Flower

Debating the Tax Deal — Cutting Through the Fog

Fog

Fog

If you care to cut through all the fog about the tentative agreement to not raise taxes, here are a few pertinent facts and my thoughts.

Remember, their “how-to” manual (Rules for Radicals by Saul Alinsky) tells Progressives that the ends justify the means. One of his moral authorities is Vladimir Lenin, killer of millions. Lying, cheating, stealing, etc. is OK if it helps you take money away from the “haves” and give it to the “have-nots.” Laws and moral norms (don’t lie, don’t cheat, don’t steal, etc.) are legal and moral constructs which have been created by the “haves” to keep wealth away from the “have-nots.”

For nearly 10 years, the Dems have claimed that the 2001/2003 tax cuts did nothing for the low-income and middle class. That’s a lie:

  1. These cuts lowered the bottom tax bracket from 15% to 10 %, a 5% decrease. Most other rates were decreased by 3%. The highest rate was reduced 4.6%, from 39.6% to 35%.
  2. A tax credit was given for each child under age 17 or so.
  3. The estate tax was eliminated.
  4. Now, after nearly 10 years of denying that tax cuts for middle class families even existed in this bill, the Dems have suddenly “found” the middle class tax breaks and are now declaring that these lower rates must now be preserved.

The latest sticking point is ostensibly the tax rates for those making over $1,000,000 or so. The Republicans wanted to keep it at 35%. The Alinsky-ites want it to go up to the Clinton-era rate of 39.6%. Actually, they want the tax rates to go up on everybody, but they don’t want you to know this.

The 5% rate difference may not seem all that important by itself, but it’s just the first wave. The Alinsky-ites will never be satisfied with 39.6%. As soon as that rate is established, the 39.6% will become the new baseline and they will want even more. They will demand another 10%, and we will all be admonished to accept another “compromise,” which will become the new baseline for the next “compromise,” and so on. Middle class families will not be exempt. Dems/Alinsky-ites believe it’s not fair that we have more money than the very poorest of our families, so they will come after us as well. The Dem/Alinsky-ite greed for money and power never ends. After all, it takes a lot of money to keep ’em happy at Planned Parenthood, ACORN, the unions, etc. There’s a reason Government is the only growth industry in our economy.

There’s another reason they want more of your money.  There are millions of abortions done every year around the world that are not paid for by the American taxpayer.  This is in injustice that simply must be corrected.

Postponing the Dem/Alinsky-ite tax increase for two years won’t do much for the economy. The planning horizon for business is much further than that, and investors need to know what the tax rates will be 10+ years out.

When the tax cuts were first enacted in 2001/2003, they helped stimulate the economy because investers know that the lower rates would stay in place until the end of 2010, and there was every expectation that they would be made permanent after that. The good effects of this tax cut on the economy, as realized in the mid-2000’s, were overwhelmed in 2007-2008 by the perfect economic storm:

  • rising personal and business debt,
  • the spike in world oil prices,
  • the bursting of the government-created housing bubble,
  • the expectation that deficit spending, already too high under Pres. Bush, would destabilize the economy in the long-run, and
  • the fear that a new anti-business administration would destabilize the economy even worse and more quickly.

The only good thing about the 2-year extension is that it just postpones the real debate for another 2 years down the road, just in time for the next election cycle.

With regard to extending jobless benefits, I’m not sure what they actually have agreed to. Even with the internet, it can still be difficult to find facts that you can read and understand.

2 Responses to “Debating the Tax Deal — Cutting Through the Fog”

  1. December 8th, 2010 at 2:15 pm

    Katherine says:

    Obama sneaked some things through, like that lovely 35% inheritance tax. Giving our children our hard-earned American money is yet another way for the government to fund its largess. The Democrats cry foul about the national debt: I doubt one penny of the extra money would actually GO to the national debt if they did get the increase. Politicians love spending our money on humanitarian efforts of their choice (as if it’s not our freedom to give as we see fit too?) As for economics, the experts say that they can’t remove the tax break or it’ll harm the number one economic stimulator: the employers. So Obama will preen himself with the nice economy in two years, and get reelected, while blaming Republicans for an “illogical tax break:.

  2. December 9th, 2010 at 6:09 pm

    On tax deal, Wall Street Journal follows FAB says:

    […] the agreement to extend the current tax rates for 2 years, FAB wrote: The only good thing about the 2-year extension is that it just postpones the real debate for […]

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