What wildly unpopular Obama legislation cut your taxes? See answer below
The American Recovery and Reinvestment Act — otherwise known as the “stimulus” — has been widely derided as a prime example of government spending, a massive boondoggle of pork and giveaways. Certainly, that’s the way it’s being portrayed by Republicans on the campaign trail.
But one-third of the legislation was in the form of tax cuts that went to 95 percent of households. Tax cuts?
That’s right.
The Obama administration made the decision not to advertise the tax cuts, though — believing that consumers were more likely to spend the money if they didn’t really notice they had it. The administration includes several economists who study consumer psychology, and they didn’t want consumers to use the tax cuts to pay bills or add to the savings account.
The administration wanted them to spend it for groceries or gas or clothing or whatever. So they simply reduced the amount of money that the government withholds for taxes. That resulted in paychecks just slightly larger.
As a stimulus move, the tax cuts succeeded. As a political move, not so much. From The New York Times:
In a troubling sign for Democrats as they head into the midterm elections, their signature tax cut of the past two years, which decreased income taxes by up to $400 a year for individuals and $800 for married couples, has gone largely unnoticed.
In a New York Times/CBS News Poll last month, fewer than one in 10 respondents knew that the Obama administration had lowered taxes for most Americans. Half of those polled said they thought that their taxes had stayed the same, a third thought that their taxes had gone up, and about a tenth said they did not know. As Thom Tillis, a Republican state representative, put it as the dinner wound down here, “This was the tax cut that fell in the woods — nobody heard it.”
Actually, the tax cut was, by design, hard to notice. Faced with evidence that people were more likely to save than spend the tax rebate checks they received during the Bush administration, the Obama administration decided to take a different tack: it arranged for less tax money to be withheld from people’s paychecks.
They reasoned that people would be more likely to spend a small, recurring extra bit of money that they might not even notice, and that the quicker the money was spent, the faster it would cycle through the economy.
Of course, Republicans knew that the stimulus bill contained the largest one-year tax cut in US history, and they still refused to vote for it. In reflecting on his first two years in office, NYT writer Peter Baker wrote that Obama might do a few things differently:
Perhaps he should not have proposed tax breaks as part of his stimulus and instead “let the Republicans insist on the tax cuts” so it could be seen as a bipartisan compromise.
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603 comments Add your comment
Loren
October 19th, 2010
7:18 am
“It should be a moment of reflection for Democrats. When you forfeit the South, your sights tend to drift too far left.”
Great quote in the NY Times this morning.
dougmo2
October 19th, 2010
7:25 am
Still doesn’t change the fact that after November he is effectively neutered. You can write till your fingers fall off CT, it is not going to change a thing. Deal with it. BTW do you still feel that he tried to hard to get along with Republicans or did you take that beatdown grac efully?
BlahBlahBlah
October 19th, 2010
7:32 am
It’s too late. 11/2 is a tidal wave. All the left-wing cheerleading in the world won’t change it.
granny godzilla
October 19th, 2010
7:35 am
Funny how popular the stimulus plan REALLY was with republicans…..
You know how they do, scream and get red faced about it in front of the cameras and then……Stimulating Hypocrisy: Scores of Recovery Act Opponents Sought Money Out of Public View
Watch that old GOP carefully – their lips are moving and we know what that means!
T-Town
October 19th, 2010
7:36 am
$800 tax cut for the year works out to about $15 a week, maybe 3 pks of cigarettes, or an 18 pk of beer, or maybe 2 movie tickets, or may be able to feed a family of 4 at McDs. Noble cause, but much like peeing in a wetsuit….gives you that warm and fuzzy feeling, but nobody really notices.
stands for decibels
October 19th, 2010
7:41 am
In a New York Times/CBS News Poll last month, fewer than one in 10 respondents knew that the Obama administration had lowered taxes for most Americans.
