It’s the Government Spending, Stupid

Michael Fell
December 8, 2012 Posted by Michael Fell mjfell@hotmail.com

Government SpendingBarack Obama, who seemingly has remained in campaign mode since first entering public life, continues to insist House Republicans obey his command to hike tax rates on upper income earners and to ignore Government Spending.  If Republicans do note cede to his demands, Obama is willing to let everyone’s taxes go up and to cut one trillion dollars from the budget, a disproportionate amount of which will come from defense.

Were Obama sincerely interested in solving America’s fiscal dilemma, this would not be his stance.

He continues to make campaign appearances claiming that these higher tax rates are needed to lower the U.S. deficit and cut the national debt.

Nothing could be further from the truth.

The amount of revenue collected by the IRS as a result of such a tax rate increase would fund U.S. federal government spending for less than nine days.

According to the latest data from the Congressional Budget Office, at current spending levels the federal government is borrowing forty six cents of every dollar it spends.  Through the first two months of fiscal year 2013 the government is already almost $300 billion in debt.

http://www.washingtontimes.com/news/2012/dec/7/government-borrows-46-cents-every-dollar-it-spends/print/

Medicare, Social Security and interest on the debt are the biggest drivers of the debt.  The true costs of Obamacare have yet to be revealed, but given the U.S. federal government’s track record it is safe to predict that it will be far more expensive than projected and finish in the red every year.

Collecting eight days’ worth of spending from upper level incomes will do nothing to affect the level of spending on any of these programs.

Additionally, Obama willfully ignores that at current tax rates, revenues are up by thirty billion dollars over last year.

Obama, his “progressive” political allies and the obedient lapdogs within the “progressive” Party Pravda continue to foster the notion that raising tax rates on the highest income earners, those who already pay forty percent of all income tax revenue, will be a panacea, the magical elixir needed to solve America’s fiscal woes.

They also continue to lay the blame for today’s deficits on former President George W. Bush.  Bush’s highest deficit was $438 billion during his last year in office.  Obama’s government is poised to post another $1 trillion deficit, which will mark the fifth straight year of $1 trillion or more deficits.

America’s current financial predicament is the result of wasteful “progressive” government spending on big government socialist programs.

That is the reason.

America’s debt and deficit dilemmas can only be solved through reduced spending.  If and when the United States falls off a fiscal cliff or receives another credit downgrade, it will be because of “progressives”, not Conservatives.

The conversation should be about how to cut spending, not about how to increase taxes.

Political Party or media employer notwithstanding, anyone who says differently is being intellectually dishonest.

 

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2 Responses to It’s the Government Spending, Stupid

  1. George Wolke on December 8, 2012 at 6:32 am

    I think the proper conversation should be how to rationally cut the deficit through a combination of revenue increases (yes, that means tax increases and likely rate hikes) and spending reductions. But I disagree with your statement that Social Security is a driver of the deficit. That is simply not true! Social Security is separately funded and fully solvent. With minor adjustments, it will remain solvent well past our lifetimes. So let’s take it off the table.

    While you are correct, we cannot tax our way out of this problem its equally correct to note that we cannot cut our way out of the problem either. We need to focus on both sides of the equation in order to be successful.

    Let’s start by recognizing that taxes will be raised on 1/1. The GOP has a choice, either listen to the overwhelming majority of Americans and raise rates on the top 2% or own a tax cut on the entire population. When that’s done, work with the President to fairly address spending cuts. And yes, some of those will have to be to defense.

    I hope an agreement is reached before 1/1 but each day I get less optimistic. Let’s just hope.

  2. Tom Donelson on December 8, 2012 at 7:57 am

    Obama was truly interested in stopping the “fiscal cliff”, just go back to Simpson-Bowles which was his commission. You get your revenue enhancers, you keep tax rates lower to encourage economic growth and you cut the budget, and reduce the size of government compared to the overall GDP. A win-win.

    Let blunt, raising marginal tax rates is nothing more than punishing the rich and less about revenues. So why engage in policy that is less about doing what is right and more about punishing success? Second, let not forget that once the tax on the rich happens, it is only the beginning because you can’t forget the various taxes that Obamacare adds to the mix. So we will significant taxes imposed on both the Middle class and the rich as result of obamacare on top of the Obama tax increases.

    Social securty funded seperately, what universe do you live in? For years, Congress has been spending the Social Security surplus to begin with and now the “fictional Social Security” fund is running a deficit. Fictional accounts don’t account for the reality what is happening.

    Obama has made it clear it is his way or the highway and least we forget, the last job reports were the usual mediocrity that has marked this administration. 7.7 rate hide the truth namely for every new job created this month, nearly 4 workers dropped out of the job market. The participation dropped and half a million workers cease to exist. If we had a similar participation rate when Obama took office, we would be seeing an employment of 10 to 11%. Which is the most accurate accounting of what our economy is doing.

    As we enter the fifth year of the Obama permanent recession, the question that needs to be ask, why continue on a path that will leave us further improverished. Question for Obama lovers and voters; if we have a recovery why are less people as a percenage of the work force working today as oppose to when he took office and why is Middle Class income dropping like a rock? (Hint, it is not all Bush’s fault)

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