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Veteran Advisor

Same Old Game.

President Obama's new plan to cut taxes on all but those most likely to create jobs is little more than an exercise in class warfare to divide Americans and win votes — not to get the economy growing again.

Much was made of Obama's "compromise" on taxes, including his plan to keep lower rates on the 98% of Americans who earn less than $250,000, and spend $180 billion or more to cut some business taxes and invest in more infrastructure repair.

The president's supporters say this is a good plan — giving Republicans the tax cuts they want while letting average Americans keep their current tax rates. Only the "rich" get hit.

This plan is actually quite cynical, as even the New York Times tacitly admits, saying Obama "intends to cast the issue as a choice between supporting the middle class or giving breaks to the wealthy." In short, it's not really about jobs at all. It's about politics.

Obama, though himself wealthy, seems to truly hate the private-sector rich — believing the neo-Marxist pap that as a "class" they create nothing, but rather exploit the rest of us.

When he told Joe the Plumber during the 2008 campaign that he wanted to "spread the wealth," he was at least telling the truth.

In fact, the wealthy are the nation's creators, innovators and job makers. The small businesses they run account for more than four of every five new jobs. Obama's tax hikes target them — and you.

As economists Kevin Hassett and Alan Viard recently noted, "Fully 48% of the net income of sole proprietorships, partnerships and S corporations reported on tax returns went to households with incomes above $200,000 in 2007."

A recent National Federation of Independent Business survey found that 50% of the small-business owners who employ 20 to 249 workers fall in the top two income brackets. They're the "rich."

So half of all small-business profits — maybe more — will be hit by Obama's tax hikes. And guess what? They'll respond predictably by not expanding their businesses or doing more hiring. If Obama's plan is passed, expect no meaningful job growth for years.

For two years, we've heard repeated verbal assaults leveled at successful people to make the rest of us resent their success — like the canard that the rich don't pay their "fair share" of taxes.

Well, as the National Taxpayers Union recently reported, the richest 1% of Americans earn 23% of all income and pay almost twice that — 40% — toward income taxes. Meantime, the bottom 50% take home 12% of the income and pay only 2.9% of the taxes.

Fair? Since 2002, the year before President Bush's 2003 across-the-board tax cut went into effect, the share of taxes paid by the wealthy has risen every year. As for Democrats' claim that the tax cuts "benefited only the wealthy," 7 million new U.S. jobs were created from 2003 to 2008. How's that stack up to Obama's record of 4 million lost and counting?

Instead of emulating past success, Obama continues to push policies that scapegoat the rich while using "stimulus" spending to enlarge government, enrich unions and subsidize favored industries.

To their credit, Republicans have countered with a far better plan — one that freezes tax rates at the Bush levels and rolls back spending to the pre-stimulus levels of 2008. This would have a truly stimulative effect on the economy. It would be even better if the tax changes were made permanent and future spending were cut.

Until something is done to convince businesses that Washington is capable of fiscal sanity, few companies will willingly commit huge amounts of capital to new investments and jobs.

Like the rest of us, they want tax and regulatory relief, entitlement reform and smaller government. Until they get it, they'll sit on the sidelines waiting for the craziness to end.

22 Replies
Senior Advisor

Re: Same Old Game.

Don't you think the "wealthy" have done a lot of job eliminatiuon as well? MUlti Million Dollar CEO's laying off workers by the thousands. I dare say they eliminate more jobs than they create and have been doing so year after year. It's the small businesses that are creating jobs. 

 

Many of the high earners are in the financial markets and much of their ill gotten gain is buy fraudulkant activity and you want to make sure they aren't troubled with a few pennies more in taxes.

 

BTW most people that invest in stocks never create a job. They merely invest and speculate in the market. What the heck does it create for you to trade stocks with other investors?  Many corps aren't creating jobs. IT's the companies that have customers that are hiring. Not those with a tax cut. You guys been selling that crappola for nigh unto 30 years now and it's about time the trend got reversed.

Senior Contributor

Re: Same Old Game.

Without the Bush tax cuts the economy would have been in the sheeter 2 years sooner. And, If Obama  takes them away,  watch it all come down again. The Bush war financed with tax payer dollars 'off budget' started the house of cards to fall. He should have issued war bonds to finance it, just as Obama should issue them to finance his little war in Afghanistan. These incursions financed with taxpayer funds 'off budget' eventually end up on the budget with red ink.