I don’t enjoy these at all, but for the record, I’m having one of those “I really am surrounded by idiots” moments.
stands for decibels
October 19th, 2010
7:43 am
Are Americans really that stupid? I mean, I can understand them being dispirited over a horrible jobless recovery, I can see them blaming the guy who’s been in office for 20 months because it seems like plenty–plenty!–of time to fix everything that’s effed up if you don’t know any better.
But not knowing the recovery act lowered taxes for most Americans?
You’d have to be actively ignoring the news not to know that. or, I guess, getting your “news” from utterly crap sources. I guess it’s the latter.
Jayzus.
Poor Boy from Alabama
October 19th, 2010
7:43 am
Putting lipstick on a pig does not change what it is. The stimulus has not met expectations. Unemployment is well beyond what the administration promised before the stimulus was passed.
As for the tax cuts portion of the stimulus, they did not increase consumer spending. As Gallup reported just a couple of days ago:
gallup.com/poll/143651/Lower-Middle-Income-Spending-Lowest-January.aspx
“Lower- and middle-income Americans’ self-reported average daily spending in stores, restaurants, gas stations, and online averaged $48 per day during September — down $6 from August and $16 from July. Consumer discretionary spending by these Americans making less than $90,000 a year is now at its lowest level since Gallup began daily tracking in January 2008, as the recession was just getting underway.”
The real issues is that the overall economic climate in this country is clouded by uncertainty. Consumers fear for their jobs and have curtailed spending. Businesses are still coming to grips with the thousands of pages of new regulations and are sitting on record amounts of cash.
You add it all together and you’ve got a weak, relatively jobless recovery. No amount of spin will change that.
Going forward, the real question is whether the administration will change course and help create a more favorable economic environment that will accelerate the recovery and lead to jobs creation.
I Report :-) You Whine :-( mmm, mmmm, mmmmm! Just sayin...
October 19th, 2010
7:46 am
The administration wanted them to spend it for groceries or gas or clothing or whatever. So they simply reduced the amount of money that the government withholds for taxes. That resulted in paychecks just slightly larger.-Queen Pinko, Urinal
Wait until all the dimwits figure out that their tax rate for the year remains unchanged and that they have to pay back their “tax cuts.”
Or maybe they won’t figure it out, like the dummycrats are hoping…
Booger Presley
October 19th, 2010
7:48 am
Oh well…Obama shouldve stated such. Then again giving 2 cents with one hand and taking away 12 cents with the other is nothing to brag about.
The Obama tax cut will not even come close to the increases if the Bush tax cuts are allowed to expire AND we also have this wonderful ObamaCare debacle that will cost even more.
In short Obama has done the taxpayer no favors…All smoke and mirrors.
LV
October 19th, 2010
7:49 am
There you go again, Cynthia. Pointing out the obvious. But please, do not expect anything except insults to Obama, that’s all you’re gonna get.
It's The Truth, And You Know It!
October 19th, 2010
7:57 am
That Obamer has not done anything good for people. He’s just put them deeper in debt. If we can get Joe Miller from Alaska and Christine O’Donnell from Delaware in there we’ll have it made. There will be jobs all over the place.
Miller/O’Donnell 2012
granny godzilla
October 19th, 2010
7:58 am
Miller/O’Donnell 2012
“We won’t handcuff witches”
Frederick Michael
October 19th, 2010
7:58 am
If your reaction to this article is, “What tax cuts?” you’re not alone. Since Cynthia didn’t tell us what these “tax cuts” were, I checked the linked NY Times article. The truth is that Obama extended the 2008 cut but replaced the 2008 rebate with a lower withholding rate. This backfired in many ways (see the NYT article) as the rebate led to more spending by the recipients.
And calling this change a tax cut is a stretch.
Bubba Bob
October 19th, 2010
7:58 am
Even with this I was against the stimulus. None of this matters to me. We need to cut spending and get out of debt. Raise taxes some to do it as long as spending is cut.
Quit fooling around the periphery and get to the meat.
Georgian
October 19th, 2010
7:59 am
Cynthia,
You must get a different check than I do, because I got no “bump” in mine. There was no decrease in taxes.
