A recent letter about two Americas was very informative, but the writer conveniently forgot to mention that Mitt Romney's income was dividend-related and taxed at the capital gains rate of 15 percent.
His original earnings were from initial investments in stocks, businesses, etc., and were taxed at a rate of 35 percent to 40 percent. That brings his true tax rate to approximately 50 percent. If the middle manager takes his earnings after paying federal taxes and invests in dividend-paying stocks, he would pay 15 percent on the dividend distribution.
The other example which has been mentioned many times by President Barack Obama is Warren Buffett's secretary. She makes an estimated $500,000 and pays a higher tax rate than Buffett.
They forget to mention that Buffett's money is in trusts and after initially paying 35 percent to 40 percent in federal taxes, he pays taxes at the capital gains rate of 15 percent, whereas his secretary would pay a normal federal income tax rate.
The 15 percent rate would apply to anyone willing to risk their capital making investments.
Obama wants to raise the capital gains tax rate to 30 percent, which would result in fewer individuals investing capital in stocks and businesses and real estate. This would be devastating to our economy.
The letter writer's recommendation is that Congress should redistribute wealth, which is contrary to every principle our country was founded on as we are a capitalistic society. These ideas belong in a socialist country, and I hope they are never instituted in our country.