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DEFINING "RICH" UP. How predictable is this?The Hill reports:
Leading Democrats in Congress and on the presidential campaign trail are having a difficult time agreeing on what it means to be wealthy.House Speaker Nancy Pelosi (D-Calif.) has said it means earning $500,000 or more annually. Sen. Charles Schumer (D-N.Y.) contends that raising the tax rate on families making more than $400,000 could offset legislation to slash taxes on the middle class.Sens. Barack Obama (D-Ill.) and Hillary Rodham Clinton (D-N.Y.) support scrapping tax cuts on those earning $250,000 or more, while former Sen. John Edwards (D-N.C.) has advocated raising taxes on families making more than $200,000.This is the inevitable result of a politics that recognizes, at last, that the tax cuts must be reversed but wants to pretend that the only people affected are some other guy -- "the rich." A few years ago, "rich" generally meant $200,000+ (less than three percent of U.S. households), now that's the opening bid, from the "populist" Edwards, and they go up from there.There are two ways out. One is to say, we all have to share in the sacrifice, in order to (save the planet, enact health care, keep the country safe, avoid fiscal crisis -- pick your favorite), and that means some people who consider themselves middle-class, too. Another is to avoid the whole issue of who's rich. Just say, "people with the same income should pay the same tax, whether they get their income from work or investments." Restore equitable tax treatment of dividends and capital gains, and you achieve the same goal, or much more, without entering that debate about who's rich.What makes that simple thing so hard to say?--Mark Schmitt