Will Collier
October 19th, 2010
8:02 am
You really are a complete hack, Cynthia. Does it bother you at all to collect a paycheck as a “journalist” when all you’ve done for the past two years is recycle administration spin? You’re a disgrace.
Traitor
October 19th, 2010
8:02 am
Lincoln, second only to Obama as our greatest prez, was also despised and foiled at every turn as he tried to save the Union.
History will erect a monument to Obama in the hearts and minds of future patriots. America will know.
Bush will still grow in esteem in the eyes of revisionist terrorists so that all future foreign and domestic enemies of the US will revere him.
GObama 2012. uh, huh! gobama, uh huh. UgoGirl!!
JKL2
October 19th, 2010
8:05 am
granny- Watch that old GOP carefully – their lips are moving and we know what that means!
Yes, you’re hearing the truth for once. Words spoken by a man/woman ans not a teleprompter. Maybe we could just attach Heather from Garmin to the teleprompter and the president could go back to playing golf.
If the Democrats insist on throwing fists full of cash up in the air, you would have to be an idiot not to jump up and grab a few dollars for yourself.
Georgian
October 19th, 2010
8:06 am
Obama may get a monument for being the first black president, but for not much else. Im not sure how they will do that though, maybe with chocolate?
Good Grief
October 19th, 2010
8:08 am
What wildly unpopular Obama legislation cut ‘my’ taxes? Let see, Considering that I went from 25% of my paycheck going out in taxes to 30% going in taxes, I’m gonna say none. Of course, I understand that in Democrat math, if you give someone a $250 check, that’s considered a tax cut.
Georgian
October 19th, 2010
8:09 am
Cynthia,
I also find your claim that “they just chose not to advertise that they were cutting our taxes” as a JOKE! That is the craziest thing in the whole post. This admin. is all about doing what it can for a vote, so if you think they would not have advertised that they had saved Americans money, then you are crazier than I thought.
Also,I dont recall anyone telling me, oh I suddenly have extra money in my paycheck. It is helping me with buying groceries, gas and other needs. This is a JOKE!!!
Joe Broz
October 19th, 2010
8:11 am
Cynthia, are you nuts? Changing the tax with holding without changing the tax rate is simply a dishonest ploy to trick taxpayers into spending money that they are expecting to be with held so that they can pay their tax bill at the end of the year. It does not change the tax that they will be accountable for at the end of the year by even one cent! If I wanted to, I could adjust my with holding myself with a simple w-4. I don’t need Obama to do that. This is a dishonest ploy by a dishonest administration. You are talking down to us when you try to present this as some kind of beneficence from our government. It is not!!!
Georgian
October 19th, 2010
8:11 am
Lets see….
Insurance premiums are going up, taxes in pay are going up, income taxes are going up if Obama and Dems have their way, the cost of everything is going up? How OH how did King Obama save us?
granny godzilla
October 19th, 2010
8:11 am
JKL2
Made up any good quotes lately?
Oh right….you did.
BTW Teleprompters are inanimate objects.
JKL2
October 19th, 2010
8:12 am
Maybe they should called it the Obama taxcut bill and brought that up for a vote in congress instead of throwing more unrelated items and earmarks into an unrelated bill the way they always do.
Jethro
October 19th, 2010
8:12 am
I don’t blame Obama. I blame Reid and Pelosi. They are the leaders of political discourse in this country.
But I can’t blame them without blaming previous Congressional leadership. The reasons they are the party of “no” happened long before the pundits coined the catch phrase.
The bottom line is that our political leaders don’t converse with one another. They communicate instead through soundbites and snippets. To paraphrase George Bernard Shaw, they don’t care what they say so long as they pronounce it correctly. We have not been watching debates. We have been watching competition for the “sound bite du jour.”
It’s disheartening. We need leadership, we need discourse. We get “man up.”
Nothing Is Free
October 19th, 2010
8:12 am
This is great. Tax cuts that we didn’t even know about.
