Study shows Obama tax plan bad news for the economy — especially in blue states

posted at 12:41 pm on July 19, 2012 by Ed Morrissey

Two months ago, the Congressional Budget Office issued a stark warning to Congress over the fiscal impact of “Taxmageddon,” the upcoming expiration of the Bush-era tax rates at the end of this year.  Allowing all of the tax rates to rise would push the US into recession:

Tax hikes and spending cuts set to take effect in January would suck $607 billion out of the economy next year, plunging the nation at least briefly back into recession, the nonpartisan Congressional Budget Office said Tuesday.

Unless lawmakers act, the economy is likely to contract in the first half of 2013 at an annualized rate of 1.3 percent, the CBO said, before returning to 2.3 percent growth later in the year.

Canceling those tax and spending policies would protect the recovery in the short run and encourage more vibrant growth, around 4.4 percent, in 2013, the CBO said. However, unless lawmakers adopt policies that would reduce budget deficits by a comparable amount down the road, the CBO said, the national debt would continue to climb, imperiling future economic growth.

Republicans want to follow the CBO’s advice and cancel the tax hikes, while looking for other ways to reduce spending rather than the sequestration policies set to take effect in January.  Democrats want to hold both hostage to force the GOP to agree to Obama’s proposal to raise taxes on earners over $250,000 — or $1 million, depending on which Democrats one asks, and when.  Will the economic impact of those tax hikes be much different than that of the full fiscal cliff?  According to a new study by Ernst and Young … no:

With the combination of these tax changes at the beginning of 2013 the top tax rate on ordinary income will rise from 35% in 2012 to 40.9%, the top tax rate on dividends will rise from 15% to 44.7% and the top tax rate on capital gains will rise from 15% to 24.7%.

These higher tax rates result in a significant increase in the average marginal tax rates (AMTR) on business, wage, and investment income, as well as the marginal effective tax rate (METR) on new business investment. This report finds that the AMTR increases significantly for wages (5.0%), flow-through business income (6.4%), interest (16.5%), dividends (157.1%) and capital gains (39.3%). The METR on new business investment increases by 15.8% for the corporate sector and 15.6% for flow-through businesses.

This report finds that these higher marginal tax rates result in a smaller economy, fewer jobs, less investment, and lower wages. Specifically, this report finds that the higher tax rates will have significant adverse economic effects in the long-run: lowering output, employment, investment, the capital stock, and real after-tax wages when the resulting revenue is used to finance additional government spending.

Through lower after-tax rewards to work, the higher tax rates on wages reduce work effort and labor force participation. The higher tax rates on capital gains and dividend increase the cost of equity capital, which discourages savings and reduces investment. Capital investment falls, which reduces labor productivity and means lower output and living standards in the long-run.

  • Output in the long-run would fall by 1.3%, or $200 billion, in today‟s economy.
  • Employment in the long-run would fall by 0.5% or, roughly 710,000 fewer jobs, in today‟s economy.
  • Capital stock and investment in the long-run would fall by 1.4% and 2.4%, respectively.
  • Real after-tax wages would fall by 1.8%, reflecting a decline in workers‟ living standards relative to what would have occurred otherwise.

John Merline at Investors Business Daily also points out that the effects will be felt more in the very states that support Obama the most:

Connecticut, New York, New Jersey, Massachusetts and California — all blue states — would suffer the most, according to a Tax Foundation report.

The reason, the study notes, is that these states have higher shares of wealthy taxpayers than the rest of the country. In each of them, those making more than $200,000 — the taxpayers targeted by Obama’s hikes — account for more than 56% of all federal income taxes paid in those states. The U.S. average, the report notes, is 50%.

“As a result, a higher proportion of new tax dollars will come from these states,” noted the Tax Foundation’s Ed Gerrish, “likely impacting local economies.”

IBD also notes in a separate editorial that the Obama proposal fails Fed chair Ben Bernanke’s test on policy:

Fed Chairman Ben Bernanke warned Congress Tuesday to “do no harm” to our fragile economy. …

“Economic activity appears to have decelerated” from the tepid first quarter, he said, and “available indicators point to a still smaller gain in the second quarter.”

