Recently, Warren Buffett joined with the president to say the "rich" should pay their "fair share" of tax. President Barack Obama mentioned Buffett specifically, pointing out that he pays a lower rate than his secretary (never mind that he pays a factor much higher).
Ignorance helps their argument carry the day, but if we open our minds, we can see the totality of taxes paid by the rich. Also, we might better understand the total economic impact of those so frequently demonized in the media.
The IRS has amassed a trove of information concerning taxes paid and who pays them. The "rich" — or as I like to refer to them, the "producers" — carry the overall tax burden by far. In contrast, the lower 50 percent of wage earners pay little to no income tax whatsoever. The figures readily available have something to say about how much the producers pay, in terms of income tax. As a CPA, I see it every year.
But have you ever stopped to think about the other taxes paid by these folks? For instance, most rich people love to play when they are not working. They buy Ferraris, Louis Vuitton, Gucci, Mooney airplanes, Rolex watches and so on. The amount of sales tax paid for these items is staggering. In comparison, the average person buys items that sell for a fraction of the price of these luxury brands, paying little tax as a result.
And what property tax? The income, sales and property taxes collected from the producers dwarf what is paid in by the so-called working class. And what about the poor? Forget about it; they have very little to no property tax liability. And in the end, it is the poorest of us who use up much of what is collected by the government. In most cases, it is they who have failed to position themselves for success.
So the hard work, perseverance, toil and innovative spirit of a driven person, all of which may culminate in exorbitant wealth accumulating to him or her, is taken by force of law under the guise of fairness and allocated to pay for the misdeeds, mistakes or simply the lack of resources of so many others.
In America, the failure to carefully plan for one's future is met with the omnipresent hand of the government, who reassures those who lack wisdom that the fruits of the wise will be redistributed for their benefit. Does that sound fair?
Finally, the producers (the "rich") make things happen every day by their habits. They innovate, change processes, rethink old patterns and create jobs as a consequence. It appears the desire of wise people to become rich is the driving force behind whatever success is generated, and this is what makes jobs after all, not government.
The hard work can pay off in millions of dollars, but your results may vary. I think that's fair.