We already know a little bit about B. Hussein Obama’s proposed economic policies. They are all of a Socialist nature with aims at redistributing wealth by taking money away from those who earned it and giving it to those who did not earn it.
John Lott, a senior researcher at the University of Maryland looks into Obama’s proposed policies and shows us how they will a) do even further damage to a weak economy and b) discourage people from working harder to earn a better living. From Fox News:
|While Obama would directly increase the marginal income tax rate on families making more than $250,000 per year and raise the rates on capital gains and dividends, he has a whole set of new and expanded tax breaks for the poor, retirees, students, homeowners and new farmers. All these tax breaks phase out with higher incomes, producing high effective marginal tax rates for those with low incomes as well as for people making between $100,000 and $120,000.
The effects of these phase-outs are dramatic. Alex Brill and Alan Viard, at the American Enterprise Institute, show that a two-earner couple with two children (one of whom is in college) can face a 34 percent marginal tax rate when they earn $31,000, with the tax rate rising to 39 percent when their family income reaches $45,000. And families making $110,000 to $120,000 may have to think twice about making more money with the federal income tax alone taking almost half of each additional dollar they make.
The more money that is taken away from hard working people, the less those people will want to work. Obama doesn’t get it. He also doesn’t get the flip side of that coin: If people are being paid by the government not to work, they will have no incentive to work for themselves.
But Obama’s lackeys are doing everything they can to sell this Socialism:
|The Tax Foundation points out that when Obama’s plans to increase Medicare and Social Security taxes for higher-income individuals are included, one “gets to a nearly 50 percent (federal) tax rate.”
This past Thursday (Austan) Goolsbee and Jason Furman had an op-ed in the Wall Street Journal claiming that the top tax rates in Obama’s plan would not exceed “their 1990s levels of 36% and 39.6%” even when “including the exemption and deduction phase-outs,” and that all other brackets would remain unchanged. Yet, this is obviously false given that the marginal tax rates of 36 percent and 39.6 percent would be hit even if there were absolutely no phase-outs in the tax code.
Surely, Goolbee and Furman must have known this. Either they are completely ignorant of how the tax system works or they are deliberately spreading false information.
And Lott takes on a very popular argument among leftists about the rich paying their fair share. Read this:
|During the primaries Obama often spoke about the inequities in the tax system, with wealthy individuals not paying their fair share.
Yet, one is hard-pressed to see the wealthy not paying their share of taxes or Bush’s reforms increasing inequality. In 2006, the top 50 percent of taxpayers made seven times the income of the bottom 50 percent, but they paid 32.4 times as much in taxes. Does anyone really believe that those in the top 50 percent got even seven times the benefits from government that those in the bottom 50 percent received?
The distribution changed as well:
|When Bush became president in 2001, the top 1 percent of taxpayers paid about 34 percent of all income taxes. By 2006, their share had risen to 40 percent. Meanwhile, the share of income taxes paid by the bottom 50 percent had declined from 4 to 3 percent.
Barack Obama’s plans are an economic disaster waiting to happen. We need to educate all Americans about the realities of economics and show exactly how bad a Socailist like B. Hussein Obama can be for us.
You can access the complete column on-line here:
Obama’s Tax Proposals Make A Complex System Worse
August 18, 2008