Obama plows ahead with plans to raise taxes, not create jobs
What better way for President Obama to welcome me back from the beach than with a wrong-headed plan to jack up income taxes on “the rich.” From the Hill:
The White House said Monday that President Obama wants to pay for his $447 billion jobs bill by raising taxes on the wealthy and businesses.
In fact, we don’t really need to go beyond that first sentence: Obama’s bright idea is to pay for a jobs bill by raising taxes on businesses. The economy be damned, this president is determined to take money from job creators and use it to renovate school buildings. That would be bad enough — but, as Megan McArdle explains, it’s already too late for school-renovation projects to navigate the federal procurement process in time for work to begin next summer. Which means we’re back to spending money on jobs that aren’t ready for shovels.
Still, let’s soldier on to the details as provided by Jack Lew, director of the Office of Management and Budget:
The chief provision…would be to limit itemized deductions for individuals who make more than $200,000 a year and families that make more than $250,000, something the Obama administration has previously pushed to do through its budget proposals. Lew told reporters at the White House press briefing that this would raise about $400 billion.
The administration would tax the income investment fund managers make, known as “carried interest,” as regular income instead of as capital gains, which has a low 15 percent tax rate. This is another longstanding administration goal that has been resisted by Wall Street as well as some Democrats.
The administration estimates the capital gains change would provide $18 billion in revenue.
The administration also wants to eliminate tax breaks for the oil-and-gas sector, which would raise $40 billion, the administration said.
Another $3 billion would come from changing the way corporate jets depreciate. With a few other revenue increases, Lew indicated the total measures proposed by the administration would bring in $467 billion, $20 billion more than the cost of the bill.
Note, above, that line about the first item being “something the Obama administration has previously pushed to do through its budget proposals.” One wonders whether Obama has produced a “jobs bill” so much as a “tax increase justification bill.”
As it happens, I agree in principle with reducing or eliminating deductions and credits from the tax code — but as a trade-off for lowering marginal tax rates. Instead, Obama plans to raise tax rates on these same taxpayers (while apparently double-counting the increased revenues as part of his deficit-reduction package). He is effectively trying to make the tax code more complicated, not simpler. And experience teaches us that the wealthy are best positioned to take advantage of a complicated tax code and send Uncle Sam less money than he expected. This is a lose-lose-lose.
And yet this is not the only major flaw with Obama’s proposal. The congressional “super committee” tasked with drafting a deficit-reduction plan this fall is expected to consider flattening the tax code — that is, removing loopholes and lowering rates — for all taxpayers as part of its package. But if Obama removes loopholes for high earners to pay for his jobs plan, does anyone really think the super committee is then, separately, going to remove loopholes for the middle class?
And without that component, everything else on Obama’s list of “pay-fors” amounts to peanuts relative to the cost of the jobs bill.
This plan will win plaudits from the likes of MoveOn.org — and given the president’s deep political problems heading into 2012, maybe that’s all it’s designed to do. But it’s a double-whammy for the millions of Americans who are out of work and tired of hoping for change.
– By Kyle Wingfield
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211 comments Add your comment
RAMZAD
September 19th, 2011
8:09 pm
If harassing “Job Creators” mean stopping them from polluting the air and poisoning the food and doping the ground water and running a chemistry lab through the streams then I say pound these “Job Creators into extinction.
RAMZAD
September 19th, 2011
8:17 pm
@Little Barry:
I bet you are one of the little frustrated and unemployed Tea Party groupies who stays here and agitate all day long. You get to hate Obama. You get to express your frustration. You get to meet up with desperate little people like yourself, and you get to hear what the latest Republican Tea Party line is.
I am sure you would not have it any other way. I wonder why the “Job Creators” don’t know you exist?
Lil' Barry Bailout (Revised Downward)
September 19th, 2011
8:22 pm
And you, RAMZAD, are likely one of those chumps who believes the meek shall inherit the earth and that karma’s a bitch.
Jefferson
September 19th, 2011
8:30 pm
72 % agree with the president. Why is that ?
Ronnie Raygun
September 19th, 2011
8:31 pm
So those rich guys that have been getting tax cuts out the wazoo and haven’t created a job in over a decade are “Job Creators”? BWAHAHAHA That’s a good one Kyle, it will absolutely kill at the Chuckle Hut.
