This article is about an announcement that president Barack
Obama made. He said that he would work
on revising tax break that helps rich people pay lower tax rates than many wage
workers. President Obama calls it a
Buffet rule, which is interpreted from Warren Buffet’s comment; “I shouldn’t
pay taxes at a lower rate than my secretary.”
Revising the current tax break would help wageworkers and
Obama would win the popularity vote. It
is predicted that this would close the gap of inequality a little, but when we
think about the large amount of national debt of US, it is not so bright news
in my opinion. More tax break for many
wageworkers mean that it will be a tax break for majority. If top 1% income group’s revised tax break
(higher tax rate) can cover the loss tax from majority, it’s the best, however,
the fact isn’t like that.
Also, Democrat’s debate on extending debt limit and
extending payroll tax cut last year helped Democrats to gain more votes. Extending debt limit means more debt but
intension of more economic activities.
Extension of payroll tax cut will help workers to gain more income, but
current popular programs like Social Security and Medicare will suffer from
lower budget.
As we all know, Mr. Obama is trying to run a presidential
election in 2012. His announced policies
have positive and negative affects in the economy. The debates that democrats make seems to be
helpful in a short run, although, the policies were in demand by many people.
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2 comments:
Good post! When economics and politics align, politicians enforce effective policies that help generate economic growth. Democrats already know that increasing taxes on the rich will get votes, especially since our country has been reenforced to believe in progressive taxes. Furthermore, when Warren Buffet says "I should be taxed more", this will help independents believe that these policies are right. From my perspective, this is common sense and Republicans who drag their feet in passing this bill, are only hurting their reelection bids.
I agree with Anthony that increasing taxes on the rich will help get votes. Ever since I heard that Warren Buffett came out and said that he has a smaller tax rate than his secretary and that he believes that is not right, I have been wondering when a bill to change that would be passed. However, there seems to be much argument over it, which I do not understand. It only makes sense for those who have the most money to have a tax rate at least as high (if not higher) than those who earn less money than them. Why should those who make less have to pay a higher percentage of their income in taxes?
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