Who misrepresented Obama's tax plan? Anyone? Anyone? Ben Stein

››› ››› JEREMY HOLDEN

On Fox & Friends, Ben Stein misrepresented Sen. Barack Obama's tax plan to raise the capital gains tax rate on the wealthiest earners, stating: "[P]eople that have incomes in the five digits ... that's crazy to increase their capital gains tax." In fact, Obama has said he would not raise the capital gains tax on individuals with income of less than $250,000.

During the June 11 edition of Fox News' Fox & Friends, conservative commentator and actor Ben Stein misrepresented Sen. Barack Obama's tax plan to raise the capital gains tax rate on the wealthiest earners. Stein stated, "I'm very worried about increasing the capital gains tax, unless you want to just increase it on people that are terribly wealthy," whom he defined as "people that have an income of $5 million a year or more." He added, "But people that have incomes in the hundreds and the low hundreds of thousands, people that have incomes in the five digits, that's way -- that's crazy to increase their capital gains tax." But Stein's suggestion that Obama plans to raise the capital gains rate on "people that have incomes in the five digits" is false. In fact, Obama has said he would not raise the capital gains tax on individuals with income of less than $250,000. In a June 9 interview with CNBC's John Harwood, Obama said, "[K]eep in mind on all of these proposals, what I have said is, let's make sure that we define the well-off so that we're not hitting the middle class. I generally define well-off as people who are making $250,000 a year or more, and that means, for example, if we raise the capital gains tax, I would exempt people who are essentially small investors, and really capture the -- those who have done very, very well over the last two decades."

Furthermore, Stein asserted that Obama's tax plan would put Americans' retirement plans at risk: "It means a huge amount in terms of retirement planning, because if you are retiring, you're going to depend a lot on capital gains from your investments to fund your retirement. If that's going to be taxed away, your retirement is in severe jeopardy." However, Stein's statement ignores the fact that distributions from 401(k) and IRA accounts are taxed as regular income, not as capital gains.

Later in the discussion, co-host Gretchen Carlson asserted, "[P]art of the Barack Obama plan, I think, is to increase the tax when you try to sell your home, as well, which could affect, well, everyone, but retirees as well."

In fact, Carlson's suggestion that everyone who sells a home would be affected by raising the capital gains tax is false. The law exempts profits from the sale of a primary residence up to $250,000 for single owners and $500,000 for married owners. Only home-sales profits exceeding those values would be affected by Obama's proposal.

From the June 11 edition of Fox News' Fox & Friends:

STEVE DOOCY (co-host): Now, let me ask you about this. I saw on one of the debates Barack Obama was asked -- I think by Charlie Gibson at ABC: "What are you going to do about capital gains?" Right now it is at 15 percent --

STEIN: Right.

DOOCY: -- which is -- a lot of people say that's about where it should be. Now, he's suggesting he would jack it up to maybe 25 or 30 percent, perhaps doubling it.

STEIN: Yeah.

DOOCY: What does that mean to us?

STEIN: It means a huge amount in terms of retirement planning, because if you are retiring, you're going to depend a lot on capital gains from your investments to fund your retirement.

DOOCY: Mm-hmm.

STEIN: If that's going to be taxed away, your retirement is in severe jeopardy. So I'm very worried about increasing the capital gains tax, unless you want to just increase it on people that are terribly wealthy. I have no problem with increasing the tax on people who have an income of $5 million a year or more.

DOOCY: Neither do we.

STEIN: Like you two, I would say that would be your --

CARLSON: Yeah, right.

STEIN: I'm guessing that's your income. But people who have incomes in the hundreds and the low hundreds of thousands, people that have incomes in the five digits, that's way -- that's crazy to increase their capital gains tax. People are in a retirement crisis.

DOOCY: Yeah.

STEIN: A major retirement crisis. We have something like 30 million baby boomers who have no preparation for retirement at all. We've got to get them investing. We can't tax away their gains, otherwise it's just going to be a catastrophe. I could see the retirement crisis being the biggest crisis in this country since the Great Depression.

DOOCY: Oh, man.

CARLSON: Really? Well, and also part of the Barack Obama plan, I think, is to increase the tax when you try to sell your home, as well --

STEIN: Yes.

CARLSON: -- which could affect, well, everyone, but retirees as well.

STEIN: It's going to affect everybody. I don't think he's thought this through. I think he's a good man, but he hasn't thought this through. And I think he's getting advice from people who are more interested in envy and in soaking the rich than in helping the middle class.

From the June 10 edition of CNBC's Your Money, Your Vote:

OBAMA: So the general principle of raising taxes on higher-income Americans like myself, and providing relief to those who haven't benefited as much from this new global economy, I think, is a sound one. And keep in mind on all of these proposals, what I have said is, let's make sure that we define the well-off so that we're not hitting the middle class. I generally define well-off as people who are making $250,000 a year or more, and that means, for example, if we raise the capital gains tax, I would exempt people who are essentially small investors, and really capture the -- those who have done very, very well over the last two decades.

Posted In
Economy, Taxes
Network/Outlet
Fox News Channel
Person
Ben Stein, Steve Doocy, Gretchen Carlson
Show/Publication
FOX & Friends
Stories/Interests
Barack Obama, 2008 Elections
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