ObamaNO
September 19th, 2011
8:32 pm
Obama Must Go ASAP!!
Tiberius - Your lightning rod of hate!
September 19th, 2011
8:46 pm
“If harassing “Job Creators” mean stopping them from polluting the air and poisoning the food and doping the ground water and running a chemistry lab through the streams then I say pound these “Job Creators into extinction.’
“Cause as we know, job creators really want people mad at them for doing things like that. . .
Tiberius - Your lightning rod of hate!
September 19th, 2011
8:47 pm
“72 % agree with the president.”
On what? Not this plan, that’s for sure.
John Lewis
September 19th, 2011
8:49 pm
OMG….Obama must go!!!!!! His plan is to destroy the American economy and let the federal government keep growing so that he will become the Grand Czar!!
Robert Littel
September 19th, 2011
8:54 pm
The president makes a solid threat to attack the sweet deal that the corporate Right and the ultra-rich, at the very top, have engineered for themselves, and the Right-wing propaganda machine comes out screaming (in unison) that the administration is engaging in “class warfare”. The truth is that out and out class warfare has been ongoing for several decades, without the general public even realizing it. While the public watched their soaps, NASCAR, and the other distractions that have become central focus in the lives of the apolitical citizenry, while they have been distracted by every new shiny object corporate America can shove into their hands (curiously all manufactured in China), the corporate Right has consolidated political power (by buying up all options) and creating a myth driven rationale (disseminated through outlets like FOX [faux] News and sold by hate radio blowhards, like Limbaugh and Beck) and codified in brown-shirt organizations like the Tea Party. Their plan, and it is in full implementation, marshaling ignorance, fear and blind stupid patriotic jingoism , is to use The Constitution and everything it is supposed to stand for, to bring our experiment in representative democracy to an end. The destruction, castration, or marginalizing, of the real press, the transfer of wealth upward (erasing the middle-class, the ending of fair wages (union busting), and reducing the function of government, by stripping it of functions that serve individuals, to only providing a military, to be used both as a tool to control other nations resources, and as a force to keep the rest of us in line with their desires (using the police power they will control)in a country where “consumer rights” supplant citizens rights, IS ALREADY HAPPENING!
The government is the only tool the people (the “WE THE PEOPLE” of constitutional fame) have, has been under assault by the forces of obscene wealth (which they mean to keep and get more of), making it an already corrupted entity, that we must seize back. The ignorant must be taught, the lazy kicked in the butt, and the pigs doing this (the Koch Brothers, et al, the McConnells, the Boehners) to us, must be exposed for what they are, thrown out of office, and/or prosecuted for their attempted overthrow of The Constitution. If we do not wake up and do this, the Corporate States of America will become the only reality and our noble experiment in freedom will be over. It is time to throw the corporate owned Republicans out of office and then purge the Democrats that have also prostituted themselves to corporate largess. Once that has occurred, it is time to break the back of large corporations, that have grown so large that they no longer believe in the American dream, proven by how willing they are to ship your jobs overseas and by their willingness to let the country fail, all to consolidate their power and wealth. It is now or never, and the corporate Right realizes this and is acting on it while they can get away with it. All the mechanisms for this plutocratic coup de etat are in place, and they must move before they are found out by the mass of society. Because they mean to win, and because they will go to any ends to achieve it (even if it means throwing us into deep economic and societal collapse), we must stop them now, or we will never get the chance again.
Dusty
September 19th, 2011
9:14 pm
Robert Litell,
My goodness, Bobbie, I believe you don’t like Republicans. Or maybe you ate something for dinner that disagreed with you. Anyway, I hope it gets better. If not, try a little PeptoBismol. Might help.
buck@gon
September 19th, 2011
9:20 pm
MarkV,
“What is lost in these arguments about lowering taxes for “job creators” and getting rid of regulations is that none of those things would have a measurable effect in the short run.”
Are your reading glasses getting foggy? Kyle proved that jobs for schoos aren’t really for the “short run”, even next summer is now too early for the federal maze to be run before shovels can start digging. What does government do in the “short run”? Well, how’s the previous 3 years of Obama showing us what the “short-run” can do? with Democrat total control? and now that Republicans run the House? These are the answers you need to contemplate before you go accusing conservatives of neglect.
