Angelika Our Christmas tree is patiently waiting on the balcony for its big appearance. A sure sign that December 24th is approaching. Unfortunately, work took over a bit this year, so there was only time for five newsletters. We promise to do better in 2012.
The defining theme in 2011 was the protest movements: from the "Wutbürger" (angry citizens) who opposed the Stuttgart train station, to the Occupy Wall Street movement that began in New York City, to the so-called Arab Spring. The American "TIME" magazine also chose the anonymous protester as the Person of the Year. Since 1927, the magazine has followed the tradition of dedicating the cover story to the person or group of people who, in the editors' opinion, most influenced the year. Pope John Paul II, Bill Clinton, Amazon founder Jeffrey Bezos, as well as controversial figures like Stalin or Khomeini, have already made it to the cover.
A movement of a somewhat different kind can be found in the group of American Patriotic Millionaires for Fiscal Strength, who kindly request to be allowed to pay more taxes. They are trying to persuade politicians in Congress to impose fairer tax rates on the super-rich, including themselves.
Yes, you read that correctly, they consider their tax rates to be too low. This is because most wealthy individuals derive a significant portion of their wealth from securities and similar investments, resulting in many paying only 15% instead of 35% tax on dividends and 15% instead of 20% on capital gains, following the tax reform implemented by Bush at the time. Bush also reduced the top income tax rate from 39.6% to 35%. Warren Buffett, one of the richest men in the USA, who has long advocated for higher taxes for the wealthy, has already stated that his secretary pays a higher tax rate than he does.
Buffett is a vehement advocate of the inheritance tax, as the Republican Party repeatedly makes attempts to abolish it entirely. Buffett also considers it a myth that higher tax rates prevent people like him from investing or creating jobs. The standard argument of Republicans is that low taxes stimulate the economy and high taxes slow it down. However, this argument cannot necessarily be supported by facts, as today's American tax rates are at a historic low, and yet the economy is recovering only very slowly, while it boomed under Bill Clinton with higher tax rates.
Malicious tongues accuse the group of patriotic millionaires of not being prevented from paying more taxes to the tax office. However, in their opinion, sending a one-time check to the tax office does not solve the problem. It remains exciting to see what influence the millionaires of the movement will ultimately have.
Christmas greetings from the land of diverse ideas!
Angelika und Michael