Fareed Zakaria Shocker: Buffett Rule Is 'Bad Politics' for Obama

A truly shocking thing happened on CNN's Fareed Zakaria GPS Sunday.

The perilously liberal host - with journalistically corrupt ties to the current White House - came out against the millionaires' tax known as the Buffett Rule calling it "bad politics in the long run for Obama" (video follows with transcript and commentary):

FAREED ZAKARIA: After months of meandering, it seems President Barack Obama's re-election campaign has settled on a theme. The problem is - it's the wrong one.

The "Buffett Rule" tax on millionaires has become Obama's bumper sticker. The proposal is reasonable - but it does not deserve the attention Obama is showering on it. It raises a trivial sum of money - $47 billion over the next 10 years - during which period the federal government will spend $45 trillion. It adds one more layer to a tax code that is already the most complex and corrupt in the industrialized world.

The focus on the Buffett Rule is also bad politics in the long run for Obama. While polls might momentarily show that it works, Americans are generally aspirational, not envious. Over the years voters tend to support a government that focuses on creating opportunity rather than one that tries to reduce inequality. Bill Clinton and Tony Blair's great feat was to position themselves as pro-market, pro-growth, pro-opportunity progressives. Obama should not fritter away that asset.

Pretty shocking, especially as Zakaria came out in support of the Buffett Rule less than two weeks ago. I guess like his hero Barack Obama, this CNN anchor doesn't have a problem with flip-flopping.

If only he had quit while he was ahead:

ZAKARIA: Ironically, Obama has been pivoting at the very moment events in the real world are providing him with the perfect campaign issue. We are four years into the financial crisis. In the United States, the government acted speedily and massively to stimulate the economy, using monetary and fiscal measures. In Europe, by contrast, governments quickly turned toward austerity programs, cutting spending across the board to reduce budget deficits.

Well, the results are in: The U.S. economy is expected to grow 2 to 3 percent this year. The euro zone is expected to contract by 0.3 percent this year; Spain and Britain have officially entered a double-dip recession, the first time major economies have done so in 40 years. IMF projections show that even Germany's average growth rate over the next five years will be only 40 percent of America's.

President Obama started the year speaking of "an economy built to last." He should return to this theme and frame this campaign as a choice between investments on the one hand and budget cuts on the other. And he has substance behind his rhetoric.

Obama has proposed several important investment initiatives: a $476 billion infrastructure plan; a 5% hike in research and development spending; a job-training program to help dislocated workers; incentives for manufacturing; funds to expand the pool of college graduates and to increase science and engineering students. So, he should ask Americans to choose between these investments to create long-term growth versus massive budget cuts.

In the midst of the economic crisis, Warren Buffet said that his strategy was to invest in America. That's the Buffett Rule Obama should follow.


Zakaria has now made this same comparison between America and Europe for the second week in a row, and both times he left out a key element: Great Britain under Prime Minister David Cameron didn't just cut its budget. It also raised taxes.

Even Al Arabiya is willing to report that: "Britain’s Conservative-Liberal Democrat coalition has implemented huge cuts to public spending and raised taxes in a bid to slash a record deficit inherited from the previous Labour government in 2010."

Heck, so's the perilously liberal New York Times: "After Mr. Cameron’s narrow victory, he moved briskly to reshape the government, pushing through an austerity program of sharp spending cuts despite mass protests. The program reduced costs in government departments by almost 20 percent, sharply curtailed welfare benefits and eliminated hundreds of thousands of public sector jobs while raising taxes."

But as the British Telegraph reported in February, this hike resulted in far less tax revenues than was expected.

Any economist could have told Cameron that cutting spending AND raising taxes in a recession is a recipe for disaster. It's like a business owner raising prices while he cuts his marketing budget and being surprised when sales drop.

Even the dangerously liberal New York Times columnist Paul Krugman in 2008 admitted this was a key failure of Franklin Delano Roosevelt during the Depression.

Yet Zakaria didn't say a word about Britain raising taxes Sunday, instead blaming England's double-dip exclusively on spending cuts.

That wasn't very honest of him, was it?

Noel Sheppard
Noel Sheppard
Noel Sheppard, Associate Editor of NewsBusters, passed away in March of 2014.