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  • Morning Bell: Growth vs. Redistribution

    During last night’s presidential debate in Hempstead, N.Y., Barack Obama said, “I think tax policy is a major difference between Senator McCain and myself. And we both want to cut taxes, the difference is who we want to cut taxes for.” Obama is half right here. As Obama adviser Austan Goolsbee admitted this summer, Obama and McCain both want to preserve the vast majority of President Bush’s tax cuts. The difference between Obama and McCain on taxes is that where the two do propose minor changes, Obama wants to use the tax code to redistribute wealth while McCain wants to use the tax code to create it.

    The Bush tax cuts Obama and McCain want to preserve include lower tax rates for most income brackets, an increase in the child tax credit, and a reduction of the marriage penalty. Both candidates also want to limit but not repeal the Alternative Minimum Tax and both have voiced intentions to lower the death tax. These are all positive developments. Unfortunately, both candidates also propose to further complicate an already hopelessly complicated tax code.

    For all their similarities, the two plans have important distinctions. The most important is that McCain’s tax proposals emphasize job creation and raising wages. Obama’s tax proposals exemplify his view that redistributing income among citizens is more important than increasing their earnings and creating jobs. This view is apparent in his proposal to raise income taxes dramatically on individuals and small businesses earning more than $250,000.

    Defending his plan in Toledo, Ohio, on Sunday, Obama said, “My attitude is that if the economy’s good for folks from the bottom up, it’s gonna be good for everybody. I think when you spread the wealth around, it’s good for everybody.” Unfortunately, the facts do not back up Obama’s claim. Using tax models and tax information from other sources as inputs into Global Insight’s U.S. Macroeconomic Model, Heritage’s Center for Data Analysis just released a study estimating the side-by-side economic effects of the two plans. According to CDA, by 2018 the economy would be more than $320 billion larger (after inflation), and average household income would be more than $2,600 greater under the McCain plan than under the Obama plan.

    Americans understand that redistributing income among citizens impedes income growth and job creation. The same “Joe the Plumber” who questioned Obama in Toledo on Sunday, and was mentioned again in last night’s debate, told The New York Times:

    [Obama's] answer actually scared me even more. He said he wants to distribute wealth. And I mean, I’m not trying to make statements here, but, I mean, that’s kind of a socialist viewpoint. You know, I work for that. You know, it’s my discretion who I want to give my money to; it’s not for the government decide that I make a little too much and so I need to share it with other people. That’s not the American Dream.

    For all the talk from liberals about how the recent financial crisis proves that capitalism is dead, Joe the Plumber proves just how wrong they are. Americans still believe in the American Dream and they instinctively understand that lower taxes enable the economic growth that makes that dream a reality.

    Quick Hits:

    Posted in Ongoing Priorities [slideshow_deploy]

    14 Responses to Morning Bell: Growth vs. Redistribution

    1. RG Robins, American says:

      Joe the quarter-million-dollar plumber? Give me a break. My eyes are dry from crying over you. And all those persecuted rich people who may have to pay more taxes. Boo hoo. The poor are always getting more than their fair share, right? The rich are rich because they earned it, right? Well, except for those who inherited it, or those who swindled and conned it, or those who lucked into it, or those who "earned" it in the underground economy, or those who stabbed others in the back to get it, but anyway, at least those honest, hardworking rich people earned it, right?

      If you let the rich have more, they'll work harder. If you give more to the poor, they'll quit working.

      Did anyone ever think that maybe the poor would respond to incentives, too? Maybe if they had the prospect of a real living wage, more folks on welfare would get a job.

      And let's think about incentivizing the rich. If a CEO is making $500,000 a year, he must be working pretty hard already. How much harder can he work? Will he really work that much harder for an extra $500K than he would for an extra $250K? And is money the only reason he would work harder? What about pride? Duty? Moral character? Love for his job or for those who depend on him? The desire to help others or serve humanity or please his Maker?

      I say, "to whom much is given, much is required." An honest person can only get rich in this country because he/she lives in a wealthy society with a good infrastructure that supports the condition for the possibility to generate wealth, as for example consumers who have money to spend and educated people to employ and create the high-tech civilized world we want to live in.

      So, Joe the 1/4 million dollar plumber, quit crying, pay your taxes, and shut up.

    2. Bill Meade Virginia says:

      All, I love John McCain, but he is no match politically for this machine of Obamas. If you asked most Americans if they favored Pelosi and Reid having unchecked power to drive the direction of this country. You would get a huge perecntage of Nos. Yet they disconnect their vote for Obama from facilitating that very thing. This is a clash of unchecked extremism vs conservative centrist leadership.

