Malarkey from Millionaires

Can you spare a few bucks to help disadvantaged millionaires pay higher taxes?

Recently, in coordination with President Obama’s renewed calls for a tax hike, the political-media establishment revived one it’s more absurd scams, “millionaires” complaining that the tax system doesn’t take enough of their income.  It’s absurd because a millionaire, indeed any taxpayer, is perfectly free to pay more than the law requires.  Nobody will stop them!

But millionaires of the “progressive” persuasion aren’t satisfied with voluntary payments.  Progressive doctrine is always to use force applied by government to impose their “good ideas” on everyone.

Millionaire Leo Hindery is Managing Partner of Intermedia Partners, a private equity firm.  He’s also a long-time political operative and Democratic party insider. He appeared on Fox News representing something called Patriotic Millionaires, a group that is seeking maximum media attention for their mission, to promote higher tax rates on incomes over $1 million per year.

We’ll comment on Mr. Hindery’s remarks but first, some observations on the website of Patriotic Millionaires.

It lists the names of 138 individuals who “now or in the past earned an income of $1,000,000 per year or more” and who have “signed the letter” to Congress asking for tax hikes.  There is no way to tell how many are “in-the-past” and thus would not have to pay the increased tax.  There is a form allowing anyone to join up and “sign the letter” without income verification.

A surprising feature of this website that purports to represent millionaires who are asking permission to hurl more millions at Obama’s government, is a request for donations!

They don’t disclose how donated money would be used, but if you click on the donate button you are transported to another website called “The Agenda Project” where a page that’s set up look like part of Patriotic Millionaires will accept your credit card number.

The Agenda Project appears to belong to author and political activist Erica Payne.  In her list of accomplishments under “about the founder” Ms. Payne boasts of having produced “a major conference” that included George Soros and Obama Czar Elizabeth Warren.

Now, Some excerpts from the Fox News interview of Mr. Hindery:

Question: Why would you want to give the government more of your hard earned money?

Mr. Hindery:

It goes back to the Premise of tax system.  We built it on the premise of progressive taxation that  those who earn more pay more…Beginning in 1986 we specifically took action to enrich the wealthy on the false premise that a wealthy person would pass that extra money down into the system.  But now am one of those people. I have everything that I need.  I don’t spend for anything.  I have no appliances I need to buy, no automobiles, no housing.  But all the women and men behind us [employees in the Fox newsroom] have things that they need to do in this very stressed economy.  So how is it that 50% of the nation’s income is earned by 3% of the taxpayers.”

According to IRS statistics for 2009. the latest year available, about 13% of taxpayers earn 50% of the income.  But more importantly, Mr. Hindery is arguing against a straw man.  The argument against tax hikes isn’t that every year high income people spend all their millions on appliances and cars.  Half of high income taxpayers are small business owners and virtually all are investors of some sort.  Their money goes “into the system” not as consumer goods purchases, but as the investment capital that starts and expands businesses, creating jobs.

Mr. Hindery doesn’t explain how a tax increase on investors and small business owners will help middle class employees who “have things they need to do.”

Question: 80% of the people disapprove of the job Congress is doing. So why would give more of your money to folks that most Americans think are mishandling it?

Mr. Hindery’s answer:

That’s the same excuse we use for offshoring of jobs, that the American population isn’t sufficiently educated, that the government isn’t sufficiently well run.  The reality is we have 29.2 million men and women who in real terms are unemployed…we have a moral as well as an economic obligation to ressusicate  this economy.

This of course is nonsense and does not answer the question.  Overseas labor is cheaper, not better educated.  Yes unemployment is tragically high.  But Mr. Hindery didn’t explain how extracting more taxes from business owners and investors would cause those business owners and investors to create more jobs.

Question: Why not start another business and create jobs that way instead of giving it to the government?

Mr. Hindery’s answer:

There are 5 million out-of-school unemployed…who can’t find their first job.  So we have a moral and economic obligation to resuscitate this economy…the only thing that works in this economy is a vibrant middle class, which we don’t have today.

Again yes, everyone agrees there are way too many unemployed people.  So again, how will higher taxes cause them to become employed?  Still no answer.

Queston: So you think higher taxes on millionaires supports that?

Mr. Hindery’s answer:

Absolutely.  What we did in Congress is we decided we would cut…But we raised no revenues.  So, let’s say we have the perfect job creation initiative in mind.  We have no money. So you can’t foreclose revenues and cut only.

So what is this “perfect job creation initiative?”  Didn’t the President and the Democrats already spend Trillions to, in Obama’s own words, “jumpstart job creation”?   Apparently, Mr. Hindery has nothing specific in mind but trusts that by taxing away more of their resources Congress could cause high income business owners and investors to create 29 million jobs.

He should have been but wasn’t asked why, if he believes he’s under-taxed, he doesn’t just shut up and write the IRS a check.

2 Comments so far

  1. atlanta chiropractors on August 19th, 2011

    Well, all things considered…

  2. Drew on August 20th, 2011

    Buffet is just a blowhard looking for good press. Look at this:

    http://www.cnsnews.com/news/article/warren-buffett-s-tax-solution-won-t-solv

    for a more sober look at the raw math. There is just no two ways about it, we have a runaway spending problem, not a taxing problem. And to try to tax our way to solvenct will cause higher taxes all the way down to $50K a year, and destroy the economy.

    Its a shame Buffet is so media hungry, and the media so star struck, that we have to put up with this nonsense.