President Obama is telling us that billionaires and millionaires are not paying their fair share of taxes.  All evidence to the contrary, the top five percent of income earners in this country fund 40% of the federal government.  The top ten percent fund 70% of the government.  The top fifty percent fund 97%.  The bottom forty-six percent pays no federal income taxes at all.  Who is not paying their fair share?

I reject the premise that "the rich" are not paying their fair share.  I reject the premise that somehow there is something wrong if Warren Buffet's effective tax rate is lower than that of his secretary.  Pay yourself a salary Mr. Buffet and stop misleading the people of America as you do when you compare your capital gains income to your secretary's ordinary income.  We proved years ago that a reduction in capital gains rates increases economic growth.  An increase in capital gains rates will conversely shrink capital seed money and thus slow down the growth of the economy.

There is a problem of perspective.  We should all reject the premise that our purpose for being on this earth and citizens of this country is to fund the federal government.  The government has become the focus and it should never be.  The government is only a part of the economy.

Consider the US Economy as a large balloon.  Inside that balloon is the Government.  Government consumes and more recently, Government distributes wealth from those of plenty to those of need.  Government is also an employer but it funds its payroll with money confiscated from the taxpayer.  The largest majority of those inside this economic balloon are citizens that consist of both workers and consumers.  All workers are consumers but not all consumers are necessarily workers.  The other component in that balloon is the Capitalists.  The Capitalists are those who through their hard work or sometimes through inheritance have amassed large amounts of wealth that will either be 

Workers may or may not have the money to invest in the economy.  Many do through their pension programs and savings but these amounts do not compare individually to the wealth of the billionaires or the millionaires.

When Government uses its capacity to move money from taxpayer to dependent there is a negative effect on the economy.  It does not grow the economy when you take money from Sally and give it to Harry.  What transfer payments do is take buying decisions away from Sally and give those buying decisions to Harry.  Government has not created wealth.  If Sally is wealthy, Government is taking investment decisions from Sally in order for Harry to make consumption decisions.  If Sally gets to keep it, it remains as capital free to expand the economy into a bigger balloon.  Certainly Harry will consume his stipend within the economy but it will not be concentrated in a single area as it would be had it remained in the investment pool.  A million dollars left in the hands of Sally can be the seed money for a business that will hire people to make things and / or provide needed services.  The people Sally's business hires will pay taxes.  These employees are then contributors, not dependents of the Government.

Government can only consume.  We should not be asking what is fair in relationship to who funds the Government.  We should ask whether we are using our collective incomes effectively.  The fact that Warren Buffet pays a lower tax rate than his secretary is of no real relevance.  Warren Buffet's money is at work in the economy in different ways.  Unless Buffet stuffs his money in his mattress, it is working to grow the economy in ways more effective than Government can ever be as a consumer or a distributor of Warren Buffet's wealth.

Thus, I caution everyone to think of the entire economy, not just the Government.  I also caution everyone to remember that our economic balloon will grow strongest when capital remains in the economy and is not consumed.  Those dollars the wealthy get to keep are dollars that will help you or perhaps help me remain employed.