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theodore M I R A L D I mpa ... editor, publisher, writer. katherine molé mfa ... art director
Thursday, February 6, 2020
Bloomberg BULLIED POOR with Taxes; New Plan Would KILL Jobs and Values of 401Ks and IRAs
The former New York City Mayor wants to Raise Taxes, again Democratic presidential candidate and former New York City Mayor Michael Bloomberg talks to supporters Tuesday, Feb. 4, 2020 in Detroit. (AP Photo/Carlos Osorio) Grover Norquist
Michael Bloomberg wants to raise taxes. Again.
Before former New York Mayor Michael Bloomberg announced he was running for president, he was most famous for bragging about the wonders of taxing low-income Americans.
Taxes could be used as a cattle prod to make “them” (as he so kindly referred to the less well off) behave as he wishes.
On April 19, 2018, at an International Monetary Fund meeting Mr. Bloomberg reveled with the IMF’s Christine Lagarde about the power of taxes to control the poor.
Mr. Bloomberg gleefully told Ms. Lagarde and the audience, “Some people say, well, taxes are regressive. But, in this case, yes they are. That’s the good thing about them because the problem is in people that don’t have a lot of money and so, higher taxes should have a bigger impact on how THEY deal with themselves.”
If Mr. Bloomberg doesn’t think the peasants should be allowed to do certain things, he’ll tax them ‘til they cannot afford it anymore.
Mr. Bloomberg has pushed taxes and even bans on soft drinks, popcorn, salty food, cigarettes, vaping and energy use. Al Gore keeps flying on corporate jets, but taxes on “carbon” (energy) will keep the less well-heeled back in the busses.
But now Mr. Bloomberg is no longer just a busybody billionaire, but a candidate for the nomination of the Democratic Party. Yes, bullying the poor to learn to live with more expensive (and less) air conditioning in the summer and costly heat in the winter and higher gas prices year round is still on the agenda. But now Mr. Bloomberg must also compete in the envy and covetousness part of the primary contest.
Here Mr. Bloomberg is an awkward amateur compared to the professionals led by Bernie Sanders and Elizabeth Warren. He knows the words if not the melody.
Mr. Bloomberg’s opening bid in the envy race to the bottom is to restore the top personal income imposed by Barack Obama: 39.6 percent. When Ronald Reagan left office, the top rate was 28 percent. The economy grew 4.2 percent after Reagan’s tax cuts. It grew 1.8 percent in the years after President Obama took the top rate to 39.6 percent.
But that is just the start. Mr. Bloomberg adds to the 39.6 percent another 5 percent, so a total of 44.5 percent to those earning $5 million a year — Jimmy Carter, 1980 territory. And like the 1969 AMT or Alternative Minimum Tax that was supposed to only hit 155 Americans and then grew to threaten tens of millions one can be certain this 5 percent will be coming to an income bracket near you — sooner rather than later.
Second, Mr. Bloomberg would raise the death tax. He wants to widen its net to hit more Americans, more family business and farms. The last time the Democrats were in charge the death tax hit anyone stupid enough to die with life savings of more than $650,000.
Third, Mr. Bloomberg targets 32 million self-employed, family businesses known as “pass throughs” as these generally smaller businesses pay the personal income tax rates rather than the corporate rate. Today, companies like Mr. Bloomberg’s pay 21 percent. He would raise the tax on such smaller businesses to as much as 39.6 percent. It was one of the great steps forward when the Trump Republican tax cut of 2017 brought relief to smaller firms. Now, small firms are taxed only a little bit more than big businesses like Mr. Bloomberg’s. That relief for smaller firms will be gone under Billionaire Bloomberg.
Fourth, to get the ax are growing companies that expand and upgrade their equipment. Mr. Bloomberg would end the “like-kind” provision that postpones the capital gains tax if you sell your smaller tractor and buy a new larger tractor as your farm expands. Ditto for smaller businesses expanding to larger buildings. Mr. Bloomberg would hit such growing business with body-blow taxes as they try to grow as he once did with his firm. (Sorry chumps you were born after I was.)
Fifth, your IRA or 401K, your life savings for retirement will get it in the neck. In the past three years, the 100 million 401Ks and 50 million IRAs and other saving programs have expanded in value protecting the retirement income of more than half the nation. The Dow Jones increased from 18,332 on the day Donald Trump was surprisingly elected to more than 29,000 today — increasing the value of your life savings by 60 percent.
Mr. Bloomberg threatens to increase the tax on those companies whose stocks are in your 401K by 33 percent — from 21 percent to 28 percent. And since every other Democrat running for president has demanded repealing the entire Trump tax cut — which would raise the tax on businesses to 35 percent, we would see a return to the smaller 401Ks and IRAs of the Obama years. Good luck retiring when Mr. Bloomberg is through with your life savings. He is fine, however, if you were concerned.
Every proposal put forward here by Mr. Bloomberg has in the past reduced employment and reduced the value of every 401K or IRA.
There is, however, one last idea Mr. Bloomberg presents that would increase employment: He promises to increase the number of IRS agents.
No kidding. He does have a sense of humor. Gallows humor, perhaps.
• Grover Norquist is president of Americans for Tax Reform.