Plotting the destruction of the U.S. economy
By Alan Caruba
Right on through to the end of this year, Americans will hear and read about the "fiscal cliff" and the likelihood is that most will remain clueless about its impact or even what it has to do with the taxes they will be paying in 2013. For the 47% of Americans who pay no taxes, the debate is a distraction from watching the bowl games and other diversions.
As usual the Heritage Foundation has stepped up to inform those who think these issues are important. Amy Payne spelled it out in a recent commentary, saying "Tax hikes are the centerpiece of the problem, as the largest tax increase in American history is scheduled to kick in on January 1. This tax increase has been dubbed ‘Taxmageddon."
"Most of this massive tax increase stems from the expiration of the 2001 and 2003 tax cuts implemented under President George W. Bush. There is also the payroll tax cut, the alternative minimum tax patch, and a host of other policies that expire at year's end. In addition, five of the 18 tax increases built into Obamacare are scheduled to go into effect. Families will bear the brunt of this tax increase among American households, with an average increase of over $4,100 in taxes."
One wonders how many of those families voted to reelect Obama. If so, they are in for sticker shock when they filed their tax returns next year. As the Heritage Foundation and others have been shouting from the housetops, Obama care raises the hospital insurance (HI) portion of the payroll tax on wage income over $250,000 from 2.9 percent to 3.8 percent. It then applies that 3.8 percent rate to investment income-capital gains and dividends—for anyone about $250,000.
Tax experts like Curtis Dubay, a senior policy analyst for the Heritage Foundation, points out that "this is a massive policy change, since it represents the first time the payroll tax will apply to investment income." He calls this investment income HI tax "a dangerous step down a slippery, tax-hiking slope", predicting that "the economy will suffer, because incentives to work and invest will fall. Less work and investment will mean that businesses create fewer jobs and pay their existing workers less than they otherwise would have."
Dubay refutes President Obama's claim that his plan for taxing the rich would just be a return to the rates that existed under President Clinton. "That is flat out incorrect," noting that Obama is ignoring the tax hikes hidden in Obamacare.
Stephen Moore, a member of The Wall Street Journal's editorial board and a senior economics writer, a regular commentator on CNBC-TV and Fox News, has a new book out, Who's the Fairest of the Them All? The Truth About Opportunity, Taxes, and Wealth in America. ($21.50, Encounter Books). It blessedly brief, but it covers a lot of ground, especially as regards the lies coming out of the White House about the "rich."
A lot of Americans are oblivious to the fact that the President is operating from an ideology that is the opposite of everything that built the greatest economy the world has ever seen. His views are those of a Socialist or to put it more bluntly, a Communist. He stops short of initiating programs by which the government would nationalize all industries, but only because he knows that would get him impeached. Still, Obamacare in effect does that for the health care industry; twenty percent of the nation's economy.
In his book, Moore defends the free enterprise system as "the on-ramp to economic progress and rising incomes." Under President Obama, "the ranks of the poor have risen and the progress of the middle class has stalled in the United States in recent years because we have moved so aggressively away from free markets and toward ham-handed government solutions."
The lies the President told all through his 2008 campaign and the last four years of his first term have all been intended to create class warfare. Moore points out that "Mr. Obama says that in recent decades the middle class has suffered and shrunk. He is dead wrong on this count. In fact, the last thirty years (up until this recession) have been a boom period for the middle class."
The proof of that, Moore notes, "By 2011, after Mr. Obama's first three full years in office, and after nearly two years of radical spending and taxing policies, the median American family incomes declined by almost $4,500 for every race. The poverty rate increased, and so did the number of Americans losing their homes. Yes, Mr. Obama inherited an economic mess, but his policies have done little to stop the decline."
According to Obama, if you earn more than $250,000 you are among the "rich" in America. This is surely a redefining of what we used to consider rich; usually those earning a million or more. As things stand now "Our government," says Moore, "relies for more than 50 percent of its revenue on the richest three percent."
The tax rate increase on "the rich" that Obama is demanding would raise enough revenue to run the nation for about a week. Meanwhile, the U.S. must borrow $4.8 billion every day just to meet its expenses.
Obama's goals since becoming President can be found in the "Cloward-Piven Strategy" and I recommend you get familiar with it as the nation hurtles toward financial collapse because that is exactly what the strategy is intended to bring about in order to impose a total socialist/communist system on the world's greatest capitalistic economy.
Among the strategy's proposals was a "massive drive to recruit the poor onto the welfare rolls" and we have seen this in the expansion of the food stamp program and loosening of requirements for those on welfare to seek employment. The goal of the Cloward-Piven strategy is to ultimately "sabotage and destroy the welfare system in order to ignite a political and financial crisis that would rock the nation; poor people would rise in revolt; only then would ‘the rest of society' accept their demands."
That is Obama's definition of "fairness" and it exists today as half of society, those with jobs or self-employed, are having their income taxed at high rates to pay for goods and services for those who do not work or cannot find work.
So confident is Obama that he will take his family on yet another vacation to the sunny shores of Hawaii while leaving Congress behind to deal with the mess he not only "inherited", but has expanded. Other presidents "inherited" recessions and solved them by cutting taxes. A recent Rasmussen Reports poll noted that 73% of likely voters want government spending cut.
Obama has found ways to worsen the financial crisis and it has been deliberate. He is not merely "transforming" America, he is destroying it.
Alan Caruba writes a daily post at http://factsnotfantasy.blogspot.com. An author, business and science writer, he is the founder of The National Anxiety Center. © Alan Caruba, 2012