Obama has defined "rich" as anyone making over $250,000/year. Last night he vowed that nobody earning less than that would pay a dime in extra taxes as a result of all the things he has proposed. If we take that to include the $800 billion stimulus bill, it's tough to see how the numbers add up.
Based on data complied by the Tax Foundation for 2006, here is what we know: The top 1% of income earners (1.4 million taxpayers) had $1.8 trillion of adjusted gross income and paid $400 billion in federal income taxes. It took an income of at least $389,000 to qualify for that distinguished group. The top 2-5% of income earners (5.4 million taxpayers) had $1.2 trillion of AGI and paid $200 billion in federal income taxes. It took an income of at least $154,000 to qualify.
I'm going to assume that incomes aren't significantly higher today than they were a few years ago, and I'm going to interpolate and guess that the top 2% earn at least $250,000 per year, make about $2 trillion in income, and pay about $450 billion in income taxes.
A senior administration official announced today that "Obama will propose $634 billion in tax increases on upper-income taxpayers and cuts to government health spending to fund health reform over 10 years," and that "The proposed tax change would limit the deductions available to people in the highest income tax brackets."
Over the next three years, if he gets his way, I figure he is going to be spending an extra $600 billion or more on a the combination of "stimulus" and universal healthcare. That's probably a conservative estimate, since the Wall Street Journal's Op-Ed today guessed that universal healthcare alone would cost at least $220 billion a year. I don't think he can make significant cuts to health spending, and I figure he is lowballing his cost estimates. If he wants to bring the deficit down and not raise taxes on 98% of taxpayers, that means that the IRS is going to need to take at least an additional $200 billion a year out of the pockets of the "rich," if not much more. That means that the "rich" are going to need to cough up about 50% more in taxes per year, and that money will supposedly come as a result of the expiration of the Bush tax cuts and the elimination of most if not all their deductions. I just don't see how anyone can (or should, for that matter) try to pick the pockets of the rich for that much money. Even Robin Hood would never have been so brazen.
The magnitude of Obama's attempt to expand government at the expense of a tiny minority is just simply mind-boggling; so outrageous, in fact, that it is highly unlikely to work. If he succeeds in getting universal healthcare, the middle class will find themselves eventually saddled with huge new tax burdens and medical care that will be rationed by a group of "enlightened" bureaucrats.
The thing people need to remember about universal healthcare is that it cannot possibly be cost-effective. If you offer healthcare to everyone for "free," the laws of economics and human behavior dictate that the demand for healthcare will exceed the supply of it. Sooner or later it will have to be rationed, just as it is in places like Canada and the U.K.
And to think that we could probably solve 80-90% of the healthcare problem by simply changing the tax code so that anyone, not just employers, could deduct the cost of healthcare insurance. This would reintroduce basic market dynamics to the healthcare market, and that is the only thing that can make healthcare cost-effective and widely available.