Taxes

Biden Said His Tax Hikes Would Only Affect the Rich. He Can't Keep That Promise.

Workers will suffer.

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Politicians betray their campaign promises all the time. So, it's no surprise to see President Joe Biden go back on his word that, in spite of his plan to significantly hike taxes to pay for a portion of a massive increase in spending, nobody earning less than $400,000 annually would suffer a tax increase. But this flip-flop is just the tip of the iceberg.

During the presidential campaign, then-candidate Biden declared that if someone makes less than $400,000, they wouldn't face any tax hikes. His campaign website reinforced this promise: "Joe Biden will not raise taxes on anyone making less than $400,000. Period." The president recently reiterated his promise on "Good Morning America" when he said, "Anybody making more than $400,000 will see a small to a significant tax increase," and "You make less than $400,000, you won't see one single penny in additional federal tax."

But then his press secretary, Jen Psaki, announced during a press conference that the threshold of $400,000 refers to family income. She contradicted herself a few days later, saying, "The president remains committed to his pledge from the campaign that nobody making under $400,000 a year will have their taxes increased."

Either the administration still isn't fully clear on where it stands, or some taxpayers may be in for a big surprise—or both.

Either way, the sad truth is that with this president's insane propensity for unconstrained government spending, he shouldn't make such a promise in the first place. He has already added $1.9 trillion to the enormously inflated federal credit card and is planning on throwing another almost $4 trillion on it in what he deems infrastructure spending. If he sticks to his campaign promises, Biden plans to splurge $11 trillion in additional spending over a decade. Meanwhile, his proposed tax hikes are estimated to reap $2.1 to $2.8 trillion. In other words, for every $5 or $6 in new spending, $1 will be paid for in new taxes, and the rest goes on the nation's credit card.

I know that's what politicians do, but that's still not right. If he wants to raise spending to that level, everyone should pay some price for this growth in government, not simply those earning more than $400,000. That criticism applies to every president before him and will, I'm sure, to many after him.

It's time for the Democrats who elect presidents that promise not to jack up taxes on anybody but the rich to come to terms with something: These politicians can't continue to spend that much money without raising taxes on nearly everyone, and that includes some regressive taxes. I don't like it, since I'd prefer the size and scope of government to be significantly smaller—but this reality is not optional.

Here's another reason why Biden was never going to be able to keep his promise: He already announced his intention to increase the corporate income tax from the current 21 percent to 28 percent. The reality here is that the corporations that he says are going to send bigger checks to the Internal Revenue Service (IRS) after the tax hike aren't the ones who actually shoulder this heavier tax burden.

The best explanation I've seen on this comes from a 2004 quote by economist Stephen Entin, who wrote, "The economic burden of a tax frequently does not rest with the person or business who has the statutory liability for paying the tax to the government." That's because taxes are ultimately only paid by people.

In this case, the burden of Biden's corporate tax-rate hike will inevitably fall on corporations' workers and shareholders (which includes almost everyone with a retirement plan), many of whom earn much less than $400,000 a year. Workers might not personally be sending more or bigger checks to the IRS, but they will still suffer higher taxation in the form of lower wages, as well as higher prices for consumer goods and services.

Economists aren't sure how much of the hike will fall on workers. Estimates range from 66 percent to 100 percent of the tax falling on workers in the form of lower wages. The bottom line is that nobody can determine who truly bears the burden of a tax just by looking at where or on whom it is formally imposed, despite what the tax is called. But one thing is sure: Biden's promise not to raise taxes on individuals making less than $400,000 is bunk.

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  1. Yes of course this is all true. For now the rich are happy to pay extra tax because they see it as way to appease the masses: “If I pay more taxes then you promise not to eat me.” However they will discover to their chagrin that the appetite of the socialists is insatiable. Furthermore there are simply few lucrative opportunities left under capitalism despite the people who will angrily accuse me of lying for saying that. But that just exposes their defensiveness because they know it’s true. Socialism seems like the only option: create a crisis and exploit it for profit and power (medicare for all, UBI, gun control, GND, etc).

