Tax millionaires? Why not help all get ahead?

Published: Thursday, Sept. 22 2011 9:36 a.m. MDT

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It's been a tough week for the rich in America, between the White House chasing them around with a snapping tax whip and one of their own, Warren Buffett, admitting he pays less in taxes than his poor, impoverished secretary.

But then, we Americans always have had a complicated relationship with the rich. On one level, we may resent them, but you could go broke betting on us actually hating them or wanting to punish them. Simply put, many of us still hold out the hope we can become one.

Or, as Newsweek's Jerry Adler wrote two years ago, "People who expect to join a country club someday are, obviously, less likely to want to burn it down now."

President Obama may be playing to his liberal base when he rails about millionaires paying higher taxes and paints misleading stereotypes about rich people paying less than the middle class (they don't, generally), but he is treading on unstable ground with the rest of us.

Truth is, a lot of us are confused about what it means to be rich. In a study titled, "Is this a great country? Upward mobility and the chance for riches in contemporary America," Columbia University professor Thomas A. DiPrete cited a Gallup poll that found 51 percent of Americans in the 18-29 age group thought it likely they would be rich some day. So did 51 percent of those who earned more than $75,000 per year (the study was published in 2005).

But other surveys have found that people who earn less than $30,000 defined rich as earning $74,000, while those who made between $30,000 and $50,000 put that figure at $100,000. Only 13 percent of Americans set the threshold for "rich" at $1 million.

Which may have given the president the idea he could pick on those folks.

Still, picking on folks doesn't seem like a good strategy for getting the nation to unite behind an effort to pull the economic wagon out of the ditch. That may be especially true if being rich is a state of mind, and a rather pleasant one, at that.

A better strategy would be to forget the rich-vs.-poor grudge match and focus on ways to improve economic freedom for everyone.

This week, the libertarian Cato Institute released its latest index of economic freedom, an annual report that ranks nations by several categories ranging from the size of government to the security of property rights.

The news isn't good for the United States. Until a few years ago, the U.S. consistently ranked third or fourth in terms of economic freedom. Now it has slipped to 10th. It ranks 54th in size of government and 44th in the freedom to trade internationally.

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