WASHINGTON - President Obama admitted this week that the "Buffett Rule," his plan to raise taxes on wealthier Americans, is "a gimmick."
"There are others who are saying: 'Well, this is just a gimmick.
Just taxing millionaires and billionaires, just imposing the Buffett Rule, won't do enough to close the deficit," Obama said Wednesday to a handpicked group of backers the White House gathered here Wednesday.
"Well, I agree," he added. "But the notion that it doesn't solve the entire problem doesn't mean that we shouldn't do it at all."
Where's the logic in that? No, it won't really fix the severe economic problems America faces, but that doesn't mean we shouldn't give it a try.
Actually, raising taxes wouldn't scratch the surface of the gargantuan fiscal and financial mess he has created and that now threatens America's economic security.
The revenue from his Buffett Rule tax increase has been estimated at about $47 billion, a thimble full of what may be needed to pound his huge $1.3 trillion budget deficit into submission. It wouldn't even pay a fraction of the interest on his ballooning $15 trillion debt.
Yet he's made this pathetic excuse for an economic and fiscal agenda the centerpiece of his campaign for another four years.
Before Obama made his "gimmick" remarks, Democrats on Capitol Hill were saying essentially the same thing.
Sen. Chris Coons, Delaware Democrat, acknowledging Republican criticisms of Obama's Buffett Rule, admitted that it "isn't going to balance the budget. This is an issue about fairness."
"I question the priority of doing this right now," said Former Democratic National Committee Chairman Tim Kaine. "This is tripping over dollar bills to pick up pennies."
So that's what Obama is peddling in this fiscal snake oil remedy that the Senate will vote on next week -- pennies disguised as fairness.
Obama says it isn't fair that wealthy Americans like billionaire Warren Buffett pay a 15 percent tax rate on their income, while other taxpayers pay a higher rate on lower incomes.
Here's what's wrong with Obama's foggy thinking which is sorely in need of an economic overhaul:
1. Obama's tax hike plan is aimed at the capital gains tax which was cut from 20 percent to 15 percent in 2001. That tax, which is levied on dividends, interest and capital gains from stocks, is lower than regular middle income tax rates because the government wants to encourage investment.
Whenever the capital gains tax has been raised, as Obama wants to do, it discourages the sale of assets and reduces badly needed investment in our economy. That will lower tax revenues and worsen the deficit. That's what will happen if Obama has his way.
2. Billionaires and millionaires benefit from a lower capital gains tax because almost all of their income comes from capital investment in our economy. But they're not the only ones who benefit from the lower tax. More than half of all American workers who save for their retirement years by investing in stocks, mutual funds or other assets also pay the same rate that Buffett does on their capital gains and dividend income. But Obama doesn't seem to understand this or conveniently chooses to ignore it because it sounds fair.
3. Warren Buffet's secretary, who he said paid a higher tax rate than he does, probably invests in stocks, too, and the tax rate on her capital gains and dividends is the same rate that her boss pays.
Millions of retirees today, who do not think of themselves as rich, live off the cap gains and dividends from a lifetime of savings and investment and pay 15 percent on that portion of their income.
But while Obama is ranting about "fairness" in the tax code, that isn't the problem facing our country or that most Americans care about right now. What they're worried sick about is a weak economy that's barely growing at a snail's pace and the need for good paying jobs that are in short supply.
This is the legacy of Obamanomics. He isn't talking about about growing the economy or jobs or incentives to boost capital investment to escalate new business creation that is the wellspring of a prosperous, capitalist country.
No, he wants to distract voters from his failures on the economy by playing the class warfare card and calling for inserting some theoretical egalitarian fairness into the tax code.
While this hat trick appeal to many Americans, polls suggest that it may not be enough to keep him from becoming a one term president.
A poll of 1,000 independents in 12 battleground states, released by the centrist Democratic group Third Way, found that 80 percent of independent-minded voters who did not have a strongly held views about Mitt Romney or Obama said they were more likely to vote for a candidate who focused on economic growth and jobs.
That bodes well for Romney because economic growth, jobs and creating an "opportunity society" remain at the heart of his presidential campaign.
What this economy needs right now is a strong dose of tax reform that that lowers the oppressive 35 percent tax rate on corporations, reduces the capital gains tax rate even further to give business investment a booster shot, and lowers marginal income tax rates for the middle class.
That's what Obama's very own bipartisan budget-cutting commission proposed in a plan that would have cleansed the tax code of needless exemptions, deductions and loopholes, only to be given the cold shoulder by the White House.
Republican leaders in Congress are pushing the Bowles-Simpson plan but not the Obama campaign who think they can win in November by campaigning on "fairness" instead of economic growth and tax reform.
But even the national news media is getting fed up with Obama's empty class warfare rhetoric at a time when the country is crying out for economic policy reforms to get the country moving again.
Dana Milbank, the Washington Post's fire-breathing liberal columnist, says his patience is wearing thin: "Three years into his presidency, Obama has not introduced a plan for comprehensive tax reform -- arguably the most important vehicle for fixing the nation's finances and boosting long-term economic growth."
Tax cut crusader Jack Kemp, and Ronald Reagan for that matter, couldn't have said it any better.