Dem senator: Buffett Rule ‘isn’t going to balance the budget’

Sen. Chris Coons (D-Del.) on Wednesday acknowledged GOP criticisms that the Obama administration’s Buffett Rule “isn’t going to balance the budget,” but he argued that the proposal was important as a matter of “values” and “fairness.”

“This is an issue about fairness,” Coons said on MSNBC. “It isn’t going to balance the budget, but it is important for values and for showing some fairness.”

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On Wednesday, Republican National Committee Chairman Reince Priebus wrote an editorial blasting the Buffett Rule as a gimmick, including the GOP argument that the tax reform measure does little to address the nation's budget crunch.

“The Buffett Rule won’t balance the budget,” Priebus wrote. “It won’t prevent a debt crisis. It won’t help the economy. It won’t get you a job. But contrary to Obama’s rhetoric, it was never meant to. For Barack Obama, the Buffett Tax (it’s a tax, plain and simple) has one goal: to divide and distract America.”

Coons spokesman Ian Koski told The Hill that Democrats have never claimed that the Buffett Rule was designed to solve the budget issue, but is merely one fair way to increase revenues towards that end.

While Coons admitted that the increased revenue generated by taxing the wealthy won’t solve the nation’s deficit woes, he argued that it was a necessary step in repairing trust in the free markets at a time when wealth disparity between America’s top earners and the middle class has increased.

“At the end of the day, the Buffett Rule is about fairness. It’s about fairness in our tax system,” Coons said. “The core issue here is about individual income tax rates, and how it’s possible for the standard bearer of the Republican Party — now apparently Gov. Romney — to pay who knows what, because we don’t have his tax returns for the last couple of years, but through a variety of tax havens in offshore accounts, the Cayman Islands, other islands around the world to pay single digits, 10 percent, 15 percent, when taxi drivers, postal workers, and cops are paying 30 percent.” 

GOP presidential candidate Mitt Romney released his 2010 and 2011 tax returns, which show he paid an effective tax rate of about 14 percent. 

Democrats have used the Buffett Rule, named after billionaire investor Warren Buffett, and which would force the wealthiest to pay at least as high a tax rate as the middle class, to hammer Romney on taxes.

But Republicans argue that ensuring that Americans earning $1 million or more pay at least 30 percent in taxes would harm small businesses and reduce investments in the economy.

Coons called this a “reasonable criticism” of the Buffett Rule, but he said there are ways around it.

"I would agree that one of the issues that was raised is ... how do we make sure that small businesses that are a significant number of filers under the corporate section that would pay a 30 percent rate, have some carve-out where if they’re investing, if they’re creating jobs, they don’t face a doubling of their tax rates,” Coons said. “I do think that’s a reasonable criticism of the Buffett Rule if [is were] just applied across the board.”

President Obama made his case for Buffett Rule at length during campaign stops in Florida on Tuesday and has made it a centerpiece of his election-year push for economic equality.

This story was updated at 12:32 p.m.