    Fortunately there is a solution: the rich should fund resort colonies so people can retire and leave jobs for others to work and support themselves and thereby obviate big government and charity completely. This would also reduce greenhouse emissions and allow the robots to take over peacefully. Win-win-win – it’s the path to paradise!

    1. … there are simply few lucrative opportunities left under capitalism…
      A total lie you insist on repeating.

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        1. And thanks to Joe you won’t pay a penny more in taxes!

          1. Probably keep his/her doctor as well!

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      2. Prove it’s a lie or you’re a complete hypocrite:

        1. It’s blatantly obvious to any non Marxist.

          ie. Self evident.

          So, fuck off slaver.

          1. Oh, now that’s empirical proof that what you have to say has validity.
            /S

        2. There are still vast markets for capital and consumer goods. Why? Profits…

          1. And every effort makes even more of them.

    2. re: “there are simply few lucrative opportunities left under capitalism”

      Add me to the list of people saying that is simply untrue. There are many lucrative opportunities left under capitalism. The problem is that they all require you to either work hard or have specialized skills (the attainment of which usually requires the aforementioned hard work). And who wants to work hard? The appeal of socialism is that you can directly benefit from the hard work of others without doing the hard work yourself. And it works great until the suckers figure out the game and stop working hard, too. From then on, everyone’s poor together.

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  2. Biden is looking a bigger disaster then I assumed he’d be. He has no understanding of economics .Tax hikes never bring the revenue they promise they will. As said, corps don’t pay taxes, people do and taxing investment [capital gains] is a terrible way to raise revenue. People will adjust their behavior to avoid paying any more then they have to pay. I guess his war on oi and gas is next. We are truly screwed.

    1. Biden has never voted against a tax raise. I believe that his record is 33-0 on tax increases.
      Delaware has been in the top three for welfare states during Biden’s entire career. I expected no less.

      1. He has been a senator for 120 years, (or so he thinks). So more than 33-0.

    2. Biden is essentially declaring war on the middle class, with tax hikes that will ultimately fall on the shoulders of workers and consumers, oil and gas policies that have already raised the price of gas by sixty cents or more, GND policies, gun control policies, and housing policies to eliminate single family zoning (bye bye suburbs).

      You can’t have socialism with a thriving middle class.

      1. Hey, at least he’s awful within normal parameters.

      2. “You can’t have socialism with a thriving middle class.”

        LOLwut?

        Oh, you must be one of those ‘socialism has never failed, because socialism has never been tried” morons.

        1. No, I think he’s saying that if you have a lot of people who are able to work their way out of poverty successfully, it’s hard to have socialism. Socialism requires the haves and the have nots, the proletariate and the burgeoisie; the self-employed, independent contractors, people working a job and running a business on the side, capitalists living off of interest, owned properties, and shrewd investments can’t be tolerated. Wreckers and Kulaks, every one of them.

          1. Ok, I see that now. Sorry for being so harsh.

            But I still disagree with that. Because you don’t need an actual underclass, all you need is envy and opportunists.

            Think AOC

      3. No one in the “middle class” takes home six figures, let alone $400K.

        1. Keep up with inflation. When I was a kid, a $400K income was huge, but that was 50 years ago. In the USA, $400K isn’t very high any more for professionals, or for a two-income family in a high-cost area. There are many cities where buying or renting a family-sized residence will take over half of a $400K income.

        2. A nurse practitioner or physician assistant might make a bare six figures.

          They are not remotely upper class.

          1. Hell, a hard working field plumber can bring down that.

    3. Democrats never understand economics, and republicans only pretend they do when a democrat is in office.

      Heads they win, tails we lose.

    4. Hey, at least the Mean Tweeter isn’t dictator anymore…

    5. I say that all the time. And yet, I get flamed like crazy. Even here on the Reason forums.

  3. It’s sad that politicians have zero understanding of economics. But it’s infuriating that all of them will either not associate with or at least not listen to any advisors who do. This is because, in their minds, they know better. They fancy themselves to be experts on everything.