You want job creation in the SHORT RUN, really? OK, put holds on limits, drilling, regulations, needling bureaucrats, mindless paperwork, Sarbanes Oxley, Dodd Frank, Obamacare, fire witless government bureaucrats. In short, GET OUT OF THE WAY.
If government would reduce itself, I’d be promoted TOMORROW, and I’d be a manager in charge of hiring at least a dozen new employees (some of whom are engineers) and in five years I might start my own business because I have a plan on the table that WILL WORK to save money, given a better present income and to be prepared for it. I’d hire people too.
buck@gon
September 19th, 2011
9:23 pm
Kyle,
Raising taxes is like government amnesty for illegals. As amnesty happens in one fell-swoop, the tax codes are implemented, period. We, who are responsible with money and who care about such things must then wait with baited breath that the “savings” actually “materialize”, which is the lingo in Washington.
The pretension that liberals have (that Jay Bookman and Mike Luckovich seem to have) that Republicans have gotten and will get their way on spending is entirely false, and is a good reason Tea Partyers remain so vigilant.
Keep up the good work.
BW
September 19th, 2011
9:25 pm
Kyle…what is the choice at this point politically? Complete capitulation? He has to draw a distinction…election be damned. Revenue is off the table for Republicans so what are Dems going to run on? Spending cuts to entitlements?…may as well stay home next November.
buck@gon
September 19th, 2011
9:27 pm
Jefferson,
“72 % agree with the president. Why is that ?”
Because it was a crappy push poll designed to help the President. Only Obama’s bitter, hard-core leftist base believes the answer to our current recession is to get more money into the hands of Obama. I think that phrase ought to make people laugh, actually.
Care to discuss Obama’s approval ratings as well as Congress’ bipartisan aloof treatment of little Barry’s bill?
rug rat
September 19th, 2011
9:27 pm
Robert Little! AMEN
buck@gon
September 19th, 2011
9:34 pm
BW,
YES, please do stay home next November. Obama has to draw a distinction? Yes, again. He can’t have his 20% wingnut base thinking he’s a tool of “the rich.”
If a cut in government is so unfathomable to you, then I’m sorry you see it as the first and most important priority for citizens of this country. Actually, government was designed to provide for the common defense, promote general welfare and secure liberty. 3 things Obama has failed utterly to even talk about, much less promote successfully. Government is NOT the people, but it was designed to be FOR them.
The Dems voted to keep the Bush tax rates all by themselves without rasing taxes. THEY obviously had no concerns about “revenue.”
Why does Obama suddenly care about what our children are going to have to pay?
Perhaps you’re right. Maybe he has already capitulated. Though the rest of us know enough not to take what he says seriously, he still is a threat to this country, its, liberty, its people and its welfare.
buck@gon
September 19th, 2011
9:39 pm
Littel mind,
“Their plan, and it is in full implementation, marshaling ignorance, fear and blind stupid patriotic jingoism , is to use The Constitution and everything it is supposed to stand for, to bring our experiment in representative democracy to an end. The destruction, castration, or marginalizing, of the real press, the transfer of wealth upward (erasing the middle-class, the ending of fair wages (union busting), and reducing the function of government, by stripping it of functions that serve individuals, to only providing a military, to be used both as a tool to control other nations resources, and as a force to keep the rest of us in line with their desires (using the police power they will control)in a country where “consumer rights” supplant citizens rights, IS ALREADY HAPPENING!”
LoL. We need you Littel. We need you like a plumber needs the stench of crap to remain employed.
Wow Littel, and me, I just thought the government was spending too much money. Funny how you make it all so clear as mud!
And we all have Barry Obama to thank for making the Tea Party politically revolutionary and for allowing us to do all of this by making only one real political point, that out of control government spending is ruining our country, our government and its programs.
buck@gon
September 19th, 2011
9:42 pm
Littel mind,
“The ignorant must be taught, the lazy kicked in the butt, and the pigs doing this (the Koch Brothers, et al, the McConnells, the Boehners) to us, must be exposed for what they are, thrown out of office, and/or prosecuted for their attempted overthrow of The Constitution.”
Marxists like you “care” about the constitution about as much as Barry “cares” about the deficit.
If “lazy” means not voting as you would suggest, then we need a new newspeak, George Orwell style.
