Arianna's not paying her fair share


iconThe LA Times, who has made it no secret that they are firmly against the California recall election, is trying to make much ado about Arianna Huffington's lack of income. Check out the first passage from this well aimed "news" report.

TV commentator and author Arianna Huffington, who launched her campaign for governor with criticism of "fat cats" who fail to shoulder a fair share of taxes, paid no individual state income tax and just $771 in federal taxes during the last two years, her tax returns show.
There's that term fair share. Soak those of us that have won life's lottery, and then criticize us for not paying enough. Lovely.

Although with Huffington, that isn't the case, because she has so many expenses to chip away at her income. The Times sounds almost like they are accusing her of tax evasion. Then they follow it up with this non sequitur.

Huffington, who released her tax returns for the last two years to The Times, lives in an 8,000-square-foot home in Brentwood above Sunset Boulevard that is valued at about $7 million.
What does the size and value of her house have to do with her federal income tax return? Nothing. If anything, the fact that she lives on a large estate shows that she probably pays a small fortune in property tax, which she would naturally deduct from her revenues.

Since Arianna runs her own business, and it has been operating at a loss, she's able to take recoup some of those losses by reducing her income tax liability. (More power to her.) What a shock that a California business would operate at a loss, these days. Of course, when she claims her expenses and losses against her revenue, she comes up with very little income, and very little income tax, which is the way the tax laws work. They teach that in Accounting 101, and it is something that every American business owner does.

Of course, the core of the entire issue is the LA Times belief that it is your American patriotic duty to pay as much income tax as you possibly can, to ensure that you are paying your fair share. Note how they try to make her sound guilty by emphasizing that she "denies taking advantage of loopholes and unfair deductions." What the hell is an "unfair deduction"? Tax law is written in black and white, and your deductions are either legal or illegal. The Times tries to make it out to be a question of morality by calling it "unfair", rather than legality. If her deductions are legal and the Times considers them "unfair", than it must be the law that is inherently "unfair", and not Huffington. By talking about "loopholes" they try to make her sound like she's violating the spirit of the law, by not paying as much tax as possible.

Note also how they also play on people's greed and envy, by noting how nice of a home she lives in, and eluding to her net worth, none of which has to do with income tax. The reason of course, is that we don't have a wealth tax; we have an income tax. We will likely never have a wealth tax, mainly because most congressmen have an abundance of wealth, yet earn relatively little income. (Hell, even businessmen like Bill Gates typically only pay themselves about $100,000 a year.) Senator's like John Felafel Kerry, who is worth hundreds of millions of dollars and our nation's wealthiest Senator, aren't about to propose a 'wealth tax'. (Although you may hear him talk about how bad income tax cuts are.)

Of course, the effect of an income tax is that it serves to keep people from becoming wealthy, and stifles hard work and economic reward. For people that are already extremely wealthy, like Vietnam Veteran Kerry, it's irrelevant, because comparatively, they pay very little income tax.



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I hold no brief for Huffington, who strikes me as being a few quarts below the dipstick. However, isn't it lovely how those who absolutely revile capitalism and this country found nothing stronger to play against her than the envy card?

That was their first play, not their last. Which means it's uppermost in their minds. Which means, if they ever again achieve serious power, keep one hand on your wallet and the other on your gun.

Posted by: Francis W. Porretto at August 15, 2003 1:34 PM

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