It’s a measure of how low the budget debate in Washington has sunk that President Obama’s advocacy of grossly inadequate revenue increases now stands as an outpost of responsibility.
Income-tax rate reductions that Congress enacted in 2001, 2003 and 2010 are scheduled to expire at the end of this year. Mr. Obama has said he’d like to extend these lower rates into 2013, except for the ones that apply to individuals earning more than $200,000 and couples earning more than $250,000. For those taxpayers, rates would return to 1990s levels.
We call this grossly inadequate because — as we’ve been saying since Mr. Obama irresponsibly promised during his first campaign that he would never raise taxes on the middle class — it’s impossible to tackle the federal debt by taxing only the wealthy. As the cost of retirement and health care for an aging population rises, the middle class is going to have to pay more, and federal benefits are going to have to be adjusted.
But Republicans want to extend all the rate reductions, regardless of the deficit, and some of the president’s fellow Democrats, spooked by GOP anti-tax rhetoric or persuaded by their wealthier donors, are equivocating. Some, including House Minority Leader Nancy Pelosi, have suggested redefining “well-off” to include every family earning less than $1 million per year, and extending the rate reduction for everyone below that level. This is a recipe for fiscal disaster — a disaster that will hurt society’s most vulnerable, because programs they depend on will be the first ones cut as federal borrowing costs rise.
The Dec. 31 deadline is setting up a tiresomely familiar game of political chicken. Everyone, including Federal Reserve Chairman Ben S. Bernanke, agrees that letting all the tax cuts expire at once would land a powerful punch on a weak economy, especially since a package of spending cuts worth $1.2 trillion over the next 10 years would take effect at the same time.
The intelligent response would be to agree on long-term revenue increases and spending cuts while softening the short-term blow. It would be dangerous to national security, as Defense Secretary Leon Panetta has argued (unsupported, thus far, by his commander in chief), to impose across-the-board budget reductions on the Pentagon.
Allowing those and all the other scheduled spending cuts and tax hikes could shrink the economy by about 3 percent in the first half of 2013, at the cost of 1 million to 2 million jobs, the Congressional Budget Office estimated months ago. Given the deterioration in the economy since, that estimate might be optimistic.
If the only way to achieve tax reform with a reasonable increase in revenue is to reset everyone’s rates at Clinton-era levels and then argue about which to reduce, that would be preferable to continuing on the road to catastrophe.
The Washington Post (July 23)
Democrats Good; Republicans Bad; repeat.
Instead of looking to emulate the elites at the NY Times, the Washington Post, and the Boston Globe, the BDN would do well to consider that the bulk of its audience is not the radical leftist idealogues that lap up such nonsense as above, but moderate hard-working people who are tired of the feds demanding that they pay for a bloated, disfunctional wasteful bureaucracy that uses their tax dollars to buy votes and win favors. One day, they may wake up to this fact, and should they do so, their circulation is guaranteed to rise.
The Republicans have it right on this one when they say, “We do not have a revenue problem; we have a spending problem.”
When truth and facts are tools of “radical leftists” in all likelihood, it’s you that’s the radical idealogue. You don’t sound like a moderate at all, you sound like screeching parrot who watches too much Fox News.
ole danny is a t-r011
Speaker Boehner Releases List of 88 Economists Who Agree Obama Tax Plan Will Hurt Small Business & Further Damage Economy
http://www.speaker.gov/press-release/speaker-boehner-releases-list-88-economists-who-agree-obama-tax-plan-will-hurt-small
“Economists say the looming tax hikes threaten private-sector job growth, and are calling them everything from “patently irresponsible” to “misguided in the extreme”:
•“Small businesses – which stoke employment growth in this country – will be hit by these increased tax rates,” said Dr. Susan Feigenbaum of the University of Missouri-St. Louis Department of Economics. “Compounding this will be the ObamaCare mandates and additional tax hikes. If you are currently unemployed, you’ll be able to thank these tax increases for remaining unemployed [next year].”
•“The tax hikes scheduled to hit the American economy on January 1, 2013, are misguided in the extreme. Expenditure cuts – of all kinds – are the path to fiscal responsibility,” said Dr. Jeffrey Miron of Harvard University.
•“It is patently irresponsible for Congress to allow massive tax increases to kick in while the economy is still weak,” said Dr. Corrine Krupp of Duke University. “It is even more irresponsible to create and foster an environment of uncertainty about future taxes now when households and businesses are planning for the future. Members of Congress should sit down and do the work they were elected to do, and stop the race to the fiscal cliff.”
That “indepedent account firm” who did the study was paid for by industry groups. Why are you so eager to only look at information that you like?
Why are you so envious of the accomplishments of others that you feel justified in demanding they pay even more taxes when the top 10% already pay 70% of all income taxes while the bottom 45% pay zero, and some even make money though the Earned Income Tax Credit fraud?
Economics 101: you don’t raise taxes in a sour economy. This is a fundamental truth you would do well to accept rather than continuing to live in denial.
LOL, nice try, but there is no need to derail the conversation. This isn’t about class envy.
This is about you using biased information to support your claims. Don’t pretend like you’re using facts when all you have are slanted studies and baseless personal attacks.
You can uses your phony economics 101 things all you want, but the reality is that our economy was doing pretty great in the Clinton era. We’re still working on cleaning that Bush era mess.
What is biased about stating that the top 10% pay 70% of the taxes?
What is biased about stating the its bad economic policy to raise taxes during an economic downturn?
Your posts are all the same never addressing the topic but rather the poster. Did you learn that from the democrats?
It’s biased because you’re not providing the whole picture. You’re trying to pretend like that top 10% don’t rake in the majority of the wealth in this country. You’re trying to pretend they don’t hold the vast majority of wealth in this country.
It’s biased to cite a study that is funded by industry groups because they are the top 10%/top 1% — of course they’re going to provide results like that. It contradicts what other non-biased sources are saying.
Your claim about me is obviously false. Enough with the attempts to derail the conversation. Enough with the stupid and sweeping generalizations about groups of people.
That 10% pay 70% is not a study but a statistic put out by the IRS. I would consider the IRS an unbiased source. Only an imbecile would think differently.
We tax income and not wealth in this country
That wasn’t my point! Read the comment before you start launching your ridiculous personal attacks. You’re plucking one piece of the puzzle out of its context and then presenting it as though somehow that’s illuminating or truthful. It’s not. I notice how you’ve conveniently ignored my questions because it proves your dishonest. What percentage of income and invest income does that top 10% make? Here’s a hint: it’s about proportional to what they pay in taxes! Wouldn’t know that from reading your comments though because you’re biased and trying to distort the issue. Obviously they’re going to pay more in taxes, they make more money.
I didn’t say we tax wealth. But income and wealth are obviously interconnected.
That’s why it’s hard to be an informed voter now-a-days. You have to work harder to see if there is bias in your information source.
It’s a great stand because the Republican plan doesn’t extend breaks that benefit the middle class. That’s 25 million people who under the Republican plan will see their taxes go up significantly.
Make the limit $125,000. Fewer and fewer households are there anyway, at least around here.
We have both. We undoubtedly could use our resources better, but we will be unable to get out of this recession and reduce the deficit (which everyone wants, not just Republicans) without more revenue. How about we stop giving tax breaks to companies that keep their jobs off shore?