      We have another choice, one that allows us all to come through this together, grounded through even the worst of storms by the tenants of our Democracy in tact. Rejecting massive government control, making business the enemy, and class warfare weath redistribution.

      We can emerge from this stronger and with a collective story of courage through crisis our generation will be proud to tell our kids.

      I will admit, I freted and angst over these last three weeks, posting and hoping to somehow let my voice join enough others to effect the message of the debates.

      They are over now. This is a plea for organization of the like minded. The RNC contacts me daily, but only for $$. My gut tells me millions share this feeling, but are frustrated how to voice it in a substantial enough way to at least let voters come to the polls with open eyes for the radical changes they will be unknowingly endorsing.

      Are there such groups organized, how can I particpate, share, and co ordinate.

    3. Independent in FL says:

      It was sickening to watch Obama constantly laughing-off serious questions that McCain raised. Does Obama really understand how serious this job is, and just how dangerous this world has become? He just doesn't seem to get it.

    4. Michael J O'Bri says:

      Bravo for Joe the Plumber and those that would like to be like him. We have seen the results of income distribution and socialism in Eastern Europe that RG Robins above so proudly embraces. When the Iron Curtain fell in 1989, the West was not prepared for the poverty and despair that socialism or income distribution so effectively created in eastern Europe. Most eastern European countries will be recovering for the next 50 years.

      I have seen first hand the effects of socialism / communism and income redistribution on people’s lives in Romania, having family there and visiting four times. I have seen pictures of people standing in line at 5 a.m. at a food store in Bucharest, just to see what food was available, and it was usually just a can or two. After FDR carved up Eastern Europe, Romania went to the Russian, homes were then taken from families and given to others so everyone could have a home. Families were not allowed to own more than one home, and the state controlled all finances. The international court [in Germany] is now attempting to repatriate homes with the original owners / families. The national palace was taken from the people and used as Ceausescu’s and the Securitate’s’ private hunting lodge.

      My wife was born in Romania and she tells me stories such as: after 9:00 p.m. as a child she would study by candlelight since there was no electricity in the town, the communist could not afford it. Everyone was poor; wages were determined by the state. The older generation still has the sense that they cannot better their lives without leaving the country. And indeed, the population of Romania has gone from approximately 26 million to less than 23 million in the last 4 years. My wife is a physician and she was fortunate to get a decent education and leave. Many are not and continue to suffer. Wages in Romania are low, the country has a poor infrastructure, and living conditions are difficult. The lesson is this: Socialism or communism [income redistribution] will never provide anyone with wealth or economic freedom; it creates despair and poverty and is a failed economic model. Romania is enjoying its freedom and moving to a free market system with individual rights and private ownership, on the other hand the U.S. is moving towards income redistribution and will suffer long tern consequences. Mr. Robins, you should have more facts than opinions about the effects of socialist programs and income distribution before embracing such a failed economic model. As Winston Churchill once eloquently said: “Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery”.

    5. Jack Kyle, Lubbock,T says:

      What’s The Difference Among

      Jessie James

      Bonnie & Clyde

      John Dillinger

      And Barack Obama???

      The answer is – only the time in which they lived.

      Obama in his own words believes in “Redistributing the wealth”.

      Jessie James, Bonnie & Clyde and John Dillinger believed in redistributing the wealth. They all believed that they were right and justified in taking money from people that had worked for their money and spending it on whom or what they thought was important.

      Obama believes that he and the democrat party knows how to spend your money better than you do. Obama and the democrats believe that if you have been successful and have been able to make more money than you have spent, you must have cheated someone.

      There is absolutely no difference between taking your money at the point of a gun on the street, and taking it through taxes, with the understanding that if you don’t pay they will send federal agents to your house with a gun to take you to jail. The government will take what you have worked for through the court system and call it legal.

      Wake up, America! The government under Obama will be coming after your hard-earned money as fast and as hard as it can. There are more people getting money from the government, you and me, than are paying into the system. This means that those who do not work can vote to take what you and I have worked for.

    6. Pingback: Morning Bell: Growth vs. Redistribution - Jason’s Blog

    7. Ann Pullman, Weeki W says:

      Regarding Obama's redistribution of wealth:

      This is a very negative philosopathy because it is in essence saying, don't bother to be an achiever, or the best that you can be, because it will be taken away from you, if you achieve your potential. That's like telling our young people to be underachievers.

    8. Pingback: Shopfloor » Blog Archive » In the Battle of Economic Common Sense, EU vs. California

    9. Larry Harasansky says:

      I agree with Pullman…the idea of conservatisim is to preserve the highest ideals of American Freedom. For everyone to achieve their highest potential thru free enterprise.As Pullman said to be the best you can be. Ronald Reagan once said,"Let's get the government out of peoples lives" Further President Reagan said…."The nine worst words in the English language are..I'm from the government and I'm here to help".Please!!!

