President Obama is 'spreading the wealth,' that is, taxing the rich and redistributing the wealth. Good policy or heavy-handed intrusion?
With passage by Congress of healthcare reform, Joe should pay attention. The redistribution of income favored by President Obama will soon begin in earnest.
The new healthcare law will cost the richest 1 percent of families an average $52,000 apiece, or $61.2 billion as a group, in fiscal 2016, according to estimates by the conservative Tax Foundation. That's largely due to a Medicare tax hike on those earning more than $200,000 (singles) and $250,000 (couples). That tax will apply for the first time to investment income, which includes capital gains, dividends, and interest, which generally make up a larger portion of the income of wealthier people.
There is more redistribution to come:
•The Internal Revenue Service has stepped up audits of those making $1 million to $5 million by 33 percent in 2009, compared with 2008; and up 8.5 percent for those earning $10 million or more.
•Uncle Sam has been boosting revenues by an unspecified number of billions by cracking down on overseas tax shelters, including those in Switzerland, used mostly by the affluent.
•Congress must decide what to do with Bush tax cuts that favor the rich but expire at the end of 2010. The Senate Finance Committee, under chairman Max Baucus (D) of Montana, had not at this writing set a date to consider what to do with the cuts or whether to revive the estate tax, which expired this year.