Lil' Barry Bailout (Revised Downward)
September 19th, 2011
10:09 pm
Robert Littel: While the public watched their soaps, NASCAR, and the other distractions that have become central focus in the lives of the apolitical citizenry, the share of income taxes paid by the evil rich has steadily increased and half of all Americans have had their share of income tax reduced to zero.
———————–
Fixed.
dixiedemons
September 19th, 2011
10:19 pm
Kyle , you are doing a decent job of stirring the pot of division for fun and profit. Step it up a notch or two and you may well be rewarded with a high paying job with Fox news. Your blog is always entertaining. keep up the good work !!!
Butch Cassidy
September 19th, 2011
10:38 pm
Again, my advice to Obama would be to give in to the Republicans. Let them take responsibiltiy. The sooner they do that, the sooner they can F@#$ it up, and people might actually learn that there is no savior in EITHER party. If nothing else, it would shut up the bleeting from the party faithful for a while.
MarkV
September 19th, 2011
11:01 pm
buck@gon @9:20 pm: “Kyle proved that jobs for schoos aren’t really for the “short run”, …”
WOW! Kyle PROVED something? That must be the first.
“Well, how’s the previous 3 years of Obama showing us what the “short-run” can do?”
How about reversing the contraction of the economy, and creating many jobs?
“OK, put holds on limits, drilling, regulations, needling bureaucrats, mindless paperwork,”
Yeh, that sure will have an effect in the SHORT RUN! Whom are you kidding?
buck@gon @9:27 pm: “Because it was a crappy push poll designed to help the President.”
Interesting, how polls you do not like immediately become “crappy.”
ODD OWL
September 19th, 2011
11:22 pm
Share the wealth, TAX THE RICH, pay down the debt. Congress must increase Fed. Income taxes on wage earners making more then $250,.000 a year in a graduating manner, with a top rate of 50%. Tax capital gain profits as regular income. (50%) Increase the inheritance tax to 40%. Elininate all corporate tax loop holes… End oil and gas subsidies. Enact a corporate alternative minimum tax for Companies that don’t pay any taxes.
STUPID POOR REDNECKS DEFENDING AGAINST THE RICH TAXHIKE
September 20th, 2011
12:20 am
DICK CHENEY SAYS YOU ARE NOT A REAL REPUBLICAN IF YOU DONT MAKE OVER $250,000 A YEAR!
YOU HICKS ARE DEFENDING THE TAXHIKE FOR THE RICH,WHEN THEY NEVER DEFEND YOU POOR HICKS IN YOUR TRAILOR PARKS!
HOW DID THOSE TAXCUTS FOR THE RICH FOR EIGHT YEARS UNDER BUSH WORKOUT?
STUPID POOR REDNECKS DEFENDING AGAINST THE RICH TAXHIKE
September 20th, 2011
12:23 am
THANK GOD BUSH GOT OVER ON YOU REDNECKS FOR 8YEARS!
I THOUGHT THAT THOSE BUSH TAXCUTS WERE SUPPOSE TO CREATE JOBS? NOT
Lil' Barry Bailout (Revised Downward)
September 20th, 2011
5:58 am
HOW DID THOSE TAXCUTS FOR THE RICH FOR EIGHT YEARS UNDER BUSH WORKOUT?
—————————–
Great, thanks for asking. Unemployment was 4-6% and the deficit was a quarter of the Idiot Messiah’s.
Ronnie Raygun
September 20th, 2011
6:51 am
Robert Littel, good accurate post. Too bad it’s like casting pearls before the GOP swine. It just confuses them. Like math.
Uncle Billy
September 20th, 2011
7:04 am
As to the effects of the Bush tax cuts look here; http://economix.blogs.nytimes.com/2011/07/26/are-the-bush-tax-cuts-the-root-of-our-fiscal-problem/
Revenues were lower in 2001, 2002, 2003 and 2004 than they were in 2000. As a percentage of GDP they were lower in every year of Bush’s presidency. And, of course, the collapse came at the end when job losses were running at more than 500,000 per month. For all of 2008 jobs losses were 2.6 million.