    Extreme arrogance is a requirement for being a politician. Add in narcissistic personal disorder and habitual lying, and you’re likely to be an especially successful politician. My friends wonder why I have such contempt for every politician. This is why.

    1. Word

      1. Also every actor

    2. Wrong. Progressives hang on every word from Paul Krugman.

      1. One of the great useful idiots of this or any time.

      2. Only conservatives believe or would state that.

    3. Politicians understand economics just fine. That’s why the tax code is loaded with exemptions. They also know that no one is actually ever going to pay the top rate, because the tax code is loaded with exemptions, and anyone in the top bracket can afford a good tax attorney to minimize their tax liability. Any additional cost to corportations will just be passed on to comsumers. The people who are going to take the hit are the middle class, in the form of higher cost of living and stagnant salaries, and this is by design. Socialists hate the middle class, because a properous, healthy middle class is the biggest obstacle to socialism. They’re going to bleed us dry over the mext four years.

      1. “Politicians understand economics just fine. That’s why the tax code is loaded with exemptions.”

        Only if “economics” you mean “that which fills my campaign coffers.”

        Because that is why politicians tinker with the law – not because they understand or care one whit about the net effect, but because it benefits their re-election chances.

        1. That’s bottom line. They pander to the wealthy and the corporation who pay re-election campaign bills with dark money. In pay to play, if you don’t PLAY you do not get re-elected.

    4. “It’s sad that politicians have zero understanding of economics. But it’s infuriating that all of them will either not associate with or at least not listen to any advisors who do. This is because, in their minds, they know better. They fancy themselves to be experts on everything.”

      Your description fits Donnie to a T.

      Left/right, the horseshoe horse shit is the same.

      1. “Donnie” did a pretty good job of cutting my taxes, TDS-addled asshole.

    5. Are you talking about cops or, politicians?

  4. He Can’t Keep That Promise.
    NO HE LIED!
    Biden knew all along he had trillion dollar spending policies, so he knew he would have to raise taxes. Again HE LIED!
    Get used to it, that is what dictators do!

  5. He Can’t Keep That Promise.
    NO HE LIED!
    Biden knew all along he had trillion dollar spending policies, so he knew he would have to raise taxes. Again HE LIED!
    Biden is a liar, Biden has always been a liar, Biden will continue to be a liar.
    Get used to it, that is what dictators do!

    1. He has been a liar for 120 years!

      1. You and I know that but the new, woke, socialist, left wing un-Reason will never say it. If un-Reason published on paper it wouldn’t even be good to wipe your ass with. It would have to many holes in it!

    2. Biden Said His Tax Hikes Would Only Affect the Rich. He Can’t Keep That Promise.
      Wait a minute. Joe’s No Malarkey tour proved he’s a straight shooter.

      1. It only proved he “ain’t black”.

      2. Biden’s definition of rich: Anyone making over $2.00 an hour.

  6. Joe Biden says a lot of shit. He doesn’t mean a word of it. It’s questionable whether he even knows what he’s saying at this point, he’s just reading whatever’s written on the teleprompter. Going back to when he was plagiarizing in college, Joe Biden is incapable of having an original thought, he’s a dunce. But he’s still about a million times smarter than Kamala Harris so you’d better pray for his health and well-being.

    1. Of the 20 Democrats on the stage at the convention, Biden and Harris were dead last in my book. Harris promised a total of 71 trillion in spending, cackling all the way. Free health care for illegals. Free college for illegals, etc. Even veterans don’t get free healthcare.

      1. TANSTAAFL!

        But, don’t tell the proletariat that. They’re sure there must be that free lunch somewhere. And, they’ll vote for anyone who promises to deliver it to them.

        Just ask Bernie.