Bernanke talked about a “loss of momentum in job creation” and slower household spending growth for Q2.

Manufacturing, he said, “has slowed in recent months.” The rise in spending on equipment and software “appears to have decelerated.” Indicators of future investment “suggest further weakness ahead.”

In this context, Bernanke encouraged lawmakers to adopt the Hippocratic Oath and “do no harm.”

“Fiscal decisions,” he said, “should take into account the fragility of the economy.”

Clearly, Obama has prioritized re-election over the fragile economy.  Why else would he talk about raising taxes as the economy slides toward recession, and the fiscal cliff guarantees one?  In my column for The Fiscal Times,  I write that the “you didn’t build it” comment relates directly to Obama’s view of the role of government in dictating economic outcomes, but mostly he just needs to fight Mitt Romney with good, old-fashioned class warfare more than he needs to position the US for recovery in 2013:

Once again, Obama wants to make this an issue of “fairness.” By arguing that it takes a village for anyone to succeed in a market, the President can argue for greater confiscation in tax policy, claiming that it will fuel a new level of success. …How bad will it be?  In the long run, Ernst & Young concludes, the tax hikes will cost more than 700,000 jobs and reduce economic output by 1.3 percent if the cuts go to fuel more government spending, using today’s economy as a measure.  Wages would fall by 1.8 percent, and investment would decline by 2.4 percent.  If the proceeds of the confiscatory policies get used to fund a broader reduction in tax rates below current levels – which is not part of Obama’s proposal – output still falls by 0.4 percent.

This demonstrates the problem with excessive government interventions in markets, which always suppress growth to some degree.  That is a rational trade-off, however, for a smoothly operating economy.  However, we do not have a smoothly operating economy nor have we had one for the last several years, thanks to a crash created by government manipulation of the lending and securities markets to achieve favored social-policy outcomes, and an economic plan afterward that consisted of short-term gimmicks and escalating ambiguity in tax, regulatory, and monetary policy.

We need to find ways to stimulate growth, not suppress it.  Obama’s argument that the village needs to confiscate more from those who invest and take risks to provide that growth is exactly the worst prescription possible for our ailing economy – and yet another demonstration that the President has learned nothing about small business or the economy after four years in office.

I wrote this earlier today, but it’s worth repeating: Small businesses and markets fund the government, not the other way around.  The reason why we have the capital to seize for building roads, bridges, and other infrastructure is because of the wealth created by free markets.  Without that wealth, the government could not sustain that infrastructure, and without the economic expansion and employment provided by risk-taking entrepreneurs, we wouldn’t need them at all.  Obamanomics is completely backwards, which is why it’s not terribly surprising to see the economy heading in that direction, too.


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Let me chime in with a little Froggish: Quelle Surprise!

The War Planner on July 19, 2012 at 12:46 PM

“Read my lips…..
You are nothing”

[Thunderous Cheers]

Electrongod on July 19, 2012 at 12:46 PM

They’re out of ideas and running out of time.
 
Forward ’12.
 
inthemiddle on July 12, 2012 at 3:39 PM

rogerb on July 19, 2012 at 12:47 PM

“But Ann Romney is a lying gold-digger! HAHAHAHAHAHAHAHAHA!”

-inthemiddle

Bishop on July 19, 2012 at 12:48 PM

…just wait until January of 2013 for the “surprises!”…and wait until Nov..Dec…and Jan of the lame duck sessions to see what will happen!

KOOLAID2 on July 19, 2012 at 12:49 PM

Obama, the creep and goon, knows nothing, or plays dumb to the masses.

Schadenfreude on July 19, 2012 at 12:49 PM

Good post, Ed.

