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  • Morning Bell: $1.5 Trillion in New Taxes

    Two years ago, as the United States was coming out of the last recession, President Obama was asked how raising taxes on anyone would help with the economy. The President’s answer? “Normally you don’t raise taxes in a recession, which is why we haven’t, and why we’ve instead cut taxes.” Fast forward to today, as America is struggling with zero job growth and a stagnant economy, and the President has dramatically changed his rhetoric, proposing $1.5 trillion in new taxes on the American people and the country’s job creators.

    Those massive tax increases come as part of the President’s plan to reduce the nation’s out-of-control debt, but rather than address the underlying spending problem, it will further deepen America’s economic quagmire and only serves to stall the real reform America needs in order to get on a path of fiscal sanity, as Heritage’s Alison Fraser explains:

    Obama is demanding a ‘balanced’ approach as though somehow hiking taxes is both fair and necessary. But this notion that he is pushing — half tax hikes and half spending cuts — is beyond the class warfare message it sends. It is a tactic. A tactic to stall the real reforms that our leaders in Washington must undertake now in order to avert a fiscal, economic and moral crisis.

    Real reform is necessary because of the depth and scope of America’s spending nightmare. ”The federal government today is claiming roughly one-fourth of total economic output — about 25 percent of gross domestic product,” Heritage’s Patrick Knudsen writes. That’s a post-World War II record, and it’s a huge drag on the economy since all that spending is paid for by taxes and borrowing, which reduce the amount available for investment in the private economy. And down the road, the outlook isn’t good: Social Security is growing at a rate of 5.8 percent per year, Medicare at 6.3 percent, and Medicaid at 9 percent. Unless those programs are fundamentally reformed, their costs will keep going up, and taxes will have to keep being increased to pay for them.

    Disappointingly, the President yesterday retreated from his previous overtures to entitlement reform and took Social Security reform off the table while proposing minor cuts to Medicare and Medicaid–rather than the reform that would make a significant difference for the country. Obama’s plan is bad news for our nation’s defense as well, posing even more radical cuts for an already under-funded military.

    Setting aside for a moment the fact that the President’s plan ignores America’s core spending problems, his plan to drastically raise taxes is coming at a time when the country can least afford it. How will the latest Obama tax increase play out? Heritage’s Curtis Dubay explains:

    The new revenue would come from allowing the Bush tax cuts to expire for families and small businesses earning more than $250,000 a year, limiting their deductions, and the President’s new “Buffett Rule” that would further raise these job creators’ taxes in some way which the President has not defined. He also wants to eliminate deductions, credits, and exemptions. This is a war the President is waging on success–as if so-called fat cats were the root of our spending problems.

    The President has set his sights on the wealthy despite the fact that the top 10 percent of earners in America already pay about 70 percent of federal income taxes. And taxing America’s job creators will only serve to reduce productivity, slow economic growth, depress wages and salaries, and decrease household wealth. To use the President’s own words, raising taxes in bad economic times would “take more demand out of the economy and put businesses in a further hole.” Where is that President Obama today?

    Raising taxes will not fix our budget and debt crisis. But it can be solved by transforming our entitlement programs, rolling back wasteful and inefficient spending, protecting the nation, and overhauling our punitive, inefficient and noncompetitive tax code, as laid out in Saving the American Dream: The Heritage Plan to Fix the Debt, Cut Spending and Restore Prosperity.

    America is facing an unemployment crisis, a debt crisis, a spending crisis, and an entitlement crisis. Instead of making things better, President Obama wants to make matters worse by icing that nightmarish cake with massive tax increases. Two years ago, President Obama emphatically renounced raising taxes in a recession. Now, with the 2012 election looming, he has changed his tune and is taking aim at America’s job creators in a game of class warfare designed to play to his liberal base. Job creation has fallen by the wayside.

    Quick Hits:

    Posted in Economics [slideshow_deploy]

    48 Responses to Morning Bell: $1.5 Trillion in New Taxes

    1. msmii says:

      New Taxes MUST mean that we are going to have new jobs to pay them, right?