    2. Yeah. We are screwed with him and without him. can’t wait for more taxes. Just can’t wait.

    3. You say a lot of shit, thank gawd you aren’t POTUS, and you decidedly do not have the acumen Harris has as VP. What did you do today as your total worth besides wander over to the computer to troll websites?

    4. You got it.

      Everytime I see a picture of the VP, I see that shit eating grin of hers and wonder why so many people (I live near Oakland) think she’s wonderful.

      If she were a white male with that same grin (think Trump) they’d be rioting.

  7. Veronique, for a PhD, I am surprised you cannot tell a promise from a lie.

    1. It’s in the Reason stylebook.

      All Democrat politicians must be given the presumption of bona fides. While Republicans are always assumed to be acting from mala fides.

  8. If you own shares in a company, a tax on the company is a tax on you. And a lot of people under $400k own shares in companies.

    1. Ostensibly, it would mean that you would make less money in your investment portfolio, but then again… The middle class isn’t making 400 K a year nor do they have enough to invest in the stock market because they are barely making the mortgage. Rich people problems…

      1. You retarded folks are really catching on to puters and the internets…

    2. True. But many don’t realize it.

      Financial ignorance is bliss. We can just let the government figure it all out for us.

  9. Why are only White people’s taxes expected to pay for their assimilation out of existence by unlimited third-world immigration and FORCE integration into EVERY White country and ONLY White countries? Nobody demands that the Chinese must pay for their assimilation out of existence by breeding with millions of non-Chinese in their own country. Diversity is a code word for White Genocide.

  10. Only balancing it back where it needs to be so the rich pay their fair share. If they don’t like it they can fuck off to another country where they’ll pay…..the same, or more. Oh well.

    1. That will teach then for being successful.

      1. I wish it would teach them some humanity, sense of fairness and responsibility, but no: it teaches unbridled greed.

        1. Not like the bridled greed of those wishing to steal their stuff…

    2. “living wage”, “fair share”… leftists won’t ever assign actual numbers to these terms, because they know in their black evil hearts that what the terms always mean is “more than whatever the current amount is.”

      1. In the final analysis, they don’t want any wages at all.
        Just do your assigned job, and take the housing and food allowed.
        No money, no worries.
        And as a side benefit, you will own all of the means of production. (through the state, of course)

    3. If you actually think that anyone in the top bracket is going to pay more money in taxes, you’re an idiot. Corporations don’t pay taxes- comsumers do, either through higher prices or decreased quality and service. If you think it’s going to bone anyone other than the middle class, who are going to see their IRAs take a dump and their cost of living skyrocket, you’re an idiot.

      “The Rich” are NEVER going to get boned, especially by the democrats, who are the party of corporations and rich donors.

      1. You nailed it. Jeff is an idiot.

        He’s also a dishonest little shit who pretends to be a libertarian when he uses other socks.

    4. And it’s just a coincidence that you already pay your fair share, isn’t it?

      1. Don’t be silly, raspberry doesn’t pay any income tax.

    5. I’d point out how full of shit you are, but the fact that you wrote that indicates the points made would be over your head.

      Capitalism is the optimal system for lifting the greatest number of people’s standard of living. The problem is we haven’t had free-market capitalism in America for decades. It’s all cronyism with the deck stacked in favor of the corporate interests…which is as far from real capitalism as is communism.

    6. raspberrydinners
      April.1.2021 at 9:44 am

      Make your family proud; fuck off and die, asshole.

    7. Just rescind the Trump giveaway and we will be ahead of the game. While they are at it, they can eliminate all the tax loopholes and deductions the corporations got to keep while the rest of us rabble got them all taken away.

      1. Allowing people to keep more of their own money is not a giveaway, except to a statist thief…

      2. “Just rescind the Trump giveaway and we will be ahead of the game. While they are at it, they can eliminate all the tax loopholes and deductions the corporations got to keep while the rest of us rabble got them all taken away.”

        Make your family proud, TDS-addled asshole; fuck off and die.

