When President Obama released his FY2013 budget, it was more of the same—trillion-dollar deficits, huge spending, and tax hikes on high-earners. The president wants to raise taxes substantially on households earning more than $250,000. It’s all about fairness he claims, even though effective tax rates on high-earners are already double the rates on middle-earners.
More importantly, supporters of President Obama’s soak-the-rich tax strategy don’t seem to be concerned about the negative consequences for the economy. They seem to have convinced themselves that the Top 1 Percent is dominated by shady Wall Street speculators and other supposed economic leeches.
The reality is that the Top 1 Percent is mainly populated by highly productive people who are crucial to America’s economy. Let’s look at one of the largest subgroups within the Top 1 Percent—doctors and surgeons. Bureau of Labor Statistics data show that there are about 700,000 doctors and surgeons in the United States. The Washington Post on Sunday provides median 2011 doctor salaries from a medical organization survey. Salaries range from $208,658 for family doctors to $501,808 for orthopedic surgeons.
The marketplace has rewarded doctors generously, but everyone knows that makes sense because doctors have extensive education and often work long hours in stressful environments. In its occupational overview of physicians and surgeons, the Bureau of Labor Statistics notes that these professionals need “4 years of undergraduate school, 4 years of medical school, and 3 to 8 years of internship and residency,” which are requirements “among the most demanding of any occupation.”
The BLS also notes that “many physicians and surgeons work long, irregular hours. In 2008, 43 percent of all physicians and surgeons worked 50 or more hours a week.” Doctors often need to make emergency visits to hospitals and nursing homes, and they need to spend many additional hours reading to keep up with medical advances.
So doctors study hard, work hard, and serve a crucial role in society. And what does President Obama want to do to them? He wants to punish them with higher taxes.
Chris Edwards is the director of tax policy studies at the Cato Institute, and editor of www.DownsizingGovernment.org. Before joining Cato, Edwards was a senior economist on the congressional Joint Economic Committee, a manager with PricewaterhouseCoopers, and an economist with the Tax Foundation.
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