Taxes, the candidates, and the American rich
Warren Buffet, the world’s richest man according to this year’s Forbes Magazine list, has acquired a personal fortune worth $62 billion. Yes, that is “billion” with a “b.” Last October, the “Oracle from Omaha,” as Buffet is known in financial circles, stated in an interview with NBC’s Tom Brokow that the rich do not pay their fair share of taxes.
Buffet, after checking on his office workers’ tax rates, offered this challenge: “I'll bet a million dollars against any member of the Forbes 400 who challenges me that the average for the Forbes 400 will be less than the average of their receptionists.” How can this be? Why would an average middle-class receptionist pay a higher tax rate than the world’s richest man?
Buffet proved it by conducting a survey of 18 of his office workers (15 actually participated) to find their average tax rate, which was 32.9 percent. Buffet revealed to Brokow that he paid 17.7 percent on his last tax return. Buffet admitted to having no tax planning or tax shelters: “I just follow what the U.S. Congress tells me to do.” If the tax laws are written to benefit the wealthy, that select minority might be a little nervous depending who becomes the next president of the United States.
As reported by the Associated Press, John McCain told Rick Warren during the Compassion Forum at the Saddleback Church in Lake Forrest that, “I don’t want to take money away from the rich. I want ever everybody to get rich.” John McCain is not rich. According to Sam Youngman of The Hill, “McCain's Senate salary and book royalties amounted to $215,304 in 2006 and $258,800 in 2007. In 2006, the senator paid $72,771 in federal taxes and $84,460 in 2007.”
John McCain’s income is a pittance compared to his wife’s inherited wealth. No one knows for sure how much Cindy McCain is really worth although Kenneth P. Vogel of Politico says that she and the “McCain children are the beneficiaries of a beer distributing fortune amassed by her parents and estimated to be worth $100 million or more.” John and Cindy McCain have always kept separate finances and filed separate income tax returns. On NBC’s Today Show, Cindy McCain told Ann Curry in May that she will not release her tax returns because she is not the candidate.
Barack and Michelle Obama have done well financially over the last few years according to Jim Popkin, Senior Investigative for NBC News. They released their joint tax returns for 2000 through 2006 and it shows that in 2006 the “Obamas' combined income was $983,826.” As a U.S. Senator, Obama received a salary of about $165,000 a year, and Michelle’s “income from the University of Chicago Medical Center had sharply climbed to about $265,000 a year.” She also earned “an additional $51,200 that year, as working as the director of TreeHouse Foods” and he earned $551,240 from his writing.
Thanks to the success of Barack Obama’s writings, the family income jumped to $4,238,165 in 2007 with $3,943,378 of it coming from his book sales according to Lynn Sweet of the Chicago Sun-Times. The Obamas are millionaires, but they are not in the same league McCains, or make that Cindy McCain.
Both McCain and Obama have tax plans they plan to implement if they become president, but they differ greatly. The Tax Policy Center states that “Senator McCain's tax cuts would primarily benefit those with very high incomes, almost all of whom would receive large tax cuts that would, on average, raise their after-tax incomes by more than twice the average for all households.”
The opposite would be true under the Obama tax plan: “In marked contrast, Senator Obama offers much larger tax breaks to low- and middle-income taxpayers and would increase taxes on high-income taxpayers. The largest tax cuts, as a share of income, would go to those at the bottom of the income distribution, while taxpayers with the highest income would see their taxes rise.”
McCain has constantly stated that Obama will raise your taxes, which is not really accurate unless you make a quarter of a million dollars or more a year. According to the Chicago Sun Times, “Obama would raise income and capital gains taxes on earners over $250,000. McCain would cut the estate tax. Obama would raise it on estates over $3.5 million.”
Obama would require the rich to pay their fair share in taxes for a change—a plan that would make Warren Buffet a little happier. The Obamas themselves with their new-found wealth would pay more in taxes. McCain’s plan will have to continue to dupe the lower and middle classes in to believing that the wealthy truly deserve to keep their bigger piece of the American pie.
ABOUT THE WRITER
Carol Jensen is a long-time Barstow resident, graduating from Kennedy High School and Barstow College, where she was an English instructor for many years. Much of her time now is spent writing political and social commentary. She may be contacted at cajensen49@msn.com.
