Time to pay your federal taxes, so it's time for people to complain about how much we're taxed, or, alternatively, how little some people are taxed relative to their income, etc. Now comes Gregg Easterbrook, whose work I do not know (and now I know why, if this is a measure of his intellect). It is well known now that Barack Obama is for reductions in revenue expenditures–i.e., he's for increasing taxes (a phrase for which he was justly lampooned by Jon Stewart). But, Easterbrook spies a problem:
President Barack Obama wants to increase taxes on the wealthy, and surely is correct that this must be part of any serious plan to control the national debt. Consider the case of a wealthy couple who made $1.7 million in 2010, yet paid only 26.2 percent in federal income taxes — though the top rate supposedly is 35 percent, and the president says that figure should rise to 39.6 percent. The well-off couple in question is Barack and Michelle Obama, whose tax returns, just released, show they paid substantially less than the president says others should pay.
If Obama is in earnest about wanting increased taxes on the wealthy, then he should send the United States Treasury $182,998. That’s the difference between his Form 1040 Line 60 (“This is your total tax”) and what he would have owed at the higher rate (plus limits on itemized deductions) he himself advocates.
So why doesn’t he tax himself more? The Form 1040, after all, only stipulates the minimum tax an American must pay. More is always welcome. Obama should write a check to the United States Treasury for $182,998.
Wealthy people who say the rich should pay higher taxes — Bill Gates and Warren Buffett have joined Obama in declaring this — are free to tax themselves. If you believe the top rate should rise to 39.6 percent (Obama) or 50 percent (Buffett), then calculate the difference and send a check for that amount to the Treasury. Of course no one individual doing this, even a billionaire, would have much impact on the deficit. But if rich people who say they believe in higher taxes were willing to practice what they preach, this would prove their sincerity, making legislation on the point more likely.
This argument is so dumb that Megan McArdle made it (can't remember where I read the refutation). Normally, accusations of hypocrisy need to posit some actual or hypothetical (counterfactual) hypocrisy.
On Easterbrook's view, Obama is a hypocrite for not unilaterally taxing himself. He's rich, he advocates higher taxes for the rich, ergo, ipso fatso. But of course he's not a hypocrite, because he's advocating a tax policy he'll obey if given the chance.
As a practical matter, a bunch of rich people donating to the Treasury will likely delay tax increases on the wealthy–see, for instance, the free rider problem.
And, BTW, happy Charles Krauthammer Day!