“Obama’s ‘rosy’ budget scenario doubles down on class warfare”
From “Hope and Change” to “Hope, but Keep Trying the Same Shit That Won’t Work No Matter How Many Times We Insist It Will If We Just Give It Another Chance.”
Which, that doesn’t have quite the same easy bumpersticker grace to it, seems to me. James Pethokoukis:
[…] Obama’s new budget isn’t about economic growth or cutting debt or creating a “built to last” economy. The Obama campaign is built around the idea of reducing inequality. So in his budget, Obama takes the populist whip to the wealthy and to business:
1. The top income rate would be raised to 39.6 percent vs. 35 percent today.
2. Under the “Buffett rule,” no household making over $1 million annually would pay less than 30 percent of their income in taxes.
3. Between now the end of a second Obama term, Obama proposes $707 billion in “net deficit reduction proposals.” Of that amount, only 16 percent is spending cuts.
4. The majority of small business profits would be taxed at 39.6 percent vs. 35 percent today.
5. The capital gains rate would rise to 25.0 percent (including the Obamacare surtax and deduction phase out) from 15 percent today.
6. The double-tax on corporate profits (including dividends) would increase to 64 percent based on the statutory corporate tax rate (58 percent using the effective tax rate), easily the highest among advanced economies.
7. The double tax on corporate profits (including capital gains) would increase to 51 percent (44 percent using the effective tax rate), also among the highest among advanced economies.
All in all, Obama has proposed some $1.6 trillion in new taxes over ten years, taking tax revenue as a share of GDP to 20.1 percent in 2022 vs. a historical average of 18 percent. And despite all those new taxes, Obama’s plan would still add $6.7 trillion in new debt and make no progress in lowering the nation’s total debt levels as a share of output. The debt-to-GDP ratio is predicted to be 74.2 percent this year and 76.5 percent in 2022.
At the same time, federal spending would never fall below 22 percent of GDP. Indeed, Obama — if he serves two terms — would be the first U.S. president in history to spend 22.0 percent or more of GDP for eight straight years (and then beyond). And keep in mind that these debt and spending numbers claim about $850 billion in savings from unwinding the wars in Iraq and Afghanistan, spending about a quarter of those phony “savings” on highway funding.
And also don’t forget about the rosy growth assumptions of 3.4 percent growth in 2015, 4.1 percent in 2016, 4.1 percent in 2017, and 3.9 percent in 2018? The U.S. economy has only seen a run like that three times in the past four decades. And the Obama Boom is supposed to happen amid rising tax rates, interest rates and debt? Good luck, Mr. President.
Luck? Who needs “luck” when you can use the Constitution when it supports your position, ignore it when it doesn’t, and demonize it should you need to rile up your progressive base of grievance-politics identity groups looking for ways to game the system to their selfish advantage?
It’s good to be the king.