As promised, Barack Obama unveiled his administration’s new deficit reduction plan this afternoon, in the White House rose garden. [Those who want the facts can find an outline of the plan on the White House website. A PDF of the entire proposal can be found there as well.] From what I can tell, it marks a fairly significant turn away from the “grand bargain” that Obama offered Republicans several weeks ago. While retaining some of the same elements, the cuts to so-called entitlement programs don’t appear as deep, and, for a change, Obama seems to be serious about including revenue increases alongside cuts, even going so far as to say that he’d veto any bill that comes across his desk that doesn’t include them. The following overview comes from The Atlantic:
President Obama on Monday called for a combination of spending cuts and $1.5 trillion in new tax revenue increases that would save $3 trillion over the next decade. And he will warn Congress that if they do not give him a “balanced” package that includes tax increases for the wealthiest Americans, he will use his veto and make them start again.
“We can’t just cut our way out of this hole,” Obama said.
Slightly more than half of the $1.5 trillion attributed to tax reform — $800 billion — would come from letting the Bush tax cuts for the wealthiest Americans expire. The other $700 billion, the officials said, would come from other changes in tax law. Many of those measures, they acknowledged, will look very familiar because they have previously been proposed by Obama. Those would include limiting deductions for those making more than $250,000, ending tax preferences for owners of corporate jets, and ending oil and gas preferences. They said roughly $300 billion of the $700 billion would come from closing loopholes…
And the response from the Republicans, who would much rather avoid taxing their wealthy campaign donors, while slashing programs like Medicare and Medicaid to the bone, has been predictably hyperbolic. The following clip comes from the New York Times:
…“Veto threats, a massive tax hike, phantom savings and punting on entitlement reform is not a recipe for economic or job growth — or even meaningful deficit reduction,” said Senator Mitch McConnell of Kentucky, the minority leader. “The good news is that the joint committee is taking this issue far more seriously than the White House.”
Mr. Boehner said, “This administration’s insistence on raising taxes on job creators and its reluctance to take the steps necessary to strengthen our entitlement programs are the reasons the president and I were not able to reach an agreement previously, and it is evident today that these barriers remain”…
By “strengthen our entitlement programs,” Boehner means to defund them, but I guess you knew that.
And that was just the tip of the iceberg. Wisconsin Congressman Paul Ryan, who would prefer to balance the budget on the backs of working men and women, accused the President of class warfare. “Class warfare,” said Ryan, “will simply divide this country more, will attack job creators, divide people, and it doesn’t grow the economy.” Others echoed the sentiment, making the unsubstantiated claim that ending the Bush tax cuts would kill small business. My favorite Republican argument against shared sacrifice by the rich came from Florida Congressman John Fleming, who said that, without the Bush tax cuts, he’d have to make ends meet with only $400,000 a year, after feeding his family… I’m sure that’s going to resonate with the unemployed of America.
I get tired of saying it, but I think it’s worth restating that the Bush tax cuts were never meant to be permanent. They were passed ten years ago, as the nation slid into recession, with the promise that they would lead to jobs. Those jobs, as we know now, never came. (Record profits came – that’s true – but the jobs never followed.) But, in spite of that, we decided to extend them beyond their agreed to sunset date. And, now, as the deficit continues to swell as a result, we find ourselves teetering on brink of collapse. The President didn’t use those exact words, but he said as much today. “We can’t afford these special lower rates for the wealthy — rates, by the way, that were meant to be temporary,” said Obama. “We can’t afford them when we’re running these big deficits.”
