In Barack Obama’s ongoing battle to raise taxes on “the rich” (a struggle he pursues with comparable focus and ferocity to his recently celebrated efforts against Al Qaeda), the president employs a nasty rhetorical tactic that deliberately blurs an essential distinction. In recent public appearances, the president frequently assaults Republican fiscal policies for seeking to “balance the budget on the backs of the poor and the middle class” in order to give “lavish tax cuts to millionaires and billionaires.”
Aside from the misleading characterization of his opponents’ priorities (no, resisting tax increases isn’t the same as delivering new tax cuts) and purposes (balancing the budget is a crucial end in itself, not merely a means to lower tax rates), White House rhetoric dishonestly and repeatedly lumps together “billionaires” and “millionaires.” President Obama and his allies apparently consider billionaires and millionaires equally guilty of unwarranted success, and equally deserving of sharp hikes in their IRS obligations.
On the face of it, this equivalence is absurd and misleading: an individual with a net worth of a billion dollars is literally a thousand times richer than a citizen who’s accumulated a million dollars.
Comparing billionaires and millionaires would be the equivalent of comparing a struggling, working class citizen who’s saved, say, only $10,000 in the course of a lifetime of labor with someone who’s accumulated $10 million dollars—the wealthier guy controls a thousand times more money than the humble worker, just as the billionaire by definition holds a thousand times more money than a mere millionaire.
By lumping together billionaires and millionaires, Mr. Obama equates people who count as undeniably wealthy with some ordinary middle class folks who have made prudent provisions for their own retirement.
For instance, imagine a hardworking couple approaching the age of 65 that’s scrimped and saved in order to put aside a million dollars for their retirement. If they wanted to cover 25 years of post-retirement living (not an absurd plan given today’s rising life expectancy), they would need to survive on less than $50,000 a year to provide for all their needs (given the very modest returns on today’s secure investments). This could sustain a decent middle class life, but no one could claim that $50,000 a year provides a luxurious or lavish retirement.