Promise Meets Expiration Date
Barack Obama, August 5, 2009:
The last thing you want to do is to raise taxes in the middle of a recession because that would just suck up — take more demand out of the economy and put businesses in a further hole.
While all of Obama’s promises carry an expiration date, perhaps the “Buffett Tax” is the exception that proves the rule, since it’s merely a poison pill:
Most of this is in bad faith, anyway. Obama’s “proposals” are not true proposals. He doesn’t want a law; he wants an issue for the 2012 election. Every fake proposal he makes has a built-in poison pill to make it objectionable to Republicans, by design.
He’s already announced his plan for 2012 is a Harry Truman-like run against a “Do-Nothing Congress.” Obviously that plan can only work if Congress rejects his ideas; and he’s making sure they will, by always sticking a poison pill in.
That’s not an accident. And that’s not Republican recalcitrance. That is a cynical non-plan by a man who is willing to let the economy tank further so long as he can claw some political advantage out of the wreckage.
One point five trillion in tax hikes from the man who just recently said “He’s absolutely right, you don’t want to raise taxes in the middle of a recession.”
It should be noted that his wiggle-room there is always his claim that these taxes will not actually kick in for a couple of years, when the recession has ended.
You know, like it’s already ended, supposedly.
But it did, didn’t it? It was in all the papers:
“Obama’s wiggle-room is always his claim that these taxes will not actually kick in for a couple of years”.
The real, current tax burden is government spending. Government spending directs current, real resources into wasteful or useless projecs, and denies a flow of resources to businesses which would like to produce more useful products with more employment.
The timing and amount of tax collections or imposed inflation is only how it distributes the burden of that spending. Government borrowing and delayed taxes are merely settling the bill.
A government may even distribute tax rebates. But, real taxes are higher if it increases the size and spending of government. Government is taking a bigger share of current, real resources, leaving less for private use, investment, and private employment. Production is immediately lower, and future collections of production (taxes) will have to be higher. A double whammy. Whatever government is providing had better be worth the large cost.
Respected economist Milton Friedman pointed out that the burden on the private sector is bigger when the government grows as a percentage of the economy. We must reduce government spending.
Consider as an extreme case what our lives would be like if government spent 80% of national production (GDP). Government would be directing 80% of all activity. It would not matter what parts were collected in taxes, were borrowed, or were taken by the Federal Reserve through inflation. Taxes would explicitly apply the burden. Borrowing would somewhat hide and delay the burden. Creating money would apply the burden as a decrease in the value of all dollars, effectively and silently levying a tax on anyone saving or being paid in dollars.
The Real Tax Burden