And, with that, it seems as though progressive Democrats are gathering once more in support of Obama. The following comes from the Washington Monthly:
…Given what we’ve seen this year, it’s been tough to know what to expect from the White House when it comes to major policy showdowns with congressional Republicans. As recently as July, President Obama, seemingly desperate to strike a “Grand Bargain” with House Speaker John Boehner (R-Ohio), was willing to give away the store. Fortunately, the GOP refused to accept it…
Going into this morning’s speech on debt reduction, we saw a very similar dynamic, with fears that the Obama plan would cut Social Security and raise the Medicare eligibility age. And again, the president exceeded expectations…
Given the larger political circumstances, it’s unlikely the president’s proposal will enjoy much support in the right-wing House, making this more of an opening salvo than a realistic legislative blueprint. But in some respects, that’s the most heartening part of the recent White House shift — Obama and his team aren’t playing by the same rules anymore. Indeed, they appear to have thrown out the old playbook altogether…
Of course, some are questioning Obama’s motives. This could, after all, just be a cynical political on his part. Knowing that this plan will never pass the House, he could merely be trying to force Republicans to say on the record, as we head into election season, that they’d rather allow social programs to collapse and the deficit to spiral out of control, than see their precious tax cuts come to an end. Some, like New York’s Chuck Schumer, however, seem to think that there may be a chance of actually passing it, though. Schumer’s suggesting that the so-called Buffet Rule be brought to a vote as soon as possible. The following comes Sam Stein at the Huffington Post:
…”This is a game changer in the tax debate,” Schumer said during a conference call on Monday. “It will make the Republican position almost indefensible. The president has a winning hand, and he is going all in. And I believe Democrats will be behind him. … Just about every Democrat will be behind him.”
Later in the conference call, Schumer said he would like to see the Buffett rule actually drafted into legislative language, scored for budget effect and put to a vote. Considering that the Democratic Party lacks the Senate members to overcome a filibuster or, in all likelihood, the discipline to secure all the Democratic votes, that seems far-fetched, although Schumer urged the president to barnstorm the country to whip up support.
“I find it very useful to make some proposal along the line that fits within the confines of the Buffett rule and put it on the floor… Once the president goes around the country and keeps talking about it, as I believe he will do, we are going to win this fight,” Schumer said…
So, it all comes down to how well the President makes the case to the American people… and the campaign began in earnest today.
“Middle-class families shouldn’t pay higher taxes than millionaires and billionaires,” said Obama. “This is not class warfare,” he said. “It’s math.”
Now I guess we’ll just have to wait and see whether the American people respond to math as well as they do to demagoguery.
I have my doubts.
30 Comments
Mark Cuban, Dallas Mavericks Owner:
The most patriotic thing a rich person can do is “pay lots of taxes”.
http://www.huffingtonpost.com/2011/09/19/mark-cuban-taxes-buffett-rule-obama_n_970266.html?ncid=edlinkusaolp00000009
Sam Stein has another piece, in addition to the one linked to above. Here’s the whole thing.
As someone who frequently has been critical of the President, on both on policy and strategic grounds, I have to admit that I am cautiously optimistic:
Optimistic- because I like the new focus on revenue (letting the Bush tax cuts on the wealthy expire, a proposed surtax on millionaires; and his new, more determined tone (an actual veto threat).
Cautious- because I have too frequently seen this President’s resolve melt away in the face of Republican stonewalling.
Mark, can you use you blogging powers start the ball rolling on renaming “entitlement” programs something else? Like “earned benefit” programs? Entitlement evokes spoiled brats demanding something they don’t deserve. I’m sure this was intentional by the right. Rename them or at least just use “medicare and social security”.
Love what I’m hearing, but doubt that it will last. This quote from the Stein piece in particular concerns me.
$3 in new tax increases for every dollar in additional spending cuts. Much of the reductions are ten years out. He still doesn’t get it. Same old tax and spend. He’s not even slowing the rate of spending. Smoke and mirrors. Time for Real Change.
Allowing the irresponsible and TEMPORARY Bush tax cuts to expire is not the same as a “tax increase”, EOS.
One great side effect of this new legislation if it passes:
Bill O’Reilly Threatens To Quit If Higher Taxes For Millionaires Are Enacted
http://www.newshounds.us/2011/09/20/bill_oreilly_threatens_to_quit_if_higher_taxes_for_millionaires_are_enacted.php
See also, the Jimmy Buffet Rule.
http://www.foxnews.com/opinion/2011/09/19/jimmy-buffett-rule/#content
I question the decision to base his appeal to the American people on something as controversial as math. This isn’t the 50’s.
Should America tax the rich?
“Working people are taxed between 28 to 35% federal income tax.
