Sometimes, it's all just too much to take.
The president himself has admitted, if not in so many words, that the so-called Buffett Rule is little more than a gimmick. Bringing in $4.7 billion per year won't do much to solve $1.4 trillion dollar deficits. And, the administration concedes, this latest attempt at soaking the rich does little to spur growth.
But what's especially galling for those with a bull's-eye on their back is the pious specter of Messrs. Obama and Buffett demanding higher taxes while deliberately ducking -- albeit legally -- the tax man themselves. Just how is it you make a moral argument about "fairness," all the while eschewing your self-described moral obligation?
In the last couple of years, it appears that Mitt Romney, Warren Buffett and President Obama have had effective income tax rates of 15.4 percent, 17.4 percent and 20.5 percent, respectively. All took sizable advantage of charitable deductions, which taken together with other taxpayers costs the Treasury $52 billion annually.
This pales in comparison, however, with the tax code's biggest loophole, the exclusion of employer-provided health insurance from taxable income. According to the Congressional Research Service, that amounts to more than $164 billion per year in foregone federal revenue, barely surpassing another middle-class tax break, tax-deferred pension contributions.
So why then is the president so obsessed with the Buffett dodge? True, when not preaching to the rest of us, the Oracle of Omaha has studiously kept his corporate salary at a minimum (i.e., less than his secretary's), thus avoiding a 35 percent top rate on ordinary income.
By deriving the bulk of his annual wealth from his investments, Buffett enjoys the lower 15 percent rate for capital gains and dividends. But the "rule," levying a 30 percent rate on any income for folks like Romney, Buffett and Obama, represents a massive new tax on investment and ignores the fact that corporate profits are already taxed at 35 percent before any gain is realized and even after any dividend is distributed.
Moreover, history shows that the "demand" for capital gains is, in economic terms, the most of elastic of all. If rates go up, gains simply aren't realized, depriving the government of revenue. If rates decline, then revenue tends to rise along with after tax earnings. This is exactly what has occurred every time the capital gains rate was adjusted over the last four decades.