Pizzaman
September 20th, 2011
7:07 am
Keep drinking the Kool Aide Kyle. Just how many jobs have been created by the Bush Jr./Obama tax cuts (yes Obama has cut taxes!)? Answer: since Bush/Obama cut taxes the country has lost 15 million jobs. All those “job creators” have taken the jobs over seas or eliminated them and pocketed the tax cuts. Warren Buffet said in addition to the percentage difference that 80% of individuals/corporations making over 250,000/y pay no taxes at all because they’ve moved off shore (see Stanley Tools as an example). So how many jobs with the lowest taxes in the Country’s history? 15 million GONE! Maybe if taxes were eliminated all together we could loose another 20 to 30 million!
Uncle Billy
September 20th, 2011
7:10 am
I should have added that the unemployment rate increased from 4.9% in December 2007 to 7.2% in December of 2008.
GT
September 20th, 2011
7:12 am
We missed the starting point of this recession, the wreck on Wall Street that started this traffic jam in the first place. We bailed out everything that moved except one firm, which to me and many was always curious how that one firm was washed away and others stayed. The government started playing God, who lived who died. Sounds like an Obama move, to his critics, but it was pure Bush. We rewarded failure, because it was too large to fail, except that one firm for some reason. If you are a small individual and raising the future of this country we got your pain, but if you are big like Bank of America the world can’t live without you.
This is what you call an artificial economy. Like an artificial heart if you didn’t have the bail out, the firm would not be there. There was something, and in my mind is something systematically wrong, with what we saved to have failed that dramatically in the first place. But certainly since we saved many of these patients is it too much to ask them to cut their own yard. They may be the only participants of this recession who understand how their lives were made better by the bail outs. And those 30,000 employees being fired by Bank America certainly wonder what could be worse that what they are going though. When the banks and Wall Street can stand on their two feet and get themselves out of problems they created then tell me how this is a class warfare. The government, which till this point is sponsored by the middle class, bailed them out. That same year obscene bonuses were being paid like these VIPs had no obligation to the rest of us. Since then this patched up group has operated like a ghost in these bad economic times.
Chip
September 20th, 2011
7:21 am
Oh well, I look at it this way… my family has plenty of rural acreage that is perfect for farming, and we still remember how to grow and preserve food… and we have the means and the will to defend it. Not to mention a huge supply of firewood. So let Obungle and his merry band of Bolsheviks wreck the economy. WE won’t starve and freeze — the urban liberal fools who voted for him will be the ones to starve and freeze.
Chip
September 20th, 2011
7:22 am
Oh, I see, GT… IT’S ALL GEORGE BUSH’S FAULT!
Riiiiight…
thewindwhistler
September 20th, 2011
7:23 am
The wealthy always find ways to keep their money. They are incredibly inventive. This will not work, taxing the rich. Government has to tax the middle class, they are no way as inventive as the rich. The middle class thinks they are getting away with paying when they have a garage sale, they sell a book for a dime that they paid $10.00 for and think they made out because they are not declaring it.
The one way that will work is for the internal revenue service to trust the tax payer to pay his fair share.
Actually, there are two ways, hire more “Internal Revenue Officers.” The are the only employees of the federal government that makes more for the government than the salary he is paid. Each revenue office brings in 17x his salary in from tax evaders.
theTruth
September 20th, 2011
7:31 am
Congressional Budget Office director Douglas Elmendorf admitted if the super-committee adjourned immediately, and if Congress left Washington for the next ten years—thus letting the tax cuts expire—the deficit would actually be reduced by a far greater amount than anything the super-committee is aiming to achieve.
The Bush tax cuts are the largest current policy driver of the deficit.
pcBobby
September 20th, 2011
7:55 am
Why is it that folk like you, Kyle — call every million/billionaire a “job creator?” I’m with you, Kyle. I don’t like the idea of engaging in so-called “class warfare.” Those who have achieved ought to be rewarded for their hard work and success. Those who were simply handed silver platters, though, ought to be offered incentives to create jobs/contribute to society or pay the higher tax rates to bring down the deficit. Indeed, that would be put a minor dent in the deficit. I agree that spending in all areas needs to be cut-from entitlements through the military. OK, why can’t we zero-in on who the so-called “job creators” currently are and give them the tax breaks/inc Then the rest of the million/billionaires ought to be offered incentives to become “job creators.” If they cannot become “job creators,” then tax them higher and make sure they don’t take their money over to the Caymans.
Really?