Y’know … the picture used here reminds me of something …
I’ve ALWAYS seen a soul-darkness in Zero’s eyes.
LATELY, especially when he’s off TOTUS, those eyes are looking more and more like in this pic.
Sorta slow, half-closed, almost independently blinking.
Y’all keep that in mind the next time you can actually stomach watching his latest clips, and tell me if you agree ?
It’s beginning to look a bit creepier than normal.
ALMOST to the possible ‘what’s he on?’ place… seriously.
Eeerie.

pambi on July 19, 2012 at 12:50 PM

Obama up by 4 now, according to that clearly liberally-biased Fox News outlet.

inthemiddle on July 19, 2012 at 12:24 PM

In support of the wonderful rogerb

Schadenfreude on July 19, 2012 at 12:50 PM

Flunks the “do no harm” test.

Well DUH….. How many times do you have to be beat over the head with the truth ED. Cloward-Pivens Strategy it’s not hyperbolic inflammatory rhetoric, it is reality.

SWalker on July 19, 2012 at 12:50 PM

OT: Anyone getting Health Care insurance premium rebates under ObamaCare’s Medical Loss Ratio rules? Dear Leader will make sure they are paid between now and November…

d1carter on July 19, 2012 at 12:50 PM

In my column for The Fiscal Times, I write that the “you didn’t build it” comment relates directly to Obama’s view of the role of government in dictating economic outcomes, but mostly he just needs to fight Mitt Romney with good, old-fashioned class warfare more than he needs to position the US for recovery in 2013

It also relates to his failure to accept responsibility. While, on its face, its a slander of earners and successful individuals, it also connotates that failure is not your fault and can be projected onto someone else (the converse of the argument). Kind of puts the “Bush did it” arguments into a similar context, eh?

TWO CENT IDEA that yes, Virginia, I built.

ted c on July 19, 2012 at 12:51 PM

Please, still so naive.

Blue states just want to create a problem “Too Big To Be Ignored”.

In other words, they want Bail Out from the rest.

Sir Napsalot on July 19, 2012 at 12:52 PM

yet another demonstration that the President has learned nothing about small business or the economy after four years in office.

He doesn’t care.

BO is a man with a plan which does not include the best interests of its citizens.

He’ll be perfectly happy to light a match, burn the place down, take his “stash” elsewhere leaving the rest of us to salvage what is left.

No, he isn’t a “nice guy”. It’s time to stop making excuses for him.

Cody1991 on July 19, 2012 at 12:52 PM

Let me chime in with a little Froggish: Quelle Surprise!

The War Planner on July 19, 2012 at 12:46 PM

Les fleurs du mal

Schadenfreude on July 19, 2012 at 12:52 PM

Obama tax plan

If you’ve got a tax plan, you didn’t build that. Somebody else made that happen.

Lost in Jersey on July 19, 2012 at 12:53 PM

Nobel should have awarded him the prize in economics, all for his “own achievements”…wait…

Schadenfreude on July 19, 2012 at 12:53 PM

LA LA LA, I can’t hear you…I’m doubling down in Florida today
-dear leader

cmsinaz on July 19, 2012 at 12:55 PM

Buffoon Bernanke was asked about this two days ago, at the congressional hearing and uh-ahh’d, saying the OMB is correct…but…uh, ah…not knowing how to whack the moron in the WH over his stupid head.

I hate Bernanke as much as Greenspan. They s/b in prison.

Schadenfreude on July 19, 2012 at 12:55 PM

DOTUS 24/7

109 days.

PappyD61 on July 19, 2012 at 12:55 PM

Obama’s “you didn’t build it” comments seem to imply that he invented the notion of building roads, of having police/fire, etc. and all of that is new and without Obama we would be in some sort of wilderness. We have had all those things for my entire life.

crosspatch on July 19, 2012 at 12:55 PM

“Texas will soon be a swing state, I am the president…”

Schadenfreude on July 19, 2012 at 12:55 PM

who are mitt’s bundlers and where is his tax returns?
-lsm

cmsinaz on July 19, 2012 at 12:56 PM

American voters, may you never recover from the shame you inflicted upon yourselves by voting into the highest office such a turd. Out with him, and mocked into oblivion, so as to never repeat such charlatanry.

Schadenfreude on July 19, 2012 at 12:57 PM

If he gets re-elected, Obama will have the “flexibility” to bring even more economic ruin to the country.

wildcat72 on July 19, 2012 at 12:57 PM

Crude is up by 2.74/barrel at them moment.