People who do not work and have investment capital (unearned income) are taxed at a 15% rate from these investments.
Remember: The money used to buy these investments has already been taxed at 28 to 35% and will again be taxed at 15% when it is re-invested and there is a return on the investment. Think of it as buying a used car. It has been taxed when bought new and is again taxed when it is sold as used and continues to be taxed when re-sold everytime.
If everyone wants “the rich” to pay more in taxes on unearned income, consider this.
1. Raising the tax rate on un-earned income from 15 to 25% or higher will place the stock market and investments “at risk” since possible investors might not want to invest at these new higher rates because of the return they would receive on their investments.
2. By taking this route and raising capital gains rates (15 to 25%) will place retired seniors and their 401k’s at risk again. This is money they live off of in their retirement years. There could be “less investment” in the stock, mutual fund markets because of less returns on these investments.
Question: Are we willing to do this? People/taxpayers/retirees built their retirement years around their 401k’s. Your call !
As for the “Buffett Tax Plan” that Barack Obama is pushing. Buffett is entitled to pay himself a salary from his investments instead of “just receiving” these unearned income monies. But he won’t do this! Why? He wants to ONLY pay the 15% rate to the government instead of the 28 to 35% rates if he drew a salary. Oh the sounds of a hypocrite one can say!
………..and then we have this hidden in the Barack Obama BS Bill that has taken 3 years to hit the floor………next week! Maybe? Or a month from now? I guess libs got alot of extra cash for this $130Billion!
http://weaselzippers.us/2011/09/19/ap-its-not-just-millionaires-whod-pay-more-under-obamas-jobs-plan-ordinary-american-hit-with-130-billion-in-new-govt-fees/
Nice Title.
When this bill passes, taxes will still be lower than they were under Reagan. When Eisenhower was President, the wealthy were taxed at 90%. You have no idea how stupid you sound when you keep going on about how we can’t tax the rich more than we’re doing right now. Do you remember the economy in the 50s? In the 80s? Were those periods of growth, or depression? You are laughably ill-informed.
anonymous,
The top marginal rate under Eisenhower was for people that had an income of over $2.5 million dollars in today’s money.
Now days, Obama says we are rich if we make $200k.
50’s and early 80’s…………401K’s were just getting started in the 80’s as a form of retirement. Link the two and then talk some more!
Eel……here’s your Jimmy Buffett: http://ireport.cnn.com/docs/DOC-211744
Barack Obama’s “New Jobs Bill” has a few “hidden items” of grave concern. Remember when he said that the bill is “All or Nothing”? Here is the reason behind that statement. You won’t believe this one. There is NO company who is even going to consider hiring, much less to have an employee vs. employer interview now. It is almost like Obama doesn’t want the the country to create jobs. Either Obama is dumb as a stump and set in his ideology or he is so deeply intrenched in Saul Alinsky’s radical views on how to bring a country to its knees inorder to usher in a new type of government……..socialism/New World Order.
http://weaselzippers.us/2011/09/13/obamas-job-bill-will-make-the-unemployed-a-protected-class-allows-job-seekers-to-sue-for-discrimination/
…………..and then we have this written in the Jobs Bill:
Stimulus II, Barack Obama’s “new” and improved (so he says) economic stimulus package (not yet presented to Congress) has a section 261 of the bill that grants portions of $15 Billion dollars to qualified non-profit organizations………ala……..Acorn. And we all thought “Slick Willy” had retired!
http://vpatriotupdate.com/12253/obamas-jobs-bill-makes-acorn-eligible-for-15-billion-in-taxpayer-money
This past week, Barack Obama gave $300,000.00 to Acorn affiliates: http://weaselzippers.us/2011/09/16/report-acorn-affiliated-group-gets-300000-more-in-taxpayer-money/
Deliberate Improverishment of the Western World. Agenda 21, BaracK Obama and the New World Order all come into play:
http://www.rightsidenews.com/2011091414494/us/politics-and-economics/deliberate-impoverishment-of-the-western-world.html
Did you read this part?
http://biggovernment.com/capitolconfidential/2011/09/20/dems-pursue-tax-hike-on-the-poor/
Obama’s deficit reduction plan?? How about a deficit jobs in the USA plan! Where’s Nancy Pelosi, Brad Sherman and Barbara Boxer who live in this state?
http://www.bizjournals.com/sanfrancisco/morning_call/2011/06/bay-bridge-being-finished-in-china.html
America’s (at this time) Hypocrite-in-Chief at his finest moment:
http://moonbattery.com/?p=2446
This what the left wing loons like Brain-less look up to! A hyocrite who will tell them one thing and then do another after he gets what he wants. Have you ever heard of “Bait & Switch” ?
