A New Era of Responsibility

[ClydeR]

Obama's budget overview, "A New Era of Responsibility: Renewing America's Promise" is available for download here (http://www.gpoaccess.gov/usbudget/fy10/index.html). It's a 146-page summary of the detailed budget that he will present in April.

If you get started reading it right now, you might be finished in time for us to discuss it tomorrow morning. :)

[Back]

I’ll read the cover. 145 of you each take a page and we can have this figured out in an hour.

[Parkbandit]

President Obama has laid out the most ambitious and expensive domestic agenda since LBJ, and now all he has to do is figure out how to pay for it. On Tuesday, he left the impression that we need merely end "tax breaks for the wealthiest 2% of Americans," and he promised that households earning less than $250,000 won't see their taxes increased by "one single dime."

This is going to be some trick. Even the most basic inspection of the IRS income tax statistics shows that raising taxes on the salaries, dividends and capital gains of those making more than $250,000 can't possibly raise enough revenue to fund Mr. Obama's new spending ambitions.

Consider the IRS data for 2006, the most recent year that such tax data are available and a good year for the economy and "the wealthiest 2%." Roughly 3.8 million filers had adjusted gross incomes above $200,000 in 2006. (That's about 7% of all returns; the data aren't broken down at the $250,000 point.) These people paid about $522 billion in income taxes, or roughly 62% of all federal individual income receipts. The richest 1% -- about 1.65 million filers making above $388,806 -- paid some $408 billion, or 39.9% of all income tax revenues, while earning about 22% of all reported U.S. income.

Note that federal income taxes are already "progressive" with a 35% top marginal rate, and that Mr. Obama is (so far) proposing to raise it only to 39.6%, plus another two percentage points in hidden deduction phase-outs. He'd also raise capital gains and dividend rates, but those both yield far less revenue than the income tax. These combined increases won't come close to raising the hundreds of billions of dollars in revenue that Mr. Obama is going to need.

But let's not stop at a 42% top rate; as a thought experiment, let's go all the way. A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That's less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable "dime" of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.

Fast forward to this year (and 2010) when the Wall Street meltdown and recession are going to mean far few taxpayers earning more than $500,000. Profits are plunging, businesses are cutting or eliminating dividends, hedge funds are rolling up, and, most of all, capital nationwide is on strike. Raising taxes now will thus yield far less revenue than it would have in 2006.

Mr. Obama is of course counting on an economic recovery. And he's also assuming along with the new liberal economic consensus that taxes don't matter to growth or job creation. The truth, though, is that they do. Small- and medium-sized businesses are the nation's primary employers, and lower individual tax rates have induced thousands of them to shift from filing under the corporate tax system to the individual system, often as limited liability companies or Subchapter S corporations. The Tax Foundation calculates that merely restoring the higher, Clinton-era tax rates on the top two brackets would hit 45% to 55% of small-business income, depending on how inclusively "small business" is defined. These owners will find a way to declare less taxable income.

The bottom line is that Mr. Obama is selling the country on a 2% illusion. Unwinding the U.S. commitment in Iraq and allowing the Bush tax cuts to expire can't possibly pay for his agenda. Taxes on the not-so-rich will need to rise as well.

On that point, by the way, it's unclear why Mr. Obama thinks his climate-change scheme won't hit all Americans with higher taxes. Selling the right to emit greenhouse gases amounts to a steep new tax on most types of energy and, therefore, on all Americans who use energy. There's a reason that Charlie Rangel's Ways and Means panel, which writes tax law, is holding hearings this week on cap-and-trade regulation.

Mr. Obama is very good at portraying his agenda as nothing more than center-left pragmatism. But pragmatists don't ignore the data. And the reality is that the only way to pay for Mr. Obama's ambitions is to reach ever deeper into the pockets of the American middle class.

http://online.wsj.com/article/SB123561551065378405.html?mod=djemEditorialPage

I need to start selling Carbon Credits to offset the increased taxes that are coming my way.

[Ignot]

President Obama has laid out the most ambitious and expensive domestic agenda since LBJ, and now all he has to do is figure out how to pay for it. On Tuesday, he left the impression that we need merely end "tax breaks for the wealthiest 2% of Americans," and he promised that households earning less than $250,000 won't see their taxes increased by "one single dime."

