Today, President Obama unveils his deficit reduction plan. You’ll be shocked, I’m sure, to learn that he is proposing massive tax hikes on Americans who make more than $200,000 per year.
President Barack Obama will propose $1.5 trillion in new taxes as part of a plan to identify more than $3 trillion in long-term deficit reduction and slow the nation’s escalating national debt.
Obama’s tax plan is aimed predominantly at the wealthy and draws sharp contrasts with congressional Republicans.
It comes just days after House Speaker John Boehner ruled out tax increases to lower deficits. It also comes amid a clamor in his own Democratic Party for Obama to take a tougher stance against Republicans. And while the plan stands little chance of passing Congress, its populist pitch is one that the White House believes the public can support.
The plan stands so little chance of passing Congress, largely because it has already failed. Obama proposed similar tax hikes in 2009, to a Congress controlled entirely by the Democrats, and it flopped.
Obama’s plan also includes some Medicare cuts, but those aren’t likely to go very far either:
Administration officials said 90 percent of the $248 billion in 10-year Medicare cuts would be squeezed from service providers. The plan does shift some additional costs to beneficiaries, but those changes would not start until 2017.
The first part of that would drive service providers out of the Medicare market; the latter is just kicking the can down the road again. And then, there’s the “Buffet tax.”
Illustrating Obama’s populist pitch on tax revenue, one proposal would set a minimum tax on taxpayers making $1 million or more in income. The measure – Obama is going to call it the “Buffett Rule” for billionaire investor Warren Buffett – is designed to prevent millionaires from taking advantage of lower tax rates on investment earnings than what middle-income taxpayers pay on their wages.
The AP says that the “Buffett tax” is in the president’s proposal, but Chuck Todd says it isn’t. Either way, Buffett is free to pay more than his tax returns demand of him. Or, at the moment, he is free to invest his money to help create private sector jobs and broaden the tax base. Enacting the “Buffett tax” forces him to hand his money over to the government. That seems counter productive, until you realize that Buffett more or less owns Obama.
All tolled, this tax proposal isn’t any more serious than the budget Obama submitted and saw rejected unanimously by the Senate, or his jobs bill of last week.