About a month ago, Warren Buffett, the chairman and chief executive of Berkshire Hathaway, made a strong case in support of raising taxes on those who enjoy enormous wealth. He noted, among other things, that he has a lower tax burden, as a percentage of his income, than anyone in his office. Millionaires and billionaires, Buffett said, “have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.”
It looks President Obama is inclined to agree.
President Obama on Monday will call for a new minimum tax rate for individuals making more than $1 million a year to ensure that they pay at least the same percentage of their earnings as middle-income taxpayers, according to administration officials.
With a special joint Congressional committee starting work to reach a bipartisan budget deal by late November, the proposal adds a new and populist feature to Mr. Obama’s effort to raise the political pressure on Republicans to agree to higher revenues from the wealthy in return for Democrats’ support of future cuts from Medicare and Medicaid.
Mr. Obama, in a bit of political salesmanship, will call his proposal the “Buffett Rule.”
For the record, the NYT article quotes “administration officials,” which might suggest it’s still in the realm of rumor and insider scuttlebutt, but given the fact that the president’s official Twitter feed is promoting the Times article, it’s a pretty safe bet the article accurately reflects the White House’s thinking.
We don’t yet know all of the relevant details — most notably, what the new millionaires’ minimum tax rate would be and how much it would be expected to raise — but the fact that Obama is going at all this route is extremely encouraging.
Indeed, I’d encourage folks to consider the larger context. When the president said in his joint session speech that he’d deliver “a more ambitious deficit plan,” many of his detractors on the left feared the worst. He might, critics warned, go after Social Security as part of an effort to strike a deal with Republicans.
Everything we’ve seen from Obama this month suggests this White House has chosen a new posture when dealing with the GOP. The introduction of the American Jobs Act was a pleasant, progressive surprise; the White House’s reluctance to start making concessions was clearly a step in the right direction; word that Social Security is off the table is just what the left wanted to hear; and support for the “Buffett Rule” suggests Obama and his team aren’t afraid to draw contrasts with unpopular, hard-right congressional Republicans.
It’s possible that for many of the president’s critics on the left, it’s too late. But for those who’ve been urging Obama to adopt progressive principles and show a willingness to fight, it’s worth appreciating the fact that the president is doing exactly as they recommended.
Based on nothing but speculation, I’d bet the debt-ceiling fiasco changed Obama’s entire approach rather dramatically. The president very likely assumed that if he worked in good faith, offered reasonable concessions, and demonstrated a commitment to compromise and common ground, Republicans would respond in kind. The summer offered a painful lesson — those assumptions were wrong. GOP officials have rewritten the rules.
With those lessons in mind, the president is now taking a tougher line. Good for him — and for us.