Nicholas Kristof's "Taxes and Billionaires": Beyond Kristof's Ken

In the past, Nicholas Kristof has written some incredibly inane material, demonstrating a level of ignorance that does not behoove a national newspaper. One of the stupidest columns he has ever written was "New Alarm Bells About Chemicals and Cancer" (http://www.nytimes.com/2010/05/06/opinion/06kristof.html), in which he declared:

"The President’s Cancer Panel is the Mount Everest of the medical mainstream, so it is astonishing to learn that it is poised to join ranks with the organic food movement and declare: chemicals threaten our bodies.

. . . .

Avoid meats that are cooked well-done."

Apparently, Kristof was unaware that our bodies consist of chemicals and that well-done, as opposed to potentially carcinogenic charred or burned, meat prevents the ingestion of dangerous bacteria. In short, there are certain areas where Kristof should never venture.

Well, if you thought "New Alarm Bells About Chemicals and Cancer" was dumb, have a look at Kristof's latest New York Times op-ed entitled "Taxes and Billionaires" (http://www.nytimes.com/2011/07/07/opinion/07kristof.html?_r=1&hp). In his new essay, Kristof goes to bat for President Obama and blames U.S. economic woes on the Republicans, who allegedly are looking out for the best interests of the richest 1 percent of Americans, who include - not mentioned by Nicholas - multi-millionairess and House Minority Leader, Nancy Pelosi, Democrat, California, worth at least $35 million in calendar 2010. Kristof focuses his readers' attention on the carried interest tax loophole:

"Tycoons have bet for years that the public is too stupid or distracted to note that in many cases they’re paying just a 15 percent tax rate.

What’s at stake is the 'carried interest' loophole, and President Obama is pushing to close it. The White House estimates that this would raise $20 billion over a decade. But Congressional Republicans walked out of budget talks rather than discuss raising revenues from measures such as this one.

. . . .

This carried interest loophole benefits managers of financial partnerships such as hedge funds, private equity funds, venture capital funds and real estate funds — who are among the highest-paid people in the world. John Paulson, a hedge fund manager in New York City, made $4.9 billion last year, top of the chart for hedge fund managers, according to AR Magazine, which follows hedge funds. That’s equivalent to the average per capita income of 184,000 Americans, according to my back-of-envelope calculations based on Census Bureau figures."

Don't get me wrong: I favor closing this loophole, but this is not what is going to save the U.S. economy or balance the budget.

Kristof tells us that by closing the carried interest loophole, $20 billion over a decade will be saved. By the same token, perhaps we can say that closing this loophole will save $200 billion over the next century. On the other hand, it could also be stated that closing the loophole will save $2 billion next year. Annual savings of $2 billion? Let's place that in perspective:

• The estimated cost to the U.S. of what is now Obama's senseless war in Afghanistan will reach a record $120 billion in 2011. Why is Kristof not highlighting this fact?

• This year’s budget deficit is projected to reach a record $1.5 trillion. Compare that with a savings of $2 billion.

Now let's look at Kristof's other gem, i.e. $4.9 billion is "equivalent to the average per capita income of 184,000 Americans," according to his "back-of-envelope calculations." Excuse me, but this is unintelligible. Does he mean that $4.9 billion is equal to the average annual per capita income of 184,000 Americans? Or does he mean the combined total annual average per capita income of 184,000 Americans? To which 184,000 Americans is he referring? Sure, I know, he probably means the average per capita annual American income, but he doesn't say any of this.

Perhaps Kristof would be best off not "calculating," and certainly not on the back of envelopes.

However, more to the point, why did Kristof attempt this disastrous economic analysis? With the U.S. economy tanking and little hope in sight, the only way Obama can be reelected is by blaming others for his failure and seeking to ignite class warfare by attacking the rich. Again, I am in favor of eliminating all inequitable loopholes, including those sponsored by Democrats, so as to balance the budget, but if Obama is relying on Kristof's advocacy to be reelected, he's in big trouble.