September 20th, 2011
8:16 am
Nice cut and paste job (again). Can’t you write something without taking as much as a third of you ‘article’ from another source? This is what high school kids do for term papers. Really!
carlosgvv
September 20th, 2011
8:20 am
Big Business has made it clear for some time now that they have no intention of creating more jobs here but, instead, will outsource as many jobs overseas as possible. They have made it equally clear they have no patriotism and no reguard whatsoever for the American worker. And yet, when Obama asks them to pay their fair share of taxes, their supporters practically began to shed tears at how bad Obama wants to treat those poor Corporations. Only in America would people who will gladly throw their supporters out into the street get such love from those same supporters.
joe
September 20th, 2011
8:24 am
“…….we’re back to spending money on jobs that aren’t ready for shovels.”
Kyle makes a ironically morolicious point here. Too bad his blog today IS ready for the shovel.
bwa
HDB
September 20th, 2011
8:38 am
What too many people fail to realize is when 1% of the populace controls 70% of the nation’s WEALTH, where else can one go to get the revenue for the government to perform its required tasks?? Whn asked why he robbed banks, Willie Suttin said: “That’s where the money is!” We all know that it will take shared sacrifice for the nation to get its fiscal house in order…but the wealthy have yet to be called upon to sacrifice….even though they are the MOST capable to afford it! It’s not class warfare…it IS math!!
Laurie
September 20th, 2011
8:38 am
“And experience teaches us that the wealthy are best positioned to take advantage of a complicated tax code and send Uncle Sam less money than he expected. This is a lose-lose-lose.”
That’s the only line you wrote that I can agree with. The rest is BS.
Road Scholar
September 20th, 2011
8:40 am
Why can’t any new infrastructure project be “Design Build”? Isn’t the private sector more efficient and effective than government? Besides, the private sector will construct them eventually! GDOT’s use of consultants for design is up to about 85% anyway. Yes it will take some time, but we have already wasted 4 years since the beginning of the recession? Do you want to waste more? How are those tax cuts working?
Oh the uncertainty, Oh the whining!
mudfoot
September 20th, 2011
8:45 am
What really detracts from your (and most conservatives) arguments regarding this issue is the fact that these “job creators” have been reaping unprecedented profits and accruing massive wealth for years now, yet they still are not living up to the label you’ve given them and creating jobs… hell they’re eliminating and outsourcing them to maximize profits. Basically, they’re actions (or inactions) over the past few years dilute any credibility your viewpoint contains
itsme
September 20th, 2011
9:03 am
Every day I become more convinced that there is no one in Washington willing or able to lead us out of this economic mess.
From Where I Sit
September 20th, 2011
9:15 am
Barry has DONE NOTHING for AMERICA, except spew his Socialist views!
GET THAT DUMBASS out of The White House!
Enough Said!!!!
mudfoot
September 20th, 2011
9:21 am
“Barry has DONE NOTHING for AMERICA, except spew his Socialist views!
GET THAT DUMBASS out of The White House!
Enough Said!!!!”
Unfortunately no, not enough said unless you’ve already subscribed and committed to far-rightwing propaganda. I’m no Obama fan but there are simple, undeniable truths that many on the right continue to deny:
Conservative policy contributed to today’s poor economic outlook AT LEAST as much as any other factor during the Bush Jr. years
williebkind
September 20th, 2011
9:26 am
Robert Littel
September 19th, 2011
8:54 pm
Be afraid, be very afraid!
williebkind
September 20th, 2011
9:39 am
It really does not make sense to me. How do the progressive whiners justify their claims that the middle class will go away? The rich can only cast one vote. There are few of them. The middle class and below middle class voters are many. So according to the message of the progressive socialists, the poor and middleclass voters will continue voting into office those that will not cater to the needs of the many. These liberal whiners defame the Tea Party members who by the way have put out a notice to office holders that spending has to stop. Obama must go! Liberals should become dinasours! Archeologist should someday dig up a tomb of a liberal and do a History moment of how people wanted the government to completely care for them. Then with a chuckle state, “Thank God there were those who said no to dreaming through life.”
Hmmmmmm
September 20th, 2011
9:41 am
Carlosgvv,
This country has the 2nd highest “cost” for companies to operate in the WORLD… If you were running the company where would you operate? This is all government controlled, and it’s not just a repub/democrat problem… Both parties have caused this problem…