Monday, September 19, 2011

Obama outlines plan for cutting deficit, raising taxes

 President Obama today made good on his promise to address the nation's fiscal woes and pay for his "jobs plan" first revealed in a joint address to Congress Sept. 8, 2011 with a plan to cut the nation's burgeoning budget deficit by three trillion dollars over the next ten years.

 The plan also forms the basis of his suggestions to the Congressional "Super committee" established as a part of the "budget compromise" hashed out over the summer between Republicans and the White House at the last minute in order to avoid a government shut down.

 But the long awaited plan seems to be a case of much ado about nothing, at least to us.

 As Republicans were quick to point out, the plan is half paid for by tax increases on the "rich," something which Obama himself once stated would harm the already weak economy, (see here), and does nothing to systematically reform entitlements, which threaten to consume the entire federal budget within 20 years, (in spite of Obama hinting at such systemic reforms over the summer).

 Republicans however weren't the only ones to criticize Obama's deficit-cutting plan. 

 Hillary Clinton's prior campaign manager for her 2008 Presidential bid, Mark Penn, said in an article for the liberal Huffington Post, 

He (Obama) should be working as a president, not a candidate... He should be holding down taxes rather than raising them.  He should be mastering the global economy, not running away from it.   And most of all, he should be bringing the country together rather than dividing it through class warfare." (for full article click here).

  Leaving aside for now the obvious, that it is only the "rich" who can afford to open factories and hire others, (after all, one rarely gets hired by a poor man!), and the other erroneous views of Mr. Penn that cutting government spending will result in a loss of jobs, (when in fact government spending crowds out private enterprise which is the only real engine of job growth in our system), the President's plan follows a consistent "us vs. them" theme that has emanated from the White House as a steady drumbeat of speeches promising to make the "rich" pay their "fair share" of taxes, (always a popular stump topic intended to buoy the President's support among his Democrat-left base ahead of the 2012 elections).

  And what of the fact that according to the IRS the top 10% of income earners already pay approximately 70% of all income taxes, (see here and click on table two for tax year 2008), while fully half of the citizenry pay absolutely no income taxes (while simultaneously drawing from our national "safety net?")  

  Or that the top 1%, (you know, those greedy millionaires and billionaires the President likes to talk about making pay their "fair share"), pay 38% of all income taxes? Details, smetails!  Now why do you have to go messing up perfect presidential re-election politics with the facts?

  Meanwhile, ideas like Rep. Paul Ryan's doa budget and attempts at entitlement reform, or replacing the IRS with a truly flat, fair tax national sales tax which would shutter one of the most feared and invasive government bureaucracies in our nation, capture "black market" underground income and end the loopholes that have allowed international conglomerates like General Electric-- headed by the way by Jeffrey Immelt, a known democratic supporter of Obama's-- to avoid paying any U.S. taxes at all last year on profits over 14 billion, languish on the vine without any support from the White House.

 Don't get us wrong, we are happy the President has finally weighed in on the subject of deficit reduction, (even if coming late to the party), as in doing so he is at least publicly acknowledging the importance of tackling our nation's dire fiscal woes. 

 Perhaps such gestures are merely the beginning of a process that will result in a much-needed public conversation and eventual compromise with the Republican Congress that will result in real and substantive reform sufficient to save our nation from impending economic ruin.   We can only hope.  jp  

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