This is going to be some trick. Even the most basic inspection of the IRS income tax statistics shows that raising taxes on the salaries, dividends and capital gains of those making more than $250,000 can't possibly raise enough revenue to fund Mr. Obama's new spending ambitions.

Consider the IRS data for 2006, the most recent year that such tax data are available and a good year for the economy and "the wealthiest 2%." Roughly 3.8 million filers had adjusted gross incomes above $200,000 in 2006. (That's about 7% of all returns; the data aren't broken down at the $250,000 point.) These people paid about $522 billion in income taxes, or roughly 62% of all federal individual income receipts. The richest 1% -- about 1.65 million filers making above $388,806 -- paid some $408 billion, or 39.9% of all income tax revenues, while earning about 22% of all reported U.S. income.

Note that federal income taxes are already "progressive" with a 35% top marginal rate, and that Mr. Obama is (so far) proposing to raise it only to 39.6%, plus another two percentage points in hidden deduction phase-outs. He'd also raise capital gains and dividend rates, but those both yield far less revenue than the income tax. These combined increases won't come close to raising the hundreds of billions of dollars in revenue that Mr. Obama is going to need.

But let's not stop at a 42% top rate; as a thought experiment, let's go all the way. A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That's less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable "dime" of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.

Fast forward to this year (and 2010) when the Wall Street meltdown and recession are going to mean far few taxpayers earning more than $500,000. Profits are plunging, businesses are cutting or eliminating dividends, hedge funds are rolling up, and, most of all, capital nationwide is on strike. Raising taxes now will thus yield far less revenue than it would have in 2006.

Mr. Obama is of course counting on an economic recovery. And he's also assuming along with the new liberal economic consensus that taxes don't matter to growth or job creation. The truth, though, is that they do. Small- and medium-sized businesses are the nation's primary employers, and lower individual tax rates have induced thousands of them to shift from filing under the corporate tax system to the individual system, often as limited liability companies or Subchapter S corporations. The Tax Foundation calculates that merely restoring the higher, Clinton-era tax rates on the top two brackets would hit 45% to 55% of small-business income, depending on how inclusively "small business" is defined. These owners will find a way to declare less taxable income.

The bottom line is that Mr. Obama is selling the country on a 2% illusion. Unwinding the U.S. commitment in Iraq and allowing the Bush tax cuts to expire can't possibly pay for his agenda. Taxes on the not-so-rich will need to rise as well.

On that point, by the way, it's unclear why Mr. Obama thinks his climate-change scheme won't hit all Americans with higher taxes. Selling the right to emit greenhouse gases amounts to a steep new tax on most types of energy and, therefore, on all Americans who use energy. There's a reason that Charlie Rangel's Ways and Means panel, which writes tax law, is holding hearings this week on cap-and-trade regulation.

Mr. Obama is very good at portraying his agenda as nothing more than center-left pragmatism. But pragmatists don't ignore the data. And the reality is that the only way to pay for Mr. Obama's ambitions is to reach ever deeper into the pockets of the American middle class.

http://online.wsj.com/article/SB123561551065378405.html?mod=djemEditorialPage

I need to start selling Carbon Credits to offset the increased taxes that are coming my way.

So you read the 146 page document?

[ClydeR]

I'm on page 22. So far there's no specific mention of the things Bobby Jindal said to watch out for--volcano monitoring and monorails to Disneyland. There was some talk about high speed rails a few pages back, but it didn't specifically mention Disneyland.

[Methais]

I'm on page 22. So far there's no specific mention of the things Bobby Jindal said to watch out for--volcano monitoring and monorails to Disneyland. There was some talk about high speed rails a few pages back, but it didn't specifically mention Disneyland.

That's because it'll stop 1 block from Disneyland, thereby not making it a monorail to Disneyland.

[Parkbandit]

So you read the 146 page document?


Serious question: Are you stupid?

What the fuck does me linking and posting an article about this budget have to do with me reading the 146 page budget?

[Parkbandit]

That's because it'll stop 1 block from Disneyland, thereby not making it a monorail to Disneyland.

They don't call him "Dirty Harry" Reid for nothing.

