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VIDEO

Reagan Made the Same Tax Argument as Obama

Said in 1985 speech that secretaries shouldn't pay higher tax rates than their corporate bosses

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by David Mark

Editor-in-Chief t

Image: AP

The hairstyles are frizzier but the arguments on taxes are the same. In 1985 President Ronald Reagan said business executives shouldn't pay lower tax rates than their secretaries. That's just the pitch President Barack Obama is making a generation later, according to a video going viral on Reddit and elsewhere.

An urban-sounding narrator quotes Reagan saying a man who made a six-figure income wanted to testify before Congress to explain why he thought "paying a smaller tax" than his secretary was wrong. Obama now says much the same thing about Warren Buffett's secretary.

In 1985, Reagan delivered another speech further expounding on the effects of loopholes that allowed the wealthy to pay little to no taxes, says the unnamed video narrator.

"We're going to close the unproductive tax loopholes that have allowed some of the truly wealthy to avoid paying their fair share," Reagan told the crowd. "In theory, some of those loopholes were understandable, but in practice they sometimes made it possible for millionaires to pay nothing, while a bus driver was paying 10 percent of his salary, and that's crazy. It's time we stopped it."

Via Reddit and YouTube.

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Comments (view in Forum)

  • PNWest
    !
    This just goes to show you how far to the right that republicans have gone. When a party calls positions taken by guys like Ronald Reagan and Barry Goldwater too liberal that party has fallen off the deep end.
  • drpeeper
    !
    Who would have thought. This is what Romney campaigned on (closing loopholes)- and Obama just rejected.. But, Obamabots were too deaf to listen.
  • PNWest
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    @drpeeper The people didn't believe Romney. He refused (as do the GOP leaders now) to specify what 'loopholes' he wanted closed. It was and is all smoke and mirrors. The people elected Obama and support him in raising taxes on the rich. End of story.
  • drpeeper
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    @PNWest Correct- the have nots want the haves to pay. Even though they already pay the majority of all taxes. So how specific is "the rich"? To Obama that's anyone making over 60K.
  • PNWest
    !
    @drpeeper Keep campaigning on the argument that "the have nots want the haves to pay". It worked really well for you last month. HAHAHAHAHA
  • View all 31 replies >
  • u
    Nemesis3X
    !
    How do you get socialism. He's talking about real fairness and I agree. If the secretary is paying 10% so should her boss and so should the janitor!!!!! That's the problem too many of you Dems want the rich to pay and the "poor" to contribute nothing! That's not fair. Hell, I wish I was only paying 10%!
    We need real tax reform, not feel-good reform we get from politicians!
  • u
    AceLuby
    !
    @Nemesis3X It shouldn't ever be about 'fair', but about what makes the most sense economically at the national level. Higher taxes on people who spend their entire paychecks means money is being taken out of the private sector and lowers aggregate demand. Higher taxes on people who don't spend their entire paychecks means the taxes will have less of an effect, if at all, on overall aggregate demand. This is just simple economics.

    If you believe we don't need taxes, that's one thing and our conversation ends there, however, if you do believe we should tax and spend at the national level we should do so in a way that makes the most sense to keep us economically stable, not some notion of 'fair' or 'unfair', which is totally subjective.
  • u
    Nemesis3X
    !
    @AceLuby Where did I say we don't need taxes? The most sense? You guys think that the whole countries financial woes can be solved by taxing the rich, at what 50- 70%? That's ridiculous and unsustainable! We have millions of takers that contribute absolutely NOTHING!!! Let's start simple...... If these millions paid even $1.00 in taxes at the end of the year instead of paying in $2000.00 and getting back a refund of $3000.00 (I mean really, how much sense does that make? Don't say it doesn't happen because we both know it does!) that would be millions of dollars actually contributed. That's what I mean by fair!!! Like I said, I'm all for cutting the loopholes for the rich so they can't fleece the country, but what's good for them is good for the takers! The middle class is getting DP'd by the rich and the poor!
  • View all 7 replies >
  • DerivePI
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    OK, fine. Eliminate coorporate tax on stock distributions and raise the capital gains tax to the current income tax rates. Sure would make things a lot less confusing too.
  • drpeeper
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    Guess they left this out of the video. Soon after taking office in 1981, Reagan signed into law one of the largest tax cuts in the postwar period.

    That legislation -- phased in over three years -- pushed through a 23% across-the-board cut of individual income tax rates. It also called for tax brackets, the standard deduction and personal exemptions to be adjusted for inflation starting in 1984. That would reduce "bracket creep" since the high inflation of the 1970s and early 1980s meant incomes rose very fast, pushing taxpayers into ever higher brackets even though the real value of their income hadn't changed.