You guys are starting to irritate me.
You’ll find all of the historical data on tax rates here. You can have someone read it to you.
http://en.wikipedia.org/wiki/Income_tax_in_the_United_States
In 1950 the Federal tax rate on those making over $100,000 a year was 89%. Those making over $200,000 paid 91%.
In 1980, those numbers were 59% and 70% respectively.
In 2010, they were 25% and 33%.
The facts don’t lie.
And what to 401Ks have to do with taxes?
Annonymous………this is why you are lost on this issue. Think taxes when acquiring revenues from working (earned) or revenues from not working (unearned-401k’s). One makes you pay 28-35% while capital gains makes you pay 15%. Now if your return on you already taxed revenues are invested into a 401k and you live off the interest, you are taxed again at 15%. Raise this rate and citizens on retirement means probably will NOT go this route because their would be no reason. We can even take it farther but you might get lost.
Hypocrite “Extraordinair”…….The Master at work while the liberal base gets on their knees and prays to this communist.
http://weaselzippers.us/2011/09/20/surprise-obama-doesnt-mention-tax-hikes-on-rich-at-38500-per-person-fundraiser/
Unfortunately, our Republican members of the House are every bit as shitty as we feared.
Tater Salad, learn how 401ks work, and there tax consequences. Your LaRouche misinformation is tire some. http://en.wikipedia.org/wiki/401K
Why would Tater know anything about 401k’s? He doesn’t need one.
The US Government happily provides for everything he could ever want, from health care to the money he spends at Buffalo Wild Wings to support his expanding figure.
Barack Obama is NOT incharge as you left wing moonbats all think:
Source: EU Times
http://www.eutimes.net/2011/09/europe-stunned-after-being-told-obama-is-not-in-charge/
—————
Europe Stunned After Being Told “Obama Is Not In Charge”
A new report prepared by Russian Deputy Finance MinisterTatyana Nesterenko about the Eurogroup meeting of the Informal Economic and Financial Affairs Council (ECOFIN) in Wroclaw Poland on the growing European debt crisisstates that EU Finance Ministers were “left stunned” Friday after they were told by US Treasury Secretary Timothy Geithner [photo top right] that President Obama was “not in charge.”
According to this report, the “uninvited” US Treasury Secretary showed up at the ECOFIN conference and engaged in what can only be described as a “temper tantrum” where he slammed Europe’s economic policy makers for their intransigence in provided further bailouts to Greece and when queried by European Central Bank (ECB) Chief Jean-Claude Trichet as to if this was “Obama’s position too” was told by Geithner, “He’s (Obama) not in charge, I am.”
ECB Chief Trichet, according to other news reports, rebuked Geithner and stated that the financial position of the 17-member Eurozone is better than that of other major economies, especially the United States.
This shocking revelation as to who is actually running the United States comes on the heals of further allegations that Geithner deliberately ignored Obama’s orders to prepare a plan to “wind down” the mammoth international banking group Citigroup Inc. in order to help save the American economy, and as we can, in part, read asreported by the San Francisco Chronicle:
“U.S. Treasury Secretary Timothy F. Geithner ignored an order in 2009 from President Barack Obama to prepare a plan to “wind down” Citigroup Inc., once the biggest bank in the world, according to a book to be released next week.
http://www.truthwinds.com/siterun_data/government/obama_government/news.php?q=1316280307
The Agenda to bring America to its knees. It is being done by the Obama adminstration as we speak.
http://www.youtube.com/watch?v=xQf_QfitmKE