How many in Chicago Obama's proposed "Buffett Rule" could affect | Bleader

How many in Chicago Obama's proposed "Buffett Rule" could affect

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On Monday President Obama unveiled his new deficit reduction plan, which includes the Buffett Rule, a new minimum tax rate for people earning above $1 million, named after the Democrat-friendly gazillionaire. Republicans pounced on the move, dubbing it “class warfare.”

As Jared Bernstein, a former White House economist, points out on his blog, if this is warfare one side clearly has a bigger stockpile of ammunition:

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  • Jared Bernstein's On The Economy blog

So: if the Obama plan were to become law (which, by the way, it almost surely won't), how would it hit Chicago?

Each year, the consulting group Capgemini releases its Metro Wealth Index, which lists, by city, the “high net worth individuals”—an Orwellian term for people with assets over a cool mil. According to the group’s latest figures, Chicagoland has 212,300 of them, behind New York and LA in net millionaires. (It's true that net assets are different from income. And on its surface, the Obama plan only deals with income, which means some of these high netters wouldn't see a hike. But if you get into the weeds, the plan may include measures of wealth like net assets, so it's probably fair for us to lump these Chicagoans into the mix.)

Three years ago, the metro area lost more than 16 percent of its millionaires. Then, a year later, it gained nearly all of them back, perhaps thanks to the Groupon generation of exceedingly wealthy millennials. Last year, Chicago picked up another 7.1 percent.

Chicago’s superwealthy, like everyone else in the state, have already seen their tax rates climb up this year. Back in January, Governor Quinn hiked the personal income rate by 67 percent. The figure seems astounding until you dig in a bit: the increase bumped the rate from 3 to 5 percent. Prior to the hike, Illinois had the lowest personal income rate in the country of those states that levy the tax. (Nine do not.)

One of our region's more colorful characters, Representative Joe Walsh, already came out strongly against the plan when Buffett first suggested it. Walsh, who, it turns out, is definitely not a millionaire, said it "doesn't make sense to raise taxes on America's job creators." Meaning, America's millionaires.

In Chicagoland, less than 3 percent of the population qualify as these so-called "job creators." Where Walsh goes to work, it’s just about half.

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