    The 1981 bill also made certain business deductions more generous.

    In 1986, Reagan lowered individual income tax rates again, this time in landmark tax reform legislation.

    As a result of the 1981 and 1986 bills, the top income tax rate was slashed from 70% to 28%.
  • drpeeper
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    @AceLuby Again, thanks to the Democrats (Yes in the House). And oddly enough, revenue to the IRS doubled in 8 years.
  • u
    AceLuby
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    While increasing spending faster than any President before him since FDR.

    It's also plainly ignorant to say we don't have a revenue problem. Revenue as a percentage of GDP is the lowest it has been since the depression.
  • u
    classychazy
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    We have problems with both revenue and spending. In fairness they both need remedy for us to have a snowballs chance in hell of changing things around!
  • u
    AceLuby
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    @classychazy Very true, we need to increase revenue to around 20% of GDP and decrease spending to around 20% of GDP. Those goals mean you'll balance the budget. Shrinking spending from 25% to 13% to match revenue while not touching defense is simply a talking point not based anywhere near reality.
  • Thegrif
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    Agreed. they dont seem to get it. Okay raise the tax, but cut the spending. Otherwise the tax raise will accomplish zero. Obama is the one not budging and actually asking for total power to spend at will. Rich aren't going to feel a real burdon from the raise in taxes, but it doesn't seem to make sense to raise taxes, yet Obama spends more than the tax makes.
    The tax increase can run the Fed Gov't for about 8 days, not really enough to matter, but maybe if spending is cut it will work.
  • View all 10 replies >
  • Ashstop
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    I don't think Reagan was talking about 39% of a mans income, I'm sure he was assuming also the most people were paying taxes, not 50% of the country not paying!! Nobody is saying the rich shouldn't pay, break it down to your neighborhood, what if they decided since you made the most then you need to help support everyone else up to 40% of your income, suppose to some that wasn't even working were screaming the loudest you needed to pay your fair share, it wasn't fair you have a income and they don't !
    I agree we need reform, we need a bigger tax base, not more from the half that's paying!!.. We also need to cut spending!! We are no different than the person stealing their kids identity to get credit for ourselves so we can have more!! That's a crime, so is raising the debt ceiling every year! Our kids will have to get by with less because of our greed!!!
  • drpeeper
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    The GOP just gave Obama exactly what he wanted in December 2011- and he turned it down. This isn't about solving a problem. Obama wants to place blame. Nothing more nothing less.
  • Pragmatist
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    The reason so many people in the lower income bracket pay less taxes is because we've been lowering tax rates for the past 60 years... eventually if you keep lower rates across the board... you end up lowering them to zero.

    http://www.taxpolicycenter.org/taxfacts/displ...

    Also... another reason fewer people are paying taxes is because of a bipartisan trend towards giving tax credit instead of using that money for social programs. That is to say instead of the government taking the money away from the poor and giving it back via government programs... they are just reducing their taxes directly. I thought that's what you wanted... or did you only want that for the middle and upper class and not the poor?

