The Obamas are rich. Not quite as rich as Richie Romney (book sales have leveled off) but pretty well-off. And he's not denying that--he's using it to prove that his effective tax rate was perhaps lower than the average secretary, er, sorry, executive assistant.
And how, how did he do it? Not by using the Buffet break, but another break that "benefits the wealthy" according to Huffpo:
According to their tax returns released Friday by the White House, the president and the first lady claimed a $47,564 home mortgage interest deduction on their house in Chicago, which they bought in 2005 for $1.65 million. That equates to $13,318 in savings on their federal tax bill, according to an analysis by Michael Gillen, director of the tax group at the Philadelphia law firm Duane Morris.They didn't have many capital gains to be taxed at the Buffet-friendly 15 percent rate so the spin is that he overly benefited from a perk of the rich--the mortgage deduction taken on his Hyde Park mansion. If only that unfair perk could be eliminated for the richest richies we might get back to fiscal health..
"Lots of middle-class people take the deduction and realize some savings on their tax bill, but they don't understand that it is badly skewed," said Seth Hanlon, director of fiscal reform at the liberal-leaning Center for American Progress. "A lot of people don't realize that the benefit can be taken on vacation homes or even a boat."Then again, some might consider it the epitome of 'fair' insofar as the current code has no penalties for being successful. Buying that second home or boat can surely be called a stimulus, no? Why discourage it? After all, boatbuilders and carpenters need the work we're told. It's what God would do!
By the way, Huffpo's use of experts from the Center for American Progress should be a tell-tale; they probably coordinated the attack with the ultimate goal of redistributing wealth. Just don't call them socialists.
But such a strategy is both clueless and unnecessary. The last great liberal-Democrat president, William Jefferson Bubba Clinton III, somehow managed to balance the federal budget in the late 90s without resorting to any class warfare whatsoever. How, how did he do it? Well, he raised taxes to unprecedented levels in 1993 with a Democratic Congress, then Gingrich came to power in a tantrum in 1995 and made sure the extra revenue didn't get spent on frivolity. 'Presto', balanced budget. Shouldn't that be a template for the current crop of political leaders?
No, of course not. The GOP can't possibly call for a return to Clinton tax increases due to the Tea Party; Obama is a rigid ideologue who would lose most of the arrows in his class warfare quiver if he had to admit the Bush tax cuts actually helped middle class people and not exclusively Ann and Mitt. So the solution is out there but neither side is capable of engaging it, which is why we see these silly distractions.
It's too bad some in the GOP can't call Obama's bluff and demand we go back to the Clinton-Gingrich model of the 90s to return to fiscal balance again. That would force Obama to acknowledge that his real goal is not fiscal sanity, rather a strange desire to punish success, which in turn may cause some to reconsider all those stories about the kind of people he used to pal around with. Of course Gingrich could recommend it since he was there--but then again he can't, can he? So here we are.