of your Presidency. You managed to get Obama Care and the Stimulus passed without nary a Republican vote. Why did you not bring the Buffet Rule before Congress in your first two years? The fact that it is not the law of the land indicates you don’t think it was important and are merely a cynical, hypocritical politician trying to distract Americans from your record. If you really do think it is important, well then you are incompetent, so which is it?

    • bobguzzardi

      The rhetoric may be appealing but it lacks political support for some reason. It is not clear that the rhetoric is not working with the voters. It seems to be.

  • http://conservativemormonmom.blogspot.com ew88

    The 1974 Budget Reform Act took the federal budget away from baseline budgeting. Each year, the budget automatically increases 10% over the previous year’s budget, regardless of necessity or tax revenue. This is why and how the federal government has grown at the rate it has. This is why the deficit spirals upward out of control. This is also why Democrats ridiculously cry ‘Draconian cuts!” every time a Republican proposes cutting the budget increase from 10% down to something smaller. People need to know about this Act so we can get rid of it and go back to baseline budgeting. There will be no deficit reduction or even stagnation without it, including all the spending cuts the GOP dreams of.
    www.conservativemormonmom.blogspot.com

  • Common_Cents

    And obama is making this a centerpiece of his campaign.

    Why doesn’t the media call him out on this?

  • justperhaps45

    When the Buffet rule takes a few million out of the invested economy how will the thus destroyed wealth creation be replaced?

    MORE TAXES=LESS INVESTED

    LESS INVESTED=FEWER JOBS

    Think unintended consequences, if you can.

  • justperhaps45

    When the Buffet rule takes a few million out of the invested economy how will the thus destroyed wealth creation be replaced?

    MORE TAXES=LESS INVESTED

    LESS INVESTED=FEWER JOBS

    Think unintended consequences, if you can.

  • Risky

    you should check your own pocket.

    You won’t raise revenue from people that can move their affairs to lower tax countries or just stop working if it doesn’t pay.

    The reason why these taxes get promoted is normally to cover the smaller tax rises on everyone else that really raises revenue.

    It’s just a distraction theft. Look at that plane…..

    • Ann_W

      Now it affects tons of people.

      • acat

        This is the difference between playing short-term and long-term ball.

        Mew

        • Ann_W

          They do a good job of acting surprised.

  • bobguzzardi

    Obama uses Marxist Alinsky Class Warfare to exploit human weakness of envy and grievance because it works so well. The President has a 40% approval rating so he is doing something right.

    • Ausonius

      When the BIG LIE is repeated often enough, the brain can start to waver, much like Republicans when they go to D.C. after they are elected as “Conservatives.” Suddenly they want to play nice with the Dems, i.e. the playground bullies.

      Repeat the lies to America often enough and you will change the nature of the country: repeat the lie that government is the solution, that Capitalism has failed, that free markets don’t work, that “you’re on your own” if Republicans have their way. that anyone who has become wealthy cannot really be honest, that if you are poor it is become somebody has taken away your money and/or chance to succeed, that churches and their morals are oppressive, and that egalitarian FAIRNESS in as many things of life as possible is better than simply “equality before the law.”

      Repeat these lies for 40 or 50 years and you end up with BIG BRObama as president, a man with no real qualifications and no real achievements. But look at how he has succeeded with those lies as his basis.

      Sometimes the good guys lose.