By John D. McKinnon
In downplaying the possibility of a deal extending Bush-era income-tax rates for high-income households, Mr. Obama engages in a bit of budget gymnastics. It’s worth explaining further.
At his news conference, Mr. Obama said it’s difficult to see how you make up the cost of extending the top Bush-era tax rates just by closing loopholes and deductions, as Republicans would like to do. “The math doesn’t work,” he says, echoing Treasury Secretary Tim Geithner’s comments on Tuesday.
But Mr. Obama is defining rate breaks somewhat broadly to reach the $1 trillion figure he uses as the cost of extending the top tax rates.
“The math doesn’t work,” he says, echoing Treasury Secretary Tim Geithner. . .
This coming from a man who cannot even figure out TurboTax and do his own taxes but he is the head of IRS!
We have been told for over a decade that those nasty Bush Tax Cuts only benefited the rich. When will learn to listen? Perhaps it is time to take the democrats at their word and just let them expire.
Look, Obama negotiates like a old-school Soviet. 1) refuse to negotiate 2) demand a pre-negotiation concession 3) start negotiation from the most absurd position possible 4) demand another concession to keep the talks alive 5) make a slight concession as part of a last and final offer 6) Sign the deal 7) break the deal 8) rinse and repeat. He only knows how to construct win-lose deals, and we have offered tax increases for promised budget cuts before, and we are still waiting.
He is at phase 2, demanding tax increases for the rich as a precondition to budget talks. Once we agree to this, we have nothing left to negotiate with. If the tax cuts expire, he will be forced to offer some earnest budget cuts to get back his tax reduction for the middle class back.
Yes, it is ugly. But the alternative is higher taxes AND out of control spending.
It has been proven time and time again that lowering tax rates increases taxable revenue and raising tax rates decreases tax revenue, and always by amounts far larger than the government projects.
@Michael, it’s not about losing money directly, many will not lose much of anything as they already pay more than the highest rate thanks to AMT, but for those that will pay more in tax, it will be the usual Democrat approach of taxing those that are good at producing wealth and pass it through those with a proven record of squandering wealth, and with the little money that trickles to those who have no wealth, make them dependent on that trickle. Every country that has used increased tax rates to balance the budget have seen recessions and no revenue from the higher taxes. Check out the temporary 50% bonus tax in Britain: no extra revenue. The same will happen here, though for different reasons. If the objective is revenue rather than punishment for success, a tax reform and a growing economy are the answers.
@Michael
Stock went down the day Obama was re-elected. Get a grip.
Blame Europe, blame Bush do not work anymore.