Veteran Advisor

Re: Same Old Game.

"As economists Kevin Hassett and Alan Viard recently noted, "Fully 48% of the net income of sole proprietorships, partnerships and S corporations reported on tax returns went to households with incomes above $200,000 in 2007."

 

And that amounts to about 2.5% of all taxpayers.  Plus, they get the same tax cuts as before on all UP TO $200K!!  However, that isn't even the biggest problem with your hysteria.  That big problem is that a vast majority of those making over $250K or $200K jointly, NEVER use the money to create anything much less a job.  They either save it, invest in stocks and bonds or buy bigger toys.  Well, to the devil with them.  Let them pay down the national debt a little

Senior Contributor

Re: Same Old Game.

" That big problem is that a vast majority of those making over $250K or $200K jointly, NEVER use the money to create anything much less a job.  They either save it, invest in stocks and bonds or buy bigger toys.  Well, to the devil with them.  Let them pay down the national debt a little"

Pathetic thinking from you Schnu. Obviously you have never scratched a living from your own business without having someone else issue you a paycheck. Sadly, quite possibly a majority of voters agree with you. You don't think that businessman making $250k+ doesn't pay more tax than you? He doesn't create more economic wealth than you? He should be penalized for his success? Just shows how the public education system has totally failed.  You kill the wealth in this country you will kill any reason for anyone to venture out on their own. You kill risk taking. Just work for the man, draw a paycheck and pay union dues, and look forward to your retirement. I guess it might be OK, since it paid off for you.

Veteran Advisor

Re: Yup!


@4wd wrote:

" That big problem is that a vast majority of those making over $250K or $200K jointly, NEVER use the money to create anything much less a job.  They either save it, invest in stocks and bonds or buy bigger toys.  Well, to the devil with them.  Let them pay down the national debt a little"

Pathetic thinking from you Schnu. Obviously you have never scratched a living from your own business without having someone else issue you a paycheck. Sadly, quite possibly a majority of voters agree with you. You don't think that businessman making $250k+ doesn't pay more tax than you? He doesn't create more economic wealth than you? He should be penalized for his success? Just shows how the public education system has totally failed.  You kill the wealth in this country you will kill any reason for anyone to venture out on their own. You kill risk taking. Just work for the man, draw a paycheck and pay union dues, and look forward to your retirement. I guess it might be OK, since it paid off for you.


Yup, Brian has been "institutionalized".  To jump when the bell rings or reveille blows. 

When those "rich guys" could keep some of their own money, they bought pleasure horses that ate up lots of hay that I sold to make a living.  Now that they are gone, so are the hay sales, and our fragile rolling land has to be rented out to put in row crops.

Also, butt-heads like tom harkin (retching) voted to outlaw horse slaughter in this country, so no one can even find a way to unload an aged horse without it costing an arm and a leg.

Pretty soon, all of the producers in this country will start looking for a new country to live in, that they can be allowed to be productive in, without losing all of their efforts in the form of theft by government.

Senior Contributor

Re: Yup!

I've been around some high rollers around here who I am sure make more than the $250k and they certainly do pay  a ton of taxes. Maybe not so much the income tax, but gasoline tax, real estate taxes, sales taxes, etc, all fed and state will shock you how much they contribute. Ever been one of their homes? How about count the cars in their garage? Even the flying they do, hotel taxes they pay, Jeese, you can't possibly think they aren't needed and appreciated in this economy? I'd venture to say more of them would be better than more of you.

Senior Contributor

Re: Same Old Game.

"...............NEVER use the money to create anything much less a job.  They either save it, invest in stocks and bonds or buy bigger toys."

 

I'd like to say "I can't believe what I'm hearing".....but I've been around these boards, with the likes of 'bart and Don, long enough to know there are people who just don't seem to understand what stocks in a company are all about.

Veteran Advisor

Re: Same Old Game.

You could drop dead tomorrow, the crop would get harvested this fall, planted next spring and not one dime of GDP would be lost.

 

Actually, given the way GDP is calculated it might go up due to the increased revenue at the crematorium.

Veteran Advisor

Re: Same Old Game.

Wars weren't financed with taxpayer dollars, they were financed by borrowing from the Chinese.