    8. Yeah. Those damn rich bastards, they’ve got everything I don’t have. Especially that Mr. Exxon and Mr. Amazon who live just over the hill from me.

      Please pass the popcorn so I can continue watching pro sports where neanderthals are paid tens of millions per year and I don’t see the dichotomy at all.

  11. de Milquetoast.

  12. If you’ve never had the government draw an income line and say, “people like you need to pay your fair share,” then you’re really not entitled to have an opinion on other people’s fair shares.

  13. Biden the pandering pomposity. Of course all taxes affect all people directly or indirectly. He must have a particularly ignorant base and a very compliant Congress. Oofah> end this shit.

  14. get paid over $190 per hour working from home with 2 kids at home. i never thought i’d be able to do it but my best friend earns over 15k a month doing this and she convinced me to try. the potential with this is endless…..www.scansweb.com

  15. I mean, this was patently obvious to anyone with half a brain before the election. The doddering old fool straight up said he would work to repeal the 2017 tax cuts, which would automatically raise taxes on the middle class.

    If only there had been someone else, anyone else, to vote for…

    1. Nobody is always an option – our “elections” are a made-for-TV reality show farce anyway.

      1. Love it!

      2. And, the best presidents are Godlike, benevolent dictators.

        What the hell is a legislative branch anyway? Or that SCOTUS stuff?

        I’ll take that pretty boy Newsom any day. He’s so dreamy.

  16. Seriously, what a P.O.S. Not like ANY of them are worth a damn anymore. I just laugh when dems flaunt how they cannot do math. anyone could see he doesn’t understand budgeting.

  17. The government gamgsters will never be satisfied until they have complete control of everything you earn and every assest you own.

  18. Not really possible to have a tax increase that only impacts the rich.

    Some high earners are self-employed which could mean if they pay more their cost of doing business goes up thus their prices have to go up as well. This means all their customers pay more.

    Raise taxes on corporations and those costs are then just put right back into the prices that all customers pay as taxes are just a part of the total cost of doing business.

    Only a retard would believe that you can only tax the rich and companies while leaving lower earners alone. The only way to lower taxes for upper middle class and down is to cut income tax rates. All the bullshit with increase child deductions, child care deductions, etc. target specific people.

    Our government blows ass.

    1. Tell me about it.

      If you look at my 2019 income tax return you’d call me “rich”. I paid as much in Federal income taxes as I used to earn in a year before I retired.

      If you look at my 2020 income tax return you’d call me “poor”. I didn’t pay any Federal income tax.

      So, what does that make me? What am I, rich or poor?

      And no, I’m not self employed. I’m retired. This is just what can happen for so many reasons. To many to list here.

  19. Biden speaks before he thinks but since he can not think he mutters nonsense. Any and every tax hike hurts everyone. Raising corporate taxes increases corporate cost of business which is subtracted from their profits, but those profits are made up by increasing product prices. Increasing prices hurt everybody but the rich, especially the working poor. Biden can not think. The other thing is that nonsense about income over $400,000 is not true either. Those with income over four hundred gran, use the same investments that everyone with a company or union pension use. Tax increases hit them too. Pension plan lose money to taxes. That is money that does not get into pension payments. This goes all the way from the top to the bottom.

  20. Only morons who work for crummy webzines believed his promises.

  21. Eisenhower had a top tax rate on the rich around 70%. Reagan had 11 tax increases. Bill Clinton actually balanced the budget deficit when he left office.

    In the 21st Century Bush and the GOP-controlled Congress, spent money like drunken sailors (even if you deduct wartime spending). Bush did all of this spending, without paying for it, by handing the credit card Bill to our children and grand-children. Bush cut revenue while simultaneously borrowing more money, almost creating a second Great Depression.

    When Obama inherited this s***storm, he repaired this mess and left office with a deficit lower than he inherited from Bush.

    1. And what are you going to be saying about Biden?

  22. Who cares!!! It’s just taxes. It’s just our money. The important thing here is no more mean tweets!!!

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