'Buffett Rule' are fighting words

There are certainly fighting phrases today.

One of them is the Buffett Rule. I learned quickly that mentioning the two words can elicit a flurry of comments -- many of them hostile and angry -- about the proposal to raise taxes on the wealthiest Americans.

But I have to admit I purposely walked into the lion's den when I made a few calls to local millionaires to ask what they thought of the proposal.

They don't like it, to say the least.

On one hand, they believe the tax code definitely needs some work. "It's broken," one Sarasota entrepreneur said. This from a man who is in the 35 percent tax bracket and estimates he's paid $20 million in his lifetime in income taxes.

As a member of the media, I've been bombarded with press releases recently from a variety of sources, most in favor of the Buffett Rule. Among them nine business organizations who are disputing claims that a Buffett Rule would negatively affect small businesses owners. An overwhelming majority of small business owners fall below the million-dollar tax point, they say.

"When politicians who stand against a Buffett Rule for millionaires wring their hands about how it will impact small businesses, let's be clear: That's small business identity theft," said Benjamin Markeson, owner of Three Star Flea Market in Apopka.

Yet the millionaires I talked to brought up some legitimate reasons for their opposition to the proposal.

One started out his career at the bottom salary rung but worked his way up the ladder of success. He thinks the change is tantamount to changing the rules in the middle of the game.

He saved his money, worked hard, didn't overextend or depend on credit and took advantage of investments to guarantee a secure financial future. Instead of attacking one segment of taxpayers, he believes the entire tax code needs to be adjusted, including laws impacting the estimated 48 percent to 50 percent who pay no taxes at all.

"It is not quite so easy

as picking a certain part of the populace and saying they have to pay more without looking at the situation as a whole," the Sarasota businessman said.

Another called it "class warfare at its finest."

Creating a policy that punishes success and rewards irresponsible behavior is not the answer, the Lakewood Ranch man said.

"Policy has to be aligned with the desired outcome," he said, stressing that taxing millionaires won't mean a better financial situation for the country.

"You don't make poor people rich by making rich people poor," he said.

Currently, the top 1 percent of taxpayers earn about 17 percent of all "adjusted gross income" calculated by the Internal Revenue Service, and they pay about 37 percent of all income taxes, according to the Tax Foundation, a Washington research group.

Yet there are plenty of wealthy and upper-income taxpayers, including successful entrepreneurs, executives and inheritors, who are coming forward to argue that people like themselves should pay higher taxes.

United for a Fair Economy and Responsible Wealth members are supporting tax policies including ending the preferential treatment of investment income by taxing wealth like work, restoring a strong federal estate tax, and ending the Bush-era tax cuts.

David A. Levine, former chief economist at Sanford C. Bernstein & Co., a millionaire and a member of the Responsible Wealth project from New York City, said, "There's no question that we should raise the top marginal rates on people like me with high incomes. Several higher brackets at, say, $1 million, $5 million and $25 million make sense. We also need to restore the status of dividends as ordinary income. There's no reason to give that form of income an advantage."

The Senate is scheduled to vote on the Paying a Fair Share Act today. Most people agree it probably won't pass a final vote.

It's an emotional issue and it's an election year -- a volatile combination that doesn't usually bode well for clear heads and thoughtful debate.

But as a nation that continues to move closer to a "have and have not society" with a dwindling middle class, we need to keep talking.

Jennifer Rich, Herald business editor, can be reached at 941-745-7087.