Morning Bell: The Obama Middle-Class Tax Hike is Coming
Posted August 3rd, 2009 at 9.12am in Ongoing Priorities.
Campaigning just last year, then-candidate Barack Obama repeatedly promised audiences at campaign stops across the country: “If you’re a family that’s making $250,000 a year or less, you will see no increase in your taxes. Not your income tax, not your payroll tax, not your personal gains tax, not any of your taxes.” But now President Obama is finding that keeping the promises made by candidate Obama is next to impossible. You just can’t borrow a trillion dollars for an economic stimulus, enact a new trillion dollar health care entitlement, and increase discretionary spending by 12% through 2019 (including doubling federal education spending) and then expect to pay for it all by taxing the most productive Americans. Eventually the moment comes when reality catches up to campaigning . That moment is fast approaching.
This weekend on the Sunday talk shows, both Treasury Secretary Timothy Geithner and National Economic Council Director Larry Summers refused to rule out the possibility that President Obama will raise taxes on the middle class. Secretary Geithner’s middle-class tax hike admission came among the context of deficit reduction on ABC’s This week:
Secretary Geithner: [I]f we want an economy that’s going to grow in the future, people have to understand we have to bring those deficits down. And it’s going to be difficult, hard for us to do. And the path to that is through health care reform. But that’s necessary but not sufficient. We’re going to do some other things as well.
George Stephanopoulos: So revenues are on the table as well?
Geithner: Again, we’re not at the point yet where we’re going to make a judgment about what it’s going to take. But the important thing…
Stephanopoulos: But you’re not ruling it out. You can’t rule it out.
Geithner: Well, I think that what the country needs to do is understand we’re going to have to do what it takes. We’re going to do what’s necessary.
Summers was then pressed to clarify Geithner’s comments on Face the Nation:
Bob Schieffer: I’m going to ask you about that in just a second, but let me just go back to this just to make sure. You don’t see another round of tax increases coming?
Summers: Tax increases. Look, let– let’s understand where we have been. Let’s understand that the President put in place, as part of the stimulus bill, as part of the economic recovery act, a measure he had campaigned on, the making work pay tax act that’s reducing taxes by eight hundred dollars for working– for working families. That’s where the– that’s where the focus is. We are going to keep working to strengthen the foundation–Schieffer: No– no tax increases for middle-income Americans?
Summers: –foundation of this economy. There’s a lot– oh, there’s a lot that can happen over time. But the priority right now, and so it’s never a good idea to absolutely rule things– rule things out no matter what.
So you’ve been warned, America: the Obama administration is no longer promising not to raise your taxes. And how can they? Just this past week the administration’s “cash for clunkers” burned through $1 billion in less than a week. How did the White House respond? By ending the deficit-raising bailout? No, they encouraged the House to authorize another $2 billion giveaway. That money has to come from somewhere. That somewhere is you.
Quick Hits:
- The Obama administration is is considering transferring some detainees at the military prison at Guantanamo Bay, Cuba, to a facility in the United States that would be jointly run by the departments of Defense, Justice, and Homeland Security.
- House Democrats have declined to subpoena available records that might reveal whether other members of Congress got discounted VIP mortgages from subprime lender Countrywide Financial Corp. similar to the sweetheart deals given Democratic Sens. Chris Dodd and Kent Conrad.
- A liberal activist group founded by former Democratic National Committee chairman Howard Dean is attacking Sen. Ben Nelson (D-NE) as “bought and paid for by health and insurance interests” and suggested he is “corrupt” and “out of touch.”
- Strapped local and state governments spent a total of $21.4 million on lobbyists between April and June this year lobbying for stimulus funds.
- Both Sens. Claire McCaskill (D-MO) and John McCain (R-AZ) say they will not approve the additional $2 billion the House wants to spend on extending the “Cash for Clunkers” program.
- Author: Conn Carroll
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August 3, 2009 Chris, Wisconsin writes:
Obama lied. Why am I not surprised?