Phil Mickelson got himself in a little political hot water by commenting at Sunday's Humana Golf Challenge on how the new higher federal and California state taxes will change the way he operates going forward. He stated in an interview, "If you add up all the federal and you look at the disability and the unemployment and the Social Security and the state, my tax rate's 62, 63 percent," he said. "So I've got to make some decisions on what I'm going to do." What that means if you read between the lines is that Phil may well be leaving California and their high state taxes for a state with much lower taxes. (Florida has no state income tax for example)
It's easy to pick on Phil who makes an estimated 40 million per year in prize money and endorsements and say he's "not paying his fair share". Even at 65% taxes he's making more than 99% of Americans! But is it really unfair?
Phil gives back to the community millions every year through his charities "Birdies For The Brave" and "Special Operations Warrior Foundation" as well as his time. He also donates $100 for every birdie and $500 for every eagle he makes to "Homes For Our Troops" You can read more about all of Phi's charitable work here
Is it unreasonalbe, or "unfair" if you will, for the gov't to ask Phil to give 60% of all his income to the gov't? Let's look at it this way...Phil will make approx 40 million dollars this year. Under the new tax code he'll pay an additional 20% or so in taxes. That amounts to 24 million in taxes for THE SAME services that you or I pay 1/100th for and half the country pays zero for. So to believe the Obama administration and the State of California, it is somehow unfair that last year Phil would ONLY have to pay 20 million for the same services someone making $75K a year would pay 10K or so for, and those making less than 50K might pay nothing for?
The gov't has a spending problem, not a tax revenue problem. The Obama administration and the Democrats in general have decided that rather than tackle spending and entitlements run wild, they'll pick out a small group (the wealthy) and blame them. "If they'd only pay their fair share we'd be fine." But would we? Even with this huge tax increase on the wealthiest Americans the gov't will only take in about 1% more than they do now! Enough to pay for federal spending for a little over a week. And what do you think the gov't will do with this extra revenue? Right, spend it!
We need leadership that will stop demonizing the rich and buying votes from "the poor" by making entitlements easier and easier to qualify for. Food stamps are up by double the last 4 years. Was that because twice as many people were desperate or because twice as many people qualified under relaxed standards and programs designed to enlist more and more people to the ranks of gov't subsidized?
Let's talk about something basic like a federal budget. This administration and Democratically controlled Senate has not passed a budget (mandated to do so btw) in 4 years. Why not? Because if you have a budget you have to limit your spending. If you don't have a budget then you just keep spending and printing money and raise the debt limit every 6 months.
Back to Phil: Phil pulled out of a deal in August to buy a piece of the San Diego Padres. He reportedly did so because of the huge tax increases. Why risk millions of dollars on a team that may well lose money, if you are going to only keep 35% of a profit if there is one? That has been the argument from the right on the increase in capital gains taxes all along. Phil would have to take money he already paid taxes on, risk it in this investment, and IF the team makes any money the gov't will take 65% of it! If it loses money that's all on Phil. This is true in every area of investment. Just like Phil backed out of this deal, investors all across the country will decide not to invest because the risk is too high and the return too low. Does this mean "the poor rich" won't be able to invest and make millions more only? No, it means that investment goes down across the board, jobs are not created, building are not built, stadiums are not funded, workers don't get new jobs that investment pays for.
All the "unintended-intended" consequences of the rich "paying their fair share."
Phil is in full back peddle mode now, as his image is his ticket to endorsements. But while Phil may be back peddling a bit, he's doing what every other investor in the country is doing. Holding onto their money and moving to states that don't spend like there's a money tree.
Quick analogy.. You go to Burger King for lunch. They start pricing their value meals like the gov't charges taxes. If you make under $20K your meal is free. If you make 60K it's 7 bucks. If you make a $100K it's $30. If you make 500K it's $100 and if you make a million it's $1000. You make over 100K, do you eat at Burger King?
Don't back down Phil. We need our heroes to tell it like it is. Full Story from Yahoo News