We have never seen a US president take "class warfare" to such a perverse level. We've seen this in Latin America, from Juan Peron to Evo Morales, but not here.
First, Pres BO completely misrepresented the case or story of Mr Buffet and his faithful secretary. (By the way, what is Mr Buffet getting from this administration to go through all of this?)
Second, Pres BO presents it as some great injustice in the tax code, i.e. "the rich are not paying their fair share".
Third, Pres BO confuses "investment income" with "salary & wages".
John Wesley Gordon explained it today:
"Since Buffett’s income comes overwhelmingly from investment income and he is one of the richest people in the world, of course the people working for him in his office pay a higher percentage of their incomes in FICA taxes.
And, as I have discussed earlier, he ignores the fact that his investment income, from dividends and capital gains, has already been taxed–at 35 percent–at the corporate level.
So the personal taxes he pays on it are double taxation.
His actual effective tax rate is closer to 44 percent than 15 percent.
He’s paying far more in taxes, as a percentage of income, than his secretary."
This is very important. Mr Buffett has already paid income taxes. He is now paying taxes on the investment. This is why he is currently paying a "lower rate".
All of this is a bit too technical for many people. In other words, Pres BO's demagoguery is ideally suited to exploit the situation.
Mr Buffett and his secretary were on TV today and the ABC correspondent did not ask them any questions or explain to the audience that this is all a big "scam".
The WSJ has a great editorial today and I hope that most people read it: The Buffett Ruse
Yes, this is a "ruse" and one giant distraction from Pres BO's record.
My fear is that many people will believe it.
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