      Right?

      Right?

      USFWS Impedes America Economy While Supporting OPEC
      On December 6, 2010 Obama nominated Daniel M. Ashe to head and direct the US Fish and Wildlife Service (USFWS). What is the USFWS and who is Ashe? I feel that both questions are fairly simple to answer.
      The USFWS has impeded job growth, slowed the economy, restricted freedoms, restricted access to American lands by American people, is being used as a proxy arm of the government to black mail and beat into submission organizations like Gibson that are not supporters of the regime, and is being used, in a manner of speaking, to promote American reliance on a terrorist supporter for oil.
      http://msmignoresit.blogspot.com/2011/09/usfws-im

    2. Dave Wytko says:

      Kruschev said not to worry about him attacking the U.S., you will destroy yourself from within with taxes… or some such oration.

      • Clearhead says:

        David, the oration concluded with……."….they (the Americans) will accept more and more socialism in small pieces, until one day they wake up and discover they are full fledged communists"

      • 87MCSS says:

        If you like that here are some more for you:

        “Politicians are the same all over. They promise to build bridges even when there are no rivers.”

        “Economics is a subject that does not greatly respect one's wishes”

        “Call it what you will, incentives are what get people to work harder.”

        “Do you think when two representatives holding diametrically opposing views get together and shake hands, the contradictions between our systems will simply melt away? What kind of a daydream is that?”

    3. 38ksfarmer says:

      The whole scenario since this regime took power is Sad, Sickening and Disheartening. With any sane leader it would be Unbelievable. However, with o — anything is possible. His agenda – to destroy America – is right on schedule.

    4. Jeanne Stotler says:

      When Obama says he's only taxing the rich ie: those who provide the food and materials we use everyday, he's only trying to fool the poeple. All taxes are passed down the line and since cost of living has gone up over 200% in the last 30 years, this tax will make it increase furthue. It just keeps going, things cost more, workers ask for more pay and around it goes. Example my husband had a minor stroke in 1972, he spent 9 days in the hospital, admitted through the ER Bill for the complete 9 days was $834.45, we paid $5.25, BC/BS paid the rest, our grocery was about 85.00 a week for a family of 10 including an infant. Now the ER alone is more than that bill,and I spend $225. and over for a family of 4 adults. It needs to end. lets get a fair tAx

    5. Curt Krehbiel says:

      Eliminating the deduction for interest on home mortgages will constitute a major tax hike for most home owners. The mortgage deduction, because of its size, is what permits many taxpayers to itemize other smaller deductions that add up to a significant reduction in taxes owed at years end.

    6. Sandra says:

      I have to admitt that President Obama is a huge suscess, He told us while running for office that his goal was to "fundamentally change the United States" and to disarm her. He is doing a good job of both. We are moving into becoming a socialist country without any defences. When will "we the People" put a stop to this.

      • Howard Hatton says:

        We have to do it at the next election. The people who want this country bac & revers as much of the damage OBama has done must vote him out & make sure that we control & the presidency.
        O'Bama is systematically bankrupting our country so that he can make this a comunist country.

        The people are giving him a pass as they think he is doing the best he can – but He knows exactly what he is doing.

    7. kaydell bowles says:

      Thanks for the great article. The only thing left out was it is by design to destroy the America. It is what he said it was at the beginning–spreading the wealth around!

    8. Dr. Henry Sinopoli says:

      Of course we need new taxes, how else can we afford to maintain country club dues for Boehner and Obama. The last time they played golf Boehner came up the scheme to let Obama off the hook with the debt crisis. Get the lifer politician out on the links and he can help Obama find more millionaires to keep us floating along.

      Keep up the good work Heritage…sanity is a sea of impoverished thought.

