September 20, 2012

What Precisely is Wrong with Obama’s “Redistribution” Statement?

With increasing desperation, Mitt Romney, his campaign and his conservative supporters are trying to find a way to deal with all the political carnage. The past few weeks have not been kind to Mittens.

First you have the terrible Republican convention highlighted by an old white guy talking to an empty chair in an arena full of old white people. Next you have the successful Democratic convention which included well-received speeches by Bill Clinton and Michelle Obama, and the resulting bounce in the polls for President Obama. Then there was Romney’s awful handling of the Libyan consulate deaths, and now this week it’s been 24×7 coverage of the secret video at a $50,000 a plate Romney fundraiser where Romney threw half the country under the bus.

So what’s the response? Well, Romney doubled down during a brief press conference Monday night where he really had nothing to say in response. He didn’t apologize. He didn’t walk back his comments. Nothing. He simply said it was “not eloquently stated.” As for his conservative supporters, many of them are saying Romney should not only own his 47% comment, he should campaign on this message of division. These conservative supporters say he spoke the truth.

But since contempt for half the country is probably a bad political strategy, they are attempting to combat the damning Romney video with a “secret” video of their own. Well, except it’s not so secret, and it’s also pretty old. The video is from 1998 and in it, Obama says the following:

I think the trick is figuring out how do we structure government systems that pool resources and hence facilitate some redistribution because I actually believe in redistribution, at least at a certain level to make sure that everybody’s got a shot. How do we pool resources at the same time as we decentralize delivery systems in ways that both foster competition, can work in the marketplace, and can foster innovation at the local level and can be tailored to particular communities. – Barack Obama (1998)

Is there supposed to be something wrong with this statement? I’d like for somebody to point out the flaw in Obama’s logic. This is exactly what government is for. Not everybody is born with a silver spoon in his mouth. Not everyone is born with the same opportunity. Money is what rules our society. If you have it, doors are wide open. If you don’t, not only are most doors closed, they are welded shut.

This is exactly why we have a progressive income tax system. Unfortunately our tax system is not nearly as progressive as it needs to be. It used to be much more progressive, but so-called “fiscal conservatives” have tinkered with the tax code for decades, bringing the top tax bracket down from over 90% to 35%. At the same time, they have constructed so many loopholes and deductions that nobody actually pays that 35%. Sure, this is true for the lower tax brackets as well, but the point is that many millionaires and billionaires have effective tax rates that are at or below people struggling to get by. Just ask Mitt Romney and his 13% effective tax rate.

So there is nothing wrong with Obama’s statement from 1998. Government should tax based on ability to pay, and this results in a redistribution. The only problem we have is that this redistribution is not currently large enough. We have a huge income and wealth divide in this country. It’s not about makers and takers, it’s about monetary means. It’s about ability to pay. Those who have benefited the most from society owe the most to society.

If you are rich and you have contempt for everyone you think is beneath you, so be it. All you have to do is pay a little more in tax. You will never miss it, and you will never be required to personally associate with those you belittle. That is all that is asked of you. And if you think this is awful and socialist, well, that’s too bad. If you think what I’ve just explained is wrong, you are simply selfish.

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