    10. Barb- st. paul says:

      He is a man of deception and will continue to cover-up or give in if it furthers his cause. He says nothing on "FREEDOM" as he continues necessary efforts to destroy the ability. He has no faith in the American people as he says nothing on equal opportunity while he blocks the doors to convince people only he can save them. He stands to convince people the only jobs needed are more unnecessary, costly government jobs as he refuses to take the steps to allow the people to create jobs for the people. He doesn't believe in power to the people he believes in power to the government. His senate seat was probably a result of his voter fraud scheme as he achieved nothing but holds his hand out to collect the pay he doesn't deserve.

      Defamation of America is unacceptable. Defamation of the American people is unacceptable. Stealing the ideas of someone else to give you credit is unacceptable. Extortion of tax payers money is unacceptable.

      What you, Obama, call "personal attacks", are PERSONAL TRUTHS. Thank God for the human strength & courage of others to bring out SOME of the truth. An honest man has NOTHING to hide Obama! You seem to have plenty!! Nobody needs you to open the door of opportunity to your mindless government jobs. You may be genuine to your cause, Obama, but you are disingenuous to American principles, values and way. Everything American. You portray people of various nationalities in America as weak and or needy! You motivate resentment, not unity. You are discreetly removing true Christian faith along with civil law. You reward irresponsible people at the cost of the responsible. You refuse to acknowledge that many people of many nationalities accept each other as you can't bring yourself to do the same as your racist theology dictates.

      It was comforting for you to say you will give up more of your pay to those you see as too weak to live an American dream at their own pace. It would be deserving to the American people, for all government officials that carry the democratic title to have their wages cut or removed from governing in america as all are corrupting this country of FREEDOM! GET OUT OF THE WAY, OBAMA. THERE'S EQUAL OPPORTUNITY FOR EVERY HUMAN LIFE WHICH EVERY HUMAN LIFE IN AMERICA, HAS THE CHANCE WITHOUT GOVERNMENT DEPENDENCY, TO DO FOR THEMSELVES!

      One more thing…PUBLIC schools should only be allowed to teach FACTS. Obama wants to indoctrinate, at the cost of taxpayers, 3 years old and up throughout college. He wants children to learn "sex education" in kindergarten! Hmm, I wonder why?????? Sounds like another set-up. Because of our nation of various beliefs and excuses, anything outside of teaching FACTS should be at the cost of those that want it. People that pay their own way make more responsible decisions. Those that don't, TAKE ADVANTAGE. Obama, You, your wife, the people that back you, don't let people figure things out for themselves as you don't WANT them too! That would take too much away from your imperial government.

      YOU, YOUR WIFE AND THOSE THAT BACK YOU ARE THE CAUSE OF THIS COLLAPSE!

    11. dave schraub, indian says:

      have you noticed, that the hollywood in crowd loves obama? he is a rock star to these people. i myself do not understand it. what is it that these people think they know that we don't know? is it the fact that they think we are so stupid that we don't recognize socialism when we see it. i guess they think since their famous, they are smarter than us, and they can use their fame as a platform to protect us from ourselves. they became famous because they can memorize other peoples words.

    12. Austin, Provo, UT says:

      This is brilliant!

      I'm emailing this to a friend who's on the fence. :)

    13. Mary says:

      No, I did not have time to read the entire

      piece regarding Obama's redistribution obsession.

      However, I have heard the contempt in his voice

      when he says: 'In a country as rich as this …'

      and, 'We are our brother's keeper'. This last

      is explicitly Marxist ideology and I cannot understand how he is doing so well in the polls when communism is responsible for around 30 million deaths, the worst economic situations

      in history, even as it deprives people of individual rights, opportunity and, ultimately, self-respect and motivation to create, produce

      and take the risks necessary for both.

      America is rich because we are capitalist,

      in Obama's world, it wont take long before

      we are all poor. How do they miss the lessons

      of history so well?

    14. Carmen Quintana, San says:

      My views come from being a native Santa Fean. My father was born in the Territory of New Mexico; my mother in the State of NM. Redistribution of the wealth is not a new concept here. The Democrats have been in control of this State for over 60 years and carrying on that way since statehood.

      I think the Bureau of Indian Affairs is the most corrupt agency we have. Second to that, the Dept. of Veterans Affairs, Dept.of Interior, IRS, etc.etc.etc.

      If you check our real estate records, this redistribution has been ongoing since Territorial Days. To this day, we are still dealing with this redistribution. We have a Santa Fe Indian School with no recognized Santa Fe Indians. We have railyards that have reverted to original heirs with our state not recognizing that reversion.

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