[Ignot]

Serious question: Are you stupid?

What the fuck does me linking and posting an article about this budget have to do with me reading the 146 page budget?

I wasn't rude to you so I'm not sure why you are being rude to me. It seemed to me that you simply saw a new political thread and went on another of your rants. This thread is about the document which is why I asked if you read it. If you want to comment on the budget without reading it then by all means. I'll excuse myself from every asking such terrible and horrible question like "have you read the document?".


Neg rep A New Era of... 02-26-2009 02:14 PM Negative rep just because you are fucking too stupid for words. -PB

whoa just calm down. you are acting like a little girl.





That being said I have made it to page 11, it's been a busy day but I've never read something like this and it is pretty interesting.

[Parkbandit]

I wasn't rude to you so I'm not sure why you are being rude to me. It seemed to me that you simply saw a new political thread and went on another of your rants. This thread is about the document which is why I asked if you read it. If you want to comment on the budget without reading it then by all means. I'll excuse myself from every asking such terrible and horrible question like "have you read the document?".

Neg rep A New Era of... 02-26-2009 02:14 PM Negative rep just because you are fucking too stupid for words. -PB

whoa just calm down. you are acting like a little girl.

That being said I have made it to page 11, it's been a busy day but I've never read something like this and it is pretty interesting.

I linked an article that was bringing to light the fallacy of Obama paying for this bill somehow by taxing no one but the top earners in the country.. and no one below 250K. Did you even try and read the article? Because the reply you posted made absolutely zero sense.. hence my questioning your intelligence.

From this point forward, please do not respond to this thread until you have read the entire 146 pages.. I await your stellar input though when you do.

[Back]

From this point forward, please do not respond to this thread until you have read the entire 146 pages.. I await your stellar input though when you do.

Are you holding this rule just to him or to everyone including yourself?

[Back]

I'm on page 22. So far there's no specific mention of the things Bobby Jindal said to watch out for--volcano monitoring and monorails to Disneyland. There was some talk about high speed rails a few pages back, but it didn't specifically mention Disneyland.

Gov. Jindal Follow-up: What Is 'Volcano Monitoring'? (http://news.yahoo.com/s/livescience/govjindalfollowupwhatisvolcanomonitoring)


Volcano monitoring likely saved many lives - and significant money - in the case of the 1991 eruption of Mount Pinatubo in the Philippines (where the United States had military bases at the time), according to the USGS.

The cataclysmic eruption lasted more than 10 hours and sent a cloud of ash as high as 22 miles into the air that grew to more than 300 miles across.

The USGS spent less than $1.5 million monitoring the volcano and was able to warn of the impending eruption, which allowed authorities to evacuate residents, as well as aircraft and other equipment from U.S. bases there.

The USGS estimates that the efforts saved thousands of lives and prevented property losses of at least $250 million (considered a conservative figure).

And this country really needs to step it up with the high speed rail.


I am extremely disappointed with the ignorance and dishonesty Jindal displays all in the name of his own political career.

[Mabus]

I'll excuse myself from every asking such terrible and horrible question like "have you read the document?".
Don't ask the current Congress that question about previous bills they passed. They get uppity, as do the administration supporters.

[Parkbandit]

Are you holding this rule just to him or to everyone including yourself?

Thank you for proving my point.

Ignot, I expect a full apology.

[Ignot]

Thank you for proving my point.

Ignot, I expect a full apology.

LOL

[aesir]

I say we all give Wall Street more money . . . so I can sell out my positions.

[Back]

Thank you for proving my point.

Ignot, I expect a full apology.

I don’t think you made any other point than Ignot’s.

Thank Ignot for pointing that out.

[Daniel]

Serious question: Are you stupid?

What the fuck does me linking and posting an article about this budget have to do with me reading the 146 page budget?

Well, for one, if you had you'd realize that there are other spending cuts to complement tax cuts on the higher tax brackets.

[TheRunt]

I’ll read the cover. 145 of you each take a page and we can have this figured out in an hour.

I'll take pages 2 & 4 :welcome:

[Tisket]

The government just needs to start taxing toilet paper. Slap on a nickel tax per roll and the US would be debt free in no time. Either that or only the wealthy would be able to wipe...