    9. It will be interesting to see how the Republicans and Democrats ultimately resolve our financial difficulties. Neither political party or their acknowledged leaders have shown the economic aptitude necessary to bring about a successful conclusion. This simply means Americans must prepare themselves for more of the same – namely declining wages, fewer jobs, lost opportunities, a lower standard of living and financial hardship in an atmosphere of relentless attacks against each other for an illusionary advantage. This is not a good time for America!

      • Robert, TX says:

        An excellent post, and another reason to start fighting for the Constitution and electing Patriots – instead of the rep. vs. dem. name-calling and catfighting (which is fun sometimes, but accomplishes nothing).

    10. Gilbert Doan says:

      You always come through with reallygood stuff!

    11. Mary......WI says:

      With Obama at the helm this country is doomed. Come on GOP get your act together!! Listen to what the pros at the Heritage Foundation have to say….then do it!!

    12. Dara says:

      Okay… Obama beats the 'Bush Tax Cuts' like a long dead horse… if he insists – let them ALL expire – along with the deductions – which cause the Government to SEND those at the bottom a check for monies they never paid in!

    13. akismet-1ad3f4d89ff5189b5834cb394cfcba1f says:

      Kruschev also said this…

      “You Americans are so gullible. No, you won’t accept communism outright, but we’ll keep feeding you small doses of socialism until you’ll finally wake up and find you already have communism. We won’t have to fight you. We’ll so weaken your economy until you’ll fall like over-ripe fruit into our hands.”
      http://www.ideasaboutamerica.com/viewbookexcerpt….

    14. Donald D. Thorin says:

      We have skirted the true and factual issue for three years. Obama told us exactly what he was going to do. The CHANGE in his campaign was taken from 1930s Germany's Hitler orations (viewed 1939, Movie Tone News). Destroy America's economy, political institution and societal makeup. Alexander Hamilton and James Madison, 1787 Federalist Papers # 9 & 10 and Abraham Lincoln, 1838 "Perpetuation of our Political Institution" speech in Springfield, Illinois and the 1980s Kruschev all have referred to the governmental integration of anti-democratic republican factions in positions of power. We must not, cannot let this continue to swell.

    15. KC - NM says:

      History shows that rebellions have occurred over stupid acts from monarchies, socialists and other out-of-touch leaders. If we really need more revenue overall, then make it fair. Taxing a class of Americans who have been successful is discriminatory. Our gutless leadership needs to propose a significant change to the broken tax process. Use the flat tax – only based on income, no deductions, no exceptions, no exclusions. Every American who works pays a set percent of what they make. For those that do not have an income, they pay a percent of what they receive from the government – either as a payment or as community service to pay back the debt. Get with it leaders!

    16. Lloyd Scallan says:

      Is anyone surprised? This has always been Obama plan from day one. As one of his lackeys announced,
      since they could not get their way going through Congress, they are reverting back to do whatever they wanted to do in the first place and at the same time energize their leftist base.

    17. Blair Franconia, NH says:

      This is what the Islamists want.

    18. toledofan says:

      Well, now that the cat is out of the bag, it's obvious that either this administraion is too stupid to know how to create jobs or they are so entrenched into their ideology that they can't do anything else because they don't know anything else or they really don't want to. Regardless of the reason, we are in deep trouble of losing the American Dream and it's really past time for Congress to start doing it's job. Any Democrats following this plan of destruction not only should be removed from office, they should be getting millions of fan mails daily telling them to do what is right for America and start doing their jobs, pronto.

    19. Mike Henebry says:

      Finally, President Obama realizes that we will never reduce our budget deficit without both cutting spending and raiding revenue. He has a good plan.

    20. Gerry Roth says:

      The President does not seem to recognize (or acknowledge) that every new dollar of taxes, especially when coming from changes to the tax code, increases the size and scope of the federal government. This increase in size actually becomes a future dependency which must be paid for by more taxes in the future.
      Someone is or becomes dependent on every dollar the government spends, regardless of source.

      Our collective goal must be to reduce (not grow) the size of government and reduce the expanding dependency. While we are at it, we will reduce the deficit year by year, thereby bringing the debt into realistic proportion to GDP as well. Reduction of the deficit is not the primary objective; it is reducing the size and breadth of government reach.

