One of the right wing’s favorite pieces of misinformation regarding President Obama’s budget is that the tax increases he plans to enact on the top two income tax brackets will destroy small businesses. The New York Times’ Caucus blog noted that Sen. Kent Conrad (D-ND) “moved aggressively on Wednesday to counter Republican complaints” in a very original manner:
To prove the Democrats’ point – that only a minute portion of actual small business owners would face a tax increase under the budget plan – Mr. Conrad displayed a poster on the Senate floor featuring a large photograph of former Vice President Dick Cheney. Mr. Cheney, who has been vocally critical of the Obama administration, would qualify as a small business owner under the Republicans’ definition, Mr. Conrad said, even though only about $180,000 of Mr. Cheney’s more than $3 million in income in 2007 came from small business interests.
In reality, only 1.9 percent of taxpayers with small business income file in the top two income brackets, and many of those individuals don’t have employees or earn their income through passive investments. The Center on Budget and Policy Priorities has pointed out that “the $84 of income President Bush received in 2001 from a passive investment in an oil and gas company made him a ‘small-business owner’.”