"Top 2% Not Job Creators Or Millionaires In Tax Debate," is the headline over a Bloomberg News article that reports:
President Barack Obama describes them as "millionaires and billionaires" who can afford to pay higher taxes. Republicans call them "job creators" who need to keep their money so they can hire more workers.
As the Democratic president and his Republican opponents debate whether to extend the George W. Bush-era tax cuts for the top 2 percent of U.S. taxpayers -- individuals earning more than $200,000 a year and married couples making more than $250,000 -- their poll-tested phrases obscure the truth about who would be affected.
They are two-earner professional couples living on the East and West Coasts, doctors, lawyers, engineers and Wall Street executives. Few are billionaires or earn more than $1 million a year, and most are not employers.
This adopts a pose of even-handedness — Obama and Republicans are both wrong. But it's flawed, and unsupported by the facts in the article. First of all, at some point the popular definition of "millionaire" seems to have changed from someone who had $1 million or more in assets or net worth to someone who makes more than $1 million a year in income. Obama may be using the old, asset-based definition; Bloomberg seems to fault him for not using the new, income-based definition. But the old, asset-based definition is still operative in dictionaries, and it still is the definition Bloomberg seems to use for "billionaires."
Second, the Bloomberg article supports its "most are not employers" statement with the evidence that "In the top two tax brackets, slightly more than one-third -- 35.5 percent -- were employers receiving business income, according to 2007 figures from the Treasury Department." That's five-year-old data, and it may or may not still apply in 2012. Also, one can be a "job-creator" without receiving business income. If some two-earner doctor or lawyer or professor couple take their income as salary rather than as "business income," and if they hire domestic employees to take care of their children or clean the house while they are working, they are creating jobs, even though they don't fit that Treasury Department definition. If the same couple hires construction workers to build a weekend house, or eats out at a restaurant and pays money that supports the jobs of the cooks and waiters, or invests retirement money in shares of a company that hires workers — all those activities create or support jobs, even though they don't necessarily fit the Bloomberg-Treasury department definition. Finally, I know some doctors, lawyers, and Wall Street executives, and they are all employers in one way or another. The doctors may hire nurses or medical secretaries or billing assistants, the lawyers may hire summer associates or paralegals. The employment may not be run through the doctor or lawyer's own personal tax returns, but on a functional basis, these people are employers and job creators.
Anyway, I don't want to get too bogged down in definitional questions, but that seems like the whole point of the Bloomberg article, to use definitional questions to make the point that Obama can raise taxes without hurting jobs.