We must actually be doing great under this Obama administration.
The people who have lost their jobs? It’s all in their minds. The people who have lost their homes? they can move back. it was just a big joke. Ha Ha Ha.
Silly Republicans. They actually believe those racist numbers that say we have lost millions and millions of jobs under Obama. They actually believe that all those racist banks actually kicked people out of their homes because they couldn’t pay their mortgage.
I feel so much better. We are actually doing great and we didn’t even know it.
I’m convinced.
Two more year!!!!
Two more years!!!!!
Another two years like this last one and we’ll all be millionaires.
Hail Obama!!!
Hail Obama!!!
He’s saved us!!!
He’s saved us!!!!
andygrd
October 19th, 2010
8:14 am
FROM MSNBC: WASHINGTON — Democrats are making a pre-election pitch to give Social Security recipients a one-time payment of $250, in a move described as “a last-ditch election-year Hail Mary” by a Republican spokesman. The Democrats’ plan is part of a larger effort to convince senior voters that their party, and not Republicans, will best look out for the 58 million people who get the government retirement and disability benefits. The $250 check is meant to make up for a second year without a cost-of-living increase due to low inflation.
First the Dems said we were stupid, then they told us we did not understand, then they told us our views are and have been swayed by the conservative news media.
Wow, after looking up the definition of bribery, this sure sounds like one to me……
DEMS…. Seniors are not that stupid….. we / they will not fall for this one….. My oh my you are getting desperate………
So they can win on merit, so bribery……. and, if it was a tax cut, every DEM would be telling the world, but it seems as thought the DEMS are running from the President….. Tell me why the Dems are running from the President?????
What is “slightly larger”? How much? Sure would like to see the numbers……..
Eric Pearson
October 19th, 2010
8:14 am
President Obama has been and will continue to be a far, far better president than what we’ve become accustomed to. It doesn’t matter. His detractors don’t want a good president. I don’t know what they do want, they may not know either. What is glaringly apparent is that they just don’t want this Black President. I’ve heard all the arguments that it’s not racial. I don’t believe a word of it. It is racial. There is no other logical explanation.
Georgian
October 19th, 2010
8:16 am
“Faced with evidence that people were more likely to save than spend the tax rebate checks they received during the Bush administration”
Who did that? Myself, I know I had my stimulus check from Pres Bush spent before I even got it, as did MANY people I knew. Just where does this research and polls and info come from you get Cynthia?
Nothing Is Free
October 19th, 2010
8:17 am
Eric Pearson
Oh you are so right.
9.6% unemployment is sooooo much better than 4.7% unemployment.
And he really cares about us. He really does.
He loves each and every one of us
And he will continue to care about us no matter how many of us lose our jobs and our homes.
Obama is such a good guy.
Racist Republicans!!!
granny godzilla
October 19th, 2010
8:20 am
Nothing is Free
Eric is right.
JKL2
October 19th, 2010
8:21 am
granny- BTW Teleprompters are inanimate objects.
So is our president. Now go back to watching your comedy news channel.
PS: Just because someone put something on the internet doesn’t make it factual. Sorry I don’t have everything obama ever said recorded and catalogged for you. Doesn’t mean he didn’t say what I paraphrased (IE: not an actual quote). Just means I don’t have time to search 1 million hits to find his when then search engine always comes up Robert Gibbs speaking first.
Georgian
October 19th, 2010
8:21 am
Eric,
Tell me one thing that makes Obama better than the others?
What has he done?
None of the policies he has enacted has helped us, he constantly makes the USA a mockery apologizing for us left and right making it seem WE are the third rate country. He has fumbled the BP Oil Spill. He has done NOTHING to create ANY positive job increase and he has done nothing to help the common man.
He has delivered on NONE of his promises. How does this make The Great Telepromter our greatest of greatests?
JKL2
October 19th, 2010
8:23 am
Nothing is Free- He’s saved us!!!!
