The Millionaire roadshow

If you have followed the news recently, you have heard about the group that calls itself "Patriotic Millionaires for Fiscal Strength" testifying before Congress recently. They claim to be bona fide millionaires, and we have to take their word for that. They are asking, they say, for abolition of the Bush tax cuts, and for higher marginal rates on high-income earners. Certainly sounds patriotic, doesn't it? Obviously, these "patriotic millionaires" want to see the national deficit reduced, they care about their country with all their heart, and they have come to ask Congress to come together to do the right thing, the "real" thing. That is, make sure everyone pays their fair share as defined by the Democrats, because Democrats care (unlike those nasty, cold-hearted Republicans.) That's what these "patriotic millionaires" want.

Or do they?

Perhaps they really have pure hearts and compassionate souls, as they are portrayed. Maybe - maybe not.  A reporter from the Daily Caller met with some of them and gave them the opportunity to voluntarily donate their own actual cash money to pay down the debt.  Not one of them donated even so much as One Dollar, although one must be fair and assume perhaps they already donate on their tax returns and they're just too modest to say so.  Several of them complained that such donations would have no real effect on the deficit, and perhaps that also is true - a Thousand Dollars, or even a Million Dollars doesn't do much to reduce a now $15 Trillion Dollar debt.   It's also laughably irrelevant, as any middle-income earner knows, since the IRS will be knocking on your door to collect what you owe, however little it may be, if at tax time you choose not to "donate."

It is much more likely that the answer is found elsewhere. In a PBS interview, one member of the group, Garrett Greuner, explained that, "I have built up a number of companies myself, and I have been a venture capitalist now for almost 20 years.... And I can say, for myself, that not a single one of those investments, not one was ever impacted by marginal tax rates."

The interviewer asked Greuner about the small business owners, "Then why do we hear that so often from small -- the millionaire class, which includes many small businesses, we hear, why do we hear that tax rates do have an impact on whether they start their business, whether they hire that one extra person?

GARRETT GRUENER: I think it's -- frankly, I think it's a myth."

Ask your tax preparer about this, because it is important.  Investment income, Gruener's income, is likely to be taxed at lower capital gains rates of 15%. Generally, the higher marginal tax rates of 35% apply to earned income, which is what small business owners have. 

In other words, Gruener is delighted to have marginal tax rates raised, because it appears he doesn't pay them. Investment income is taxed only at 15%, untouched by marginal tax rates, he's happy to have Congress raise those. He is telling Congress to raise taxes - on his competitors, the small business owners who DO pay them. It seems to be sheer self-interest motivating this Millionaire roadshow. Do you suppose Mr. Gruener and his merry band of Patriots would feel as patriotically motivated to have investment income taxed at earned income rates?

This movement seems to follow the lead of Warren Buffett.   Mr. Buffett, it appears, helped design the TARP program for Mr. Obama. Under the rules shaped by Buffet, and adopted by Geithner, Mr. Buffett appears to have made huge profits. You can read about it in Peter Schweitzer's book, Throw Them All Out.

It appears these millionaires may merely be doing what liberals do best: compassionately taxing and spending other people's money.