Schadenfreude on July 19, 2012 at 12:58 PM

Study shows Obama tax plan bad news for the economy

wytshus on July 19, 2012 at 12:58 PM

Congress- please make the cuts permanent. A one year extension? Please, get some principles, and a spine.

tomg51 on July 19, 2012 at 12:58 PM

I wrote this earlier today, but it’s worth repeating: Small businesses and markets fund the government, not the other way around. The reason why we have the capital to seize for building roads, bridges, and other infrastructure is because of the wealth created by free markets. Without that wealth, the government could not sustain that infrastructure, and without the economic expansion and employment provided by risk-taking entrepreneurs, we wouldn’t need them at all. Obamanomics is completely backwards, which is why it’s not terribly surprising to see the economy heading in that direction, too.

God damn all the socialists and communists of the world!

Schadenfreude on July 19, 2012 at 12:59 PM

Study shows…

How about FACTS showed that when we had the same tax rates that President Obama is proposing our economy was booming, the rich were getting richer, the deficit..oh wait a minute? there was no deficit. We had a surplus. The 2001 and 2003 tax cuts were never meant to be permanent they were temporary that’s why they had an expire date.
Now all we have to do is do nothing. All the tax cuts have to expire for everybody, not just the high earners. We cannot afford them.

Salahuddin on July 19, 2012 at 1:00 PM

Robbinghood™

Schadenfreude on July 19, 2012 at 1:01 PM

“Social justice” is theft by thuggery.

Schadenfreude on July 19, 2012 at 1:03 PM

Salahuddin on July 19, 2012 at 1:00 PM

Imbecilic Troll Alert… Watch out folks, we got a wild one here…

SWalker on July 19, 2012 at 1:04 PM

How about FACTS showed that when we had the same tax rates that President Obama is proposing our economy was booming, the rich were getting richer, the deficit..oh wait a minute? there was no deficit. We had a surplus.

Salahuddin on July 19, 2012 at 1:00 PM

In keeping with the froggy-speak: où est le lien pour la preuve

Lost in Jersey on July 19, 2012 at 1:04 PM

When the Communist was campaigning, for the 2008 election, he said this, regarding his tax policies:

http://www.youtube.com/watch?v=GaGJfzWEJtQ

And, note - HE NEVER DENIED THE ACCUSATION – HE DEFLECTED AND USED HIS CLASS-WARFARE RHETORIC.

OhEssYouCowboys on July 19, 2012 at 1:04 PM

OT: Anyone getting Health Care insurance premium rebates under ObamaCare’s Medical Loss Ratio rules? Dear Leader will make sure they are paid between now and November…

d1carter on July 19, 2012 at 12:50 PM

Just got mine, equaling 9% of my premium. A few days earlier I received a notice of increase in premium for the coming year, equaling 10%. Imagine that.

TXUS on July 19, 2012 at 1:06 PM

The 2001 and 2003 tax cuts were never meant to be permanent they were temporary that’s why they had an expire date.

No, they were “temporary” because the Republicans in Congress couldn’t bring themselves to make them permanent, and when passed the Democrats controlled the Senate.

Now all we have to do is do nothing. All the tax cuts have to expire for everybody, not just the high earners. We cannot afford them

You forget that when the tax rates you envision were in place, the Federal budget was much smaller. As Limbaugh and others say, I’ll go back to the 2000 tax rates, IF you’ll go back to the 2000 Budget…DEAL? What we can’t afford is Obama’s SPENDING, that’s the D@mn problem, not the amount of money coming in, but the amount GOING OUT! What is so difficult to grasp about that?

JFKY on July 19, 2012 at 1:06 PM

Salahuddin on July 19, 2012 at 1:00 PM

Was the uh…was the spending back then the same as today too?

You need to try harder.

Bishop on July 19, 2012 at 1:06 PM

We cannot afford them.

Salahuddin on July 19, 2012 at 1:00 PM

We cannot afford all this Government spending..
Clinton era tax rate can’t afford this spending..

