With that in mind, President Obama is insistent that the "Bush tax cuts" be allowed to continue for one year for those families earning less than $250,000 per year. As such, several media outlets have reported that as being the President's entire proposal. But as has all too often been the case with the (alleged) most transparent administration ever, we're not getting the whole story.
Obama is not proposing that families making up to $250,000 a year keep their tax cuts while families making more than that don't. He's proposing that every family keep their tax cuts on their first $250,000 of taxable income (which is not the same as "income" or "earnings," by the way).As was pointed out to me by Kevin Watterson yesterday, such a "gimmick" was frowned upon sixteen months ago by perhaps one of Obama's most faithful Minnesota supporters, Governor Mark Dayton. Back then, MN GOP legislators looked to lower certain tax rates for all the state's taxpayers.
That includes families with taxable income of $260,000, $1 million, $5 billion, $3 trillion, or whatever Jay-Z and Beyonce make in a year. Everyone would continue to pay a lower tax rate on their first $250,000 of taxable income under Obama's plan. To report that Obama only wants to maintain tax cuts for families making less than $250,000 is simply false.
If you're wondering how literally the entire media could get this story wrong, look no further than Obama himself, who is framing his own tax proposal inaccurately. "I’m calling on Congress to extend the tax cuts for the 98 percent of Americans who make less than $250,000 for another year," he said in an East Room speech (Monday).
Normally, a president would want to publicize that he's trying to cut taxes for everyone in the country. But Obama actually has an incentive this time to downplay the number of Americans who would benefit from his tax plan. His proposal is, at its heart, a political maneuver meant to force Mitt Romney to defend tax cuts for the wealthy (Remember, there is a certain point where one's made "enough money" - ed.). It's more effective, then, for it to be seen as a cut solely for the middle class. The reality is that Obama's proposal would also keep Warren Buffett's taxes lower, if only a little bit.
“It bothers me the Republicans would present this as a tax cut targeted for lower and middle-income families when the facts are the opposite that the greatest benefit goes to upper-income Minnesota families,” Dayton said. “Once again they just have shown their values, their priorities are to benefit the richest Minnesotans at the expense of the rest of Minnesota.”One this is clear: Whether it's a Democrat chief executive of the whole country or one state, rarely can they be open or honest about taxes.