As for targeting “families” making more than $250K per year, a substantial number of them are actually small business owners who create 65 percent of net new jobs. The president contends that 97-98 percent of those businesses earn less than $250K. That number remains in dispute, but even if one concedes that it is accurate, ABC News reports such a figure represents 894,000 small businesses that will see their taxes go up — and, just as likely, the number of people they employ go down as a result.
And then there are the political ramifications of the president’s proposal. Republicans are predictably against it, but some Democrats may not be on board either. The Wall Street Journal reports that “as many as six Democratic Senators are hedging their bets as the economy looks worse,” and that two of them, Joe Manchin (D-WV) and Jon Tester (D-MT), prefer to overhaul the existing tax system along the lines of the Simpson-Bowles plan that lowers tax rates and closes loopholes. Mr. Obama commissioned that plan–and then proceeded to ignore its recommendations.
Overall tax reform is favored by many Republicans, all of whom, along with some nervous Democrats facing tough re-election battles, are eager to avoid ”Taxmageddon.” Taxmaggeddon is the term coined to describe the massive $494 billion tax increase facing Americans in 2013, unless Congress acts to forestall it. It reflects the expiration of the Bush tax cuts as well as several other tax increases, including a capital gains rate rising from 15 to 23.8 percent, and a dividends tax increase from 15 to 43.3 percent. Both of those will help finance the now-constitutional healthcare bill. According to the Heritage Foundation, families will see an average tax increase of $4,138, and low-income taxpayers can expect a $1,207 increase. Any or all of these taxes will kill any chance of a genuine job-generating, economic recovery.
Thus it is no surprise that both sides of the aisle concede that Obama’s latest gambit isn’t going anywhere until after the election in November. Yet Republicans intend to make it difficult for Democrats before then. Since the House is where spending bills originate and it is controlled by the GOP, Republicans are on the verge of passing a one-year extension of all the tax rates. This puts Senate Democrats in the position of having to decide–before Election Day–if they want to assuage their leftist, class-envious base by favoring a gargantuan tax increase in the midst of a shaky recovery at best, or the beginning of another recession at worst. One that would undoubtedly be exacerbated by the largest one-year tax increase in the history of the nation.
More to the point, as Bill Clinton himself admitted, before being brow-beaten back into the fold by his fellow Democrats, no tax increase makes sense in a weak economy. And that economy may be worse than advertised. Most Americans are unaware of the fact that the Labor Department uses something called a Birth/Death model to calculate the number of jobs created in any given month. That number is literally based on a guess about the number of jobs created by businesses too new to be counted in the Bureau of Labor Statistics (BLS) formal survey. In June, the BLS added 124,000 jobs to the total number created — meaning that without the estimation the total count would have been a loss of 44,000 jobs. Even more tellingly, such calculations tend to be very optimistic during springtime and neutral during summer, meaning the next three months will reflect far more accurate — and likely, far more dismal — job numbers.
So why is the president pushing a tax increase? Because Obama is all about one thing and one thing only: himself. Beneath the populist facade, he remains a dedicated socialist/Marxist attempting to win re-election by any means necessary. If it means pushing America into a double-dip recession, costing fellow Democrats their seats in the House and Senate, and/or turning Americans against one another, whether that division is based on class, race, sexual orientation or religious beliefs, so be it. Perhaps the only thing more reprehensible is a wholly compromised mainstream media willing to abet the charade with their seemingly coordinated characterization of this gambit as a “middle class tax-cut extension,” rather than the tax increase it truly is. Despite their protestations to the contrary, they too are “all in” with getting Barack Obama re-elected.
Finally, no debate regarding taxes or tax rates can be considered serious until Obama addresses the one issue he and his fellow Democrats have studiously avoided: out-of-control spending. Such calculated irresponsibility is the essence of adolescent thinking in a country that desperately needs to have an adult conversation about the limits of government benevolence. The president and his party prefer to blame Americans for not paying their “fair share.” That may resonate with many Americans. But it is completely at odds with the reality of a nation heading towards bankruptcy, all the tax hikes in the world notwithstanding.
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