In a year where the 99 percent had the mic, many Americans wondered just how the country could start systematically addressing economic inequality. Well, Occupiers, the President wants you to know he was listening, and his first solution seems to be a cornerstone for his 2012 campaign-in-the-works. Obama is championing the Buffett Rule -- not to be confused with the buffet rule, the unspoken requirement to go overboard in the all-you-can-eat line at Denny's. But first...
tax bracket: a category of tax payer based off of a range of taxable income
In the US, not everyone pays Uncle Sam the same percentage of their annual earnings come tax season. Instead, people calculate what they owe based on what they made. Someone well below the poverty line will pay a much smaller percentage of his or her earnings than some Wall Street big shot, who may end up giving a huge chunk of change back to the government. The calculation gets trickier for the rich, too, since multiple tax brackets cumulatively apply. Theoretically, millionaires will end up paying over 30 percent of their incomes, while someone making, say, $10,000 a year may end up paying around 10 percent.
The problem, in some peoples' eyes, is that rich folks can afford clever accountants who can help find loopholes and rules that trim that 30 percent down quite low. When Daddy Warbucks and Orphan Annie are in the same tax bracket, something is fishy indeed.
Enter #BuffettRule. A few years ago, bazillionaire Warren Buffett famously remarked that he shouldn't be paying less in taxes than his own secretary. Obama agreed, and using some of Warren B's sentiments, some of the Occupy Wall Streeters' catch-phrases and some of his own je ne sais quoi, the Prez recently proposed a federal law called the Buffett Rule, requiring anyone who makes over $1 million in a taxable year to pay the 30 percent in income tax, minimum, guaranteed. No loopholing around.
Would the change effectively stimulate the economy? Critics have their doubts. Would it fire up his 99 percenter voting base? Quite possible. Would it point a not-so-subtle finger at his megarich likely GOP opponent Mitt Romney? You bet.
Ahhh, politics. The math-heavy saga continues ...