    http://www.sfgate.com/news/article/Why-47-or-...
  • PNWest
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    @drpeeper Elections have consequences. The GOP refused to negotiate in good faith before the election because for some unfathomable reason they thought they would win. Now that they have lost they will either do the right thing and raise taxes on the rich or raise taxes on the rest of us by driving the economy over the fiscal cliff. Obama will rightfully get the credit if a deal is reached or the GOP will rightfully get the blame if one is not reached.
  • Ashstop
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    @PNWest
    You are right about part of that! Anything wrong Obama will blame someone else, anything good and his "I's" are to close together
  • martydotcom
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    Extracted from Forbes.com . a site not noted for liberal thought:
    " 60% of those non-income tax paying households did pay federal payroll taxes—meaning Social Security and Medicare taxes.(Considering all Americans households, including those that owed income tax, 62% paid more in payroll taxes than in federal income taxes.)"
  • View all 6 replies >
  • drpeeper
    !
    7 of 8 Reagan budgets were increased by Democrats. 1984 was the exception. The tax INCREASES Reagan did enact- were supposed to be met with Spending Cuts- as promised by the Democrat Congress at the time. For every 1 Dollar of Tax Increases - 1 dollar in spending cuts. Reagan kept his deal- democrats did not. Can't argue this as it is fact.
  • u
    AceLuby
    !
    @drpeeper What a bunch of hogwash. First off, the very first budget he asked for had a $140 billion budget deficit, larger than any since WW2. Secondly, every single budget proposal that Reagan proposed was a best case scenario, assuming 5% growth, low interest rates, low inflation, etc... Simply because reality didn't coincide w/ these proposals is not the Democrats fault. Lastly, the GOP had control of the Senate for 6 of his 8 years, meaning they are just as much to blame for not cutting spending and adding spending as anybody else. The thing you guys absolutely refuse to admit is that the spending and lowering of interest rates (which were raised by Carter) are just as much, if not more so, to blame for the recovery as the tax cuts.
  • u
    Calfarm
    !
    @AceLuby Twice now you have brought up the deficit spending rate increase. Care to acknowledge the fact that in the last four years, spending has surpassed the amount of all other presidents combined. We are now spending over 3 billion dollars per day of borrowed money with no end in sight. Even if the tax rates on the wealthy are increased, we simply cannot make a dent in the deficit that we have obtained under Obama. Currently we are at about 73% of GDP for deficit, a rise of 30+ percent in the last four years. When we hit 90% which is coming quickly based on the current trends, it will be all over. We will not have the ability to pay it back and the American economy will collapse. We must stop the spending period.
  • drpeeper
    !
    @AceLuby Bahahahahaha. The simple fact that you didn't know the House (Not the Senate) has the purse strings- shows how lost you are.
  • jessejaymes
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    The difference in Reagan's day and today is the GOP back then bothered to give lip service to tax fairness. Today the GOP just says screw you, we work for the rich.
  • bsking
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    you don't have to go back to 85 Obama made the same argument the Republicans are making back in July... you remember when he was going around the country lying to everyone so he could get their vote.
  • methinks
    !
    Here's spin for you.

    The guy who made the video is parroting the current Obama stance on raising taxes on the top 2%.

    Reagan was referring to this business executive taking advantage of the tax code to lower his effective income tax rate, which is what Boehner wants to do...AND what Obama said we should do in July 2011. Reagan was NOT advocating raising the tax rate at all. See time index 0:35 and again at 1:52, where he referring to tax loopholes, not an increase in the tax rate.

    Now, Obama is looking to raise cap gains taxes and the income tax rate on these people. Why is he changing his position?

    Must be the puppeteer pulling his strings...
  • u
    AceLuby
    !
    Yes, they are right. When you have a revenue problem you need to find ways to get that revenue without negatively impacting aggregate demand. The only way to do this is targeted tax increases on money that is typically not spent in the economy. This is the reason why taxes on the wealthiest Americans makes the most sense, most of that money is simply not being spent in the economy, therefore to tax it at a higher rate will have little effect on overall demand. This is also why it's a wholly bad idea to say the tax should instead be applied to the poor since ALL of their money is being used in the economy. Therefore, taxing that money is literally taking it out of the economy, making the problem worse. This isn't about 'class warfare', as the right likes to claim, but about making the right economic decisions that will help the deficit while minimizing the impact on the economy as a whole.
  • o
    Sharpshooter
    !
    I remember Ronald Reagan and Axelshaft's Boy is no Ronald Reagan.

    Both men also said "yes" and "My Fellow Americans" at some point, that doesn't make them the same or imply them sharing opinions.

    Reagan was interested in REBUILDING this country after the prototype obama, Jimmah Carter, took his best shot at ruining the country and economy. Axelshafts Boy learned from Jimmah and is doing a better job of running the country into the ground.
  • Keyjo
    !
    In 1985 wasn't the top tax rate, under Reagan, around 50%?
    This is not the first time the Republicans have rejected one of their own previous ideas once embraced by Obama.
    Note to Republicans: America is tired of "politics as usual," role up your sleeves and work with the President. Stop holding back the Nation.
  • u
    Yank
    !
    He did not make the same argument as Obama. He did not say to raise income taxes, but to close tax loop holes (exactly as current Republicans are saying). The Warren Buffet vs. his also 1%er secretary (to even call her a secretary is rather dishonest) is also the vast exception and not the norm. The norm is that the rich already pay most income taxes and the average secretary is going to have almost no federal income tax burden.
  • u
    AceLuby
    !
    Like raising taxes on the wealthy?
    Amnesty for illegals?
    Secret wars?
    Deficit spending faster than anyone before him?

    You're right, Obama will never be able to govern that far to the left.
  • u
    Yank
    !
    The top marginal rate and what is paid are not the same thing. Reagan lowered the top marginal rate and the amount paid increased.
  • truthsayer
    !
    @Bobolinsky I've been thinking the same thing. I can't understand why there is no flat tax say 10% and everybody pay the same rate. Whats fair is fair.
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