Isn’t this like all the people crying in the streets after Stalin died?
stands for decibels
October 19th, 2010
8:24 am
Tell me one thing that makes Obama better than the others?
What has he done?
The Lilly Ledbetter act, and every piece of legislation he’s signed since.
Nothing Is Free
October 19th, 2010
8:24 am
granny
Oh he is.
I love the fact that the economy is in the toilet. It’s so good for everyone.
the fact that we have experienced the highest increase in poverty under Obama is teaching people how to live in cardboard boxes, and what can be bad about that?
Hundreds of thousands of people will have their health insurance dropped because of his wise and benevolent Insurance Enrichment Act. It’s good that women are being told that breat exams are just silly.
It’s really good for everyone
You are so right granny.
Obama is really great!!!
uga's FL's bitch
October 19th, 2010
8:26 am
Once again this Cut-and-Paste queen fails to realize that higher taxes will be inevitable to pay for, the perpetually clueless, obama’s waste of nearly $1 Trillion dollar on useless social programs and un-shovel ready projects. This clown’s plan to destoy the middle-class and transfer its wealth to the lazy and unemployable is succeeding.
Nothing Is Free
October 19th, 2010
8:26 am
JKL2
Stalin and Obama. Two peas in a pod.
Leaders that really care about their people.
Socialism.
Hasn’t it always worked well in the past? I’m sure it will work just as well here.
Richard
October 19th, 2010
8:27 am
I agree with one of the above comments. Reducing the rate of withholding without reducing the tax rate merely causes the taxpayer to unwittingly borrow money against the tax bill he will ultimately have at year’s end, and to spend money that he really doesn’t have. It’s the exportation of government fiscal misbehavior to the individual.
Call it like it is
October 19th, 2010
8:27 am
People read the whole article that Cindy copied and pasted. As an opinion writer she comes up with an idea then scours the article to pick out what she wants to support her beliefs, and then only attaches the parts she wants. Tax Cut, hardly.
granny godzilla
October 19th, 2010
8:27 am
JKL2
Well then…. perhaps you have learned your lesson and will no longer bear false witness…..
I’ll be watching.
Joe
October 19th, 2010
8:27 am
Again Tucker you’re being dishonest to your hand full of readers. Sure you got more take home pay for the whole year but when tax time rolled around you had to pay whatever was owed according to your tax bracket. In other words you got less back when you filed your taxes. You can pull the wool over the eyes of the less educated Tucker but those who stay informed see you idiot logic and just laugh….
Dr ooze
October 19th, 2010
8:27 am
We want a President who is a strong, tough willed, leader. Not a mamby pamby jackwagon….
Oops...another hater
October 19th, 2010
8:28 am
“What is glaringly apparent is that they just don’t want this Black President. I’ve heard all the arguments that it’s not racial. I don’t believe a word of it. It is racial. There is no other logical explanation.”
Congratulations on being First of the Day!!
Avenger
October 19th, 2010
8:28 am
Eric. After several years of racism, what else would you expect out of double talking clowns.
John
October 19th, 2010
8:28 am
i see granny, i mean cynthia is busy posting her propaganda trying to convince us obama is doing a great job
tell it to the unemployed and under employed
granny godzilla
October 19th, 2010
8:28 am
NIF
Eric remains right.
stands for decibels
October 19th, 2010
8:28 am
Racist Republicans!!!
Well, they’re sexist, too.
I am certain that a President Hillary would’ve had to have endured every bit as much raw hostility from the opposition party and its idiot followers, than has Obama. Sexism is far more socially acceptable than is racism in America; it doesn’t have to be cleaned up and projected into silliness like the birth certificate “controversy.”
If it were President Hillary, you’d just be calling her “that b!tch” openly, without fear of reprisal, instead of calling Obama “that half-n!gg3r” in private.
anyway, I’d love to hang out and chuckle over Teahadist denial on this particular topic (yes, your tax rates DID go down), but some of us gotta go produce goods and services of value for the market place. later.