Bill Kristol may have put a finger on a way to assuage Republican heartburn about raising taxes on the wealthy as part of a fiscal cliff-averting deal with President Obama. He asks, incredulously: Is the GOP really going to “fall on its sword to defend a bunch of millionaires, half of whom voted Democratic and half of whom live in Hollywood and are hostile to Republican principles?”
Victor Davis Hanson seconds the motion: “Given that the wealthiest counties in the U.S. are mostly blue-voting elites who caricature Republicans for not voting for higher taxes, maybe Republicans should focus on ensuring no new taxes on the $80,000 to $250,000 upper-middle-class households and let the tax chips fall where they may on the mostly Obama households above that.”
But notice the moving goalposts. Kristol asserted that half of millionaires vote Democratic — a claim I doubt (for reasons outlined below), but which, on its face, isn’t completely insane. Hanson, however, parachutes into What Are You Smoking-stan with the idea that households making more than $250,000 are “mostly Obama households.” This is just not true. And it’s not even close.
Start with the Center for Responsive Politics’ revealing table on the top donors to President Obama and Mitt Romney. Individuals who donated to Obama were most often affiliated with the University of California, Microsoft Corp., Google Corp., the U.S. government, and Harvard University. Microsoft and Google undoubtedly boast their share of millionaires. But employees of universities and the federal government are far more likely to fall into Hanson’s $80,000-250,000 category.
Meanwhile, Mitt Romney’s top donors hailed from — call the roll — Goldman Sachs, Bank of America, Morgan Stanley, JP Morgan Chase and Co., and Credit Suisse Group.
The Fiscal Times reported (citing data from, again, the Center for Responsive Politics):
Overall, the securities and investment industries have given more than $67 million to Republican campaigns and less than $40 million to Democrats. That excludes contributions to Super PACs, where the balance of Wall Street donations has been even more skewed toward Romney and conservative groups. Donors in the securities and investment industries have given nearly $51 million to outside groups this election cycle, with nearly $44 million of that going to conservative groups…
Forget the financial services industry. There are more data points that explode Hanson’s fiction. Obama raised more from individual donations of less than $200, while Romney raised more from donations of more than $2,000 — not dispositive (perhaps many ordinary Republican donors are, like the poor widow in the Gospel of Mark, generous to a fault) but highly suggestive. Derek Thompson points to more data that suggests it’s Democrats, not Republicans, who are mostly likely to be found in Hanson’s upper-middle-class sweet spot: after households reach $100,000, they are more likely to vote Republican.
Columbia University statistician and political scientist Andrew Gelman, too, has demonstrated empirically that there are more rich Republicans than Democrats. In May, Adam Bonica of Stanford University looked at $460 million in political contributions from 377 of the Forbes list of the 400 richest Americans, and here’s what he found:
To be sure, there is an undercurrent to the Kristol-Hanson (and before them Andrew Ferguson) argument that we need to acknowledge — namely that the rich are far more likely than not to be socially liberal. (I think these are the “Republican principles” that Kristol refers to.) It’s a point I’d happily concede. But we must not consequently fool ourselves into believing that the rich and super-rich are all, contrary to popular myth, aligned with the likes of George Soros.
There is a kernel of wisdom in Kristol-Hanson meme: it won’t “kill the country” if we raise taxes on the wealthy in the amount that Obama is asking for. And $700 or $800 billion over 10 years really is just a fig leaf. We’d still face a long-term deficit problem, and we’d still need to reform our entitlement structure. Indeed, this relatively piddling amount of revenue is the reason why liberals were apoplectic last year when the details of the grand bargain were revealed.
I’m not going to quibble, however. If “Go ahead and tax the rich — they’re Democrats!” eventually becomes the sweetener that the Republican establishment needs to sell a deal to itself and to the Tea Party, and thereby save the country from a needless economic crisis, I say run with it.