      The President wants the new stimulus to pay for "teachers and police and firemen" in local and state government – an example of paying for a continued government dependency now that we created in the past through careless government-public union policy.

    21. RogCol says:

      Ever notice when someone is going into bankruptcy, they max out all their credit cards. Looks like PBHO was paying attention up to and after his coronation.

    22. Jeff Dover says:

      Let's stop this talk of "fair" in taxation or any other area of US law. We are a nation founded and built upon "equal", not of "fair". "Fair" is one man's judgement and we are a nation of law, not of one man's judgement. "Fair" is a perfectly relative term having meaning unique to the person using the term. What is "fair" to one is "unfair" to another. "Equal", however, is equal: all are treated the same under the law.

      Let's lose the term "fair" in political discourse.

    23. Karla, CA says:

      Obama spent (threw away) $535 billion on Solyndra, and now wants to cut $525 billion from Medicare providers and services. Something is wrong with this picture!

      • independent thinker says:

        Karla, I'm sure it was an honest mistake, but you said "billion" for solyndra when you hopefully meant "million". right?

    24. Glen says:

      The Federal Gov't is out of control. Expansion of it only makes the public sector weaker. Bigger is not better, so the Federal gov't should get out of the way, and let the private sector do it's thing. Get out of the way, and PARK THE PLANE!!!

    25. Stirling says:

      It's a "Trojan Horse" bill for a power grab.. Look beyond the taxes and PR propaganda..

      the New Jobs Bill: It Overrides State’s Rights… http://www.theblaze.com/stories/what-you%e2%80%99

      …"For instance, buried deep, deep on page 133 of the bill, it states:
      SEC. 376. FEDERAL AND STATE IMMUNITY".

      "(a) Abrogation of State Immunity- A State shall not be immune under the 11th Amendment to the Constitution from a suit brought in a Federal court of competent jurisdiction for a violation of this Act".

      …"It gets even better:"

      "(A) WAIVER- A State’s receipt or use of Federal financial assistance for any program or activity of a State shall constitute a waiver of sovereign immunity, under the 11th Amendment to the Constitution or otherwise, to a suit brought by an employee or applicant for employment of that program or activity under this Act for a remedy authorized under Section 375(c) of this Act [emphasis added]."

      • Greg Marks says:

        When the gov't wants to reduce alcohol consumption, it raises taxes on alcohol. When the gov't wants to reduce cigarette smoking, it taxes cigarettes. When the gov't wants to reduce fuel consumption, it taxes fuel. When OB1 wants to reduce business in America, he'll tax businesses. When OB1 wants to reduce investment in America, he'll tax investment. Is this what OB1 really wants? I think so.

    26. Mark says:

      Even if raising taxes on "the rich" made sense, it's not like the Obama admin. would use the revenues raised to reduce the deficit – they would spend it on more liberal projects.

    27. Doug Nicholson says:

      Mark,
      You stole my thunder! You are absolutely correct!

    28. Jon Lacey says:

      To all my rich friends out there, I know you are not able to speak up about our elite Liberal Democrats wanting to raise your taxes, you are such great American's, you don't complain, well your in luck I will defend you against these men/women, the leaches of the country, the Democrats,.
      I know your fighting regulations from EPA, Unions, but the last thing you need, and I need, is to have your taxes raised. I want to thank all my rich friends for keeping me working for 60 years.
      I wonder how smart the people that work for Buffet are, knowing their boss wants all to pay higher taxes, of course they are followers of an old man that would not even turn his companies over to his own kin, he knows money, doesn't know life!

    29. Bobbie says:

      Obama wants attention on taxing the "rich" because state, local, city, municipal, and all other taxes will be raised on the rest of us!! America won't get ahead with this phony, indignant leadership.

