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Obama’s anti-stimulus plan

February 26, 2009

By Thomas Ravenel

President Obama states that he is going to give the economy a boost by
giving 95% of working families a tax cut and giving the top 2% of tax
filers a tax hike. Sounds great until you understand that 40% to 50%
of the families getting an income tax cut don’t even pay income taxes
but will get a tax rebate check anyway; this used to be called welfare
now they are calling it a tax cut.

The richest 1 percent — about 1.65 million filers making above
$388,806 — paid some $408 billion, or 39.9 percent of all income tax
revenues. While there are no figures on what the top 2% pay, it’s
fair to say it’s not far from 50% of all income tax revenues. So
while the President states he is going to cut taxes for 95% of working
families, the reality is that the folks who pay half of all income
taxes will not only be excluded from tax relief but will instead be
hit with a tax increase. When the tax code is used to punish our most
productive people we will get less prosperity. History gives us many
examples that the rich pay more taxes when their tax rates go down not
up. When Reagan cut the top marginal tax rate from 70% to 28% a lot
of smart people were given the incentive to risk time, talent and
capital to develop personal computers, cell phones, fax machines, and
broad band internet and the economy sky-rocketed and revenues
gushered, doubling the treasury’s take with the lower tax rate during
Reagan’s presidency.

Depending on methodology, America now has either the highest or the
second highest corporate income tax in the industrialized world – an
average of 16 points higher than the European average. This high rate
drives investment and jobs away from America and should be slashed.
Now that would stimulate the economy!

Under Obama, a small businessperson will see his taxes increase to
over 60%. The top federal rate will effectively rise from 35% to 42%;
add the state rate of 7% and 15.3% for payroll taxes (when Obama
uncaps the limit on payroll taxes) and voila: a rate effectively over
60%. The rich might as well rat hole their money in tax-exempt bonds.
The only thing the Obama tax plan will stimulate is the tax-exempt
municipal bond market.

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4 Comments leave one →
  1. llabesab permalink
    February 26, 2009 7:18 PM

    Just got off the phone with my Doctor. Medically speaking, he says there is more “Stimulus” in half an Aspirin than in The Anointed One’s Pork Ridden Package.

    It is sad to see that anyone with the middle name “Hussein” would approve of PORK.

  2. Redbank Bar permalink
    March 1, 2009 11:13 PM

    Clinton raised taxes on the well-off and the economy took off. I guess T-Rav killed too many brain cells and he has to spout talking points without substance.

  3. Silence Dogood permalink
    March 3, 2009 1:40 AM

    You guys removed my prior response!?! Now this is rich – can I just assume that was the “fairness doctrine” at work as to why you posted and then deleted the comment I had to this article. That is really pitiful.

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  1. Haire of the Dog | Charleston City Paper » T-Rav disses Obama stimulus plan

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