The only tax that Obama will raise is the Capital Gains tax... I don't consider repealing (or letting expire) Bush's stupid ass Trickle Down tax cuts as a tax increase...
Here are some facts:
Under the Republicans, corporations have seen HUGE increases in profits and reduced tax liability. A recent study (
http://www.gao.gov/new.items/d08957.pdf) put out by the Government Accountability Office estimates that during their study period 28% of LARGE corporations (estimated as companies with assets exceeding $250 million) didn't even pay income tax and that overall... more then 60% of corporations paid no tax across all income brackets.
Why is this important? Well, the Bush administration, led by Treasury Secretary Paulson and conservatives led by John McCain are mounting a major campaign to cut the corporate tax rate even more, arguing that we are crippled competitively by having a US rate higher than any industrial nation other than Japan. "America has the second highest business [tax]rate in the entire world," says John McCain. "Is it any wonder that jobs are moving overseas? We're taxing them out of the country." But the GAO study confirms what we already knew: whatever the nominal tax rate, US corporations pay an effective rate among the lowest in the industrial world.
Yet the core of McCain economic agenda consists of breath-taking corporate tax breaks. He calls for cutting the top corporate rate from 35% to 25% and allowing corporations to write off investments in the first year. Combined, the Tax Policy Center wonks cost these at over $1.3 trillion over 10 years. Len Burman of Tax Policy Center estimates that in total, McCain would cut corporate revenues by about 50% from current levels. They'll be making hundreds of millions of dollars and not paying taxes. This is no joke.
To pay for these tax breaks, sustain the Bush tax cuts, add more tax breaks AND balance the budget in four years, as McCain promises, will require heroic cuts in spending. Not military spending; McCain promises to increase that. How will he do this? On the stump, McCain promises to veto any earmarked spending. But that is a gesture, providing about $18 billion a year. (And he isn't exactly consistent. McCain often tells folks who defend a local project that it is the process, not the individual project that he opposes.) Perhaps that's why McCain calls for raising Medicare taxes on seniors with over $50,000 a year in income and taxing employer-based health care benefits for families. Working people and seniors will help pay the tab for the corporate tax give-away.
It's hard not to wonder about the pure, contrary, inanity of the current conservative position. Our military is by far the strongest in the world, while our trains are among the slowest and our sewers are collapsing. So they propose raising spending the military and cutting domestic investment. We suffer gilded age inequality, with the wealthiest 15,000 families -- one-one hundredth of one percent of the population -- capturing fully one-fourth of the entire income growth from 2000 to 2006. Their average income rose from $15.2 million per year to $29.7 million per year. Meanwhile, the rest of us -- 133 million households that make up 90% of the country -- divided up 4% of the nation's income, adding about $305 to our average $30,354 income. So conservatives push for more tax cuts for the wealthy, while proposing to tax employer based health benefits. Corporate profits (prior to the recession) have catapulted to what is by far the highest percentage of national income in the past half century. So they want to cut corporate taxes, inevitably increasing the burden on labor. The economic future looks dim because consumers, drowning in debt, are cutting back. So they suggest cutting taxes on corporate investments will generate new investments and growth -- as if companies don't need someone to buy the products they make.
America's strength lies in the hands of the middle class BECAUSE without consumers there is no wealth to distribute. Republicans will argue this point as most are globalists (or buy into what globalists are saying) and if consumer spending in the US is low they will just move their operations to a country where supply side economics works in the short term. Democrats, on the other hand, view the economy from the demand side and believe that placing money in the consumers hands will boost consumer spending, boost our economy and benefit everyone. Bush has even subscribed to this policy in the form of tax rebates recently when consumer spending was so low that it threatened the economy. Just this week, reports of poor consumer spending and rising unemployment caused the DOW to fall more then 300 points in a single day. Obama realizes that the way to grow our economy isn't to subscribe to failed "Trickle Down" policies and that introducing these tax credits will in fact boost the economy over the long term as the middle class grows. In addition to tax credits for individuals, he will also be providing credits to corporations who invest domestically to spurn employment. He will also reduce the amount of taxes a self employed person has to pay with these tax credits... currently, if your self employed, your tax burden is more then double an employed person because you have to pay the employee and employer parts of the income tax.
So... in review, Obama's plan is NOT wealth redistribution... it is capital investment to rebuild our economy from the ground up like fertilizer is to crops after a long drought. Yes... it takes money from the wealthy and invests it in the people... yes it's probably a socialist policy... but placing labels like these on good ideas doesn't magically make them bad ideas for our country over the long term. It's for the good of the country and our people and in no way put the wealthy at risk of losing their wealth... It merely requires that the wealthy reinvest in our country to improve our country as a whole. I am positive that he doesn't expect the rich to love him... but later on they will see the results and understand what he did.