    30. Denise says:

      The flip-flop he has made regarding tax raises during a recession proves he is taking our country down a ruinous path. I have learned that you watch what he does NOT what he says. He is a wolf in sheep's clothing. A nation of sheep will elect a government of wolves. It's time to get prepared by stocking up on essentials before it's too late.

    31. Grace E. Pratti says:

      Obama and Congress need to focus on budget not raising taxes, it only means more spending which at this time of recession we need to look at cutting wasteful spending and it starts with Pork Barrels and Ear Marks, not with Social Security, Medicare, Medicad, yes I agree on cutting military two wars that is costing America way to much money, Instead of both parties going back and forth, compromise and start getting on the ball with managing funds, These leaders we have in Washington need to wake up and get working that is what they get paid for. Wake up Congress.

    32. Joe Bittick says:

      10 middle class tax payers equal one middle class job as we are taxed today. If taxes are not raised then we will have to run the government on the taxes from the new jobs which means the government is running on 1/10th of the money it used to recieve. 85% of the jobs being developed are non-productive jobs which do not produce a product that can be taxed so again there is nothing to replace the taxs lost to develop the jobs. We're heading for bankruptcy. The only way to solve the problem is to figure out how to retire everyone 50 and above and bring in the youngsters.

      • Bobbie says:

        how about getting rid of unconstitutional government? that will take care of about 75% of America's problem!?

    33. MotherLodeBeth says:

      Actually its more akin to a fair tax. Why should I pay more in taxes than most political talking heads or the wealthy? And I am conservative!! We need a plain fair tax thats the same for all. Different taxes for different groups is what I call class warfare.

    34. @Algorithim says:

      If America is to survive, to return to her standing in the world community, to be that beacon of hope for so many millions, to be the stable and rock-steady anchor for the global economy, to provide a moral compass for a troubled and threatening world…OBAMA must go.

    35. @Algorithim says:

      I'm shocked and dismayed that any intelligent American could believe a single word of the barrel of lies The One is foisting upon us all…He's been orchestrating the dismantling and the demise of the capitalist American economy since even before he took office. If allowed to gain another four years for his agenda and his insidious plan, he will have more than enough time and opportunity to push America into such an abyss of economic and moral devastation, that recovery will be only a fleeting memory of what we might have had a chance to initiate, if We, The People had held this ObamaNation to a single term.

    36. @Algorithim says:

      America is the land of second chances, and ours as a nation is upon us with the 2012 election. If we fail our Founding Fathers, and all the tens of thousands of brave men and women who have fought and died for our nation's exceptionalism, then we will have failed not just ourselves, but our future generations, and our children's children. Nothing has ever been more important – Obama and the hate-filled Socialist Democratic Party must be voted out of office and out of power next year – utterly and completely.

    37. Whicket Williams says:

      The New world Order is almost complete. Read the bible If you want to know what is going to happen the prophecies made over 4000 years ago are coming true like clockwork. No sane person can doubt it.

    38. Larry Witmer says:

      The Bush tax cuts put billions of dollars into the pockets of wealthy Americans. Why haven't these extra dollars been put to work to create jobs? If they are not using their wealth to create jobs, why not collect more tax revenues and use this money to help get jobs created? Is it not really increased demand that causes new jobs to be created? Why would the wealthy invest in job creation if the population is not buying? WE NEED MORE PEOPLE WITH MORE BUYING POWER!

    39. FairTax Guy24 says:

      I am a current student attending Ivy Tech Community College in Sellersburg, IN we are studying the
      pros and cons of the fairtax.

      The president should focus on all wage earners paying their fair share of taxes and not just the top wage earners.

    40. Tax Guy #98 says:

      The Fair Tax Plan is a great idea. The issue is to keep Congress from adding and/or changing the tax structure without the approval of the tax payers. This is what got us in the mess we are in today. Our politicians in Washington have no limits to what or how much they can tax the voting citizens and when they run out of money for budgets, they rob from what is available or increase taxes or create new taxes to cover their spending habits.
      Let's get a check and balance system to control Congress from spending us into bankruptcy.

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