Electrongod on July 19, 2012 at 1:07 PM

I suppose we could have a little experiment. Let the blue States have their high taxes. The red States can select a tax rate they feel comfortable with. Then we can watch what happens.

pat on July 19, 2012 at 1:07 PM

“You don’t raise taxes in a recession.”
 
- President Barack H. Obama, 2009

rogerb on July 19, 2012 at 1:09 PM

TXUS on July 19, 2012 at 1:06 PM

That’s exactly why I was asking…LOL. I thought they would be required to pay the rebates before November but the premium increase notices not until after November…what a country!

d1carter on July 19, 2012 at 1:10 PM

This report finds that these higher marginal tax rates result in a smaller economy, fewer jobs, less investment, and lower wages.

“Leading to more government dependency. Perfect!”
~Obummer

Dexter_Alarius on July 19, 2012 at 1:10 PM

Just got mine, equaling 9% of my premium. A few days earlier I received a notice of increase in premium for the coming year, equaling 10%. Imagine that.

TXUS on July 19, 2012 at 1:06 PM

And, Oceania has never/always been at war with EastAsia!

OhEssYouCowboys on July 19, 2012 at 1:12 PM

New titles in the Obama Children’s Library

The Little Engine That Couldn’t Without Federal Assistance
My Little Crony
Fast and Furious George
Heather Has Two Mommies Without Jobs
Solynderella
Green Jobs and Scams

thanks Instapundit

Moesart on July 19, 2012 at 1:12 PM

The Late Steve Jobs Has A Few Words For Mr No-Jobs

http://predicthistunpredictpast.blogspot.com/2012/07/the-late-steve-jobs-has-few-words-for.html

M2RB: Simple Minds, Live Aid, Philadelphia, 13 July 1985

Resist We Much on July 19, 2012 at 1:13 PM

Schadenfreude on July 19, 2012 at 1:01 PM

+1

cmsinaz on July 19, 2012 at 1:14 PM

PERFECT PIC Ed…

excellent…

cmsinaz on July 19, 2012 at 1:14 PM

In keeping with the froggy-speak: où est le lien pour la preuve

Lost in Jersey on July 19, 2012 at 1:04 PM

quel âge êtes-vous? Je suppose que vous pouvez faire quelques recherches.

Salahuddin on July 19, 2012 at 1:16 PM

I suppose we could have a little experiment. Let the blue States have their high taxes. The red States can select a tax rate they feel comfortable with. Then we can watch what happens.

pat on July 19, 2012 at 1:07 PM

The locust libs would move to the low tax states and destroy them too. It’s being done all over the country. Obama just got done threatening Texas with becoming a swing state.

Howcome on July 19, 2012 at 1:16 PM

Link to this is in the HA mill…will appear later, I assume.

The number of Americans filing new claims for unemployment benefits rebounded last week, pushing them back to levels consistent with modest job growth after a seasonal quirk caused a sharp drop the prior period.

Schadenfreude on July 19, 2012 at 1:17 PM

I’m patiently waiting for the MSM to slam the Repubs because they didn’t jump on the Dem scheme to let the tax rate cuts expire that lets them off the no tax pledge.It’s coming,I know it is.

docflash on July 19, 2012 at 1:17 PM

Numbers are just rich people who hate black people.

Argument over, baby!

/Leftists I Know

mankai on July 19, 2012 at 1:17 PM

Moesart on July 19, 2012 at 1:12 PM

Robbing Hood

Schadenfreude on July 19, 2012 at 1:18 PM

From that ‘conservative’ bastion, CBS

…just for inthemiddle

RWM, what do you call that?

Schadenfreude on July 19, 2012 at 1:23 PM

How about FACTS showed that when we had the same tax rates that President Obama is proposing our economy was booming, the rich were getting richer, the deficit..oh wait a minute? there was no deficit. We had a surplus. The 2001 and 2003 tax cuts were never meant to be permanent they were temporary that’s why they had an expire date.
Now all we have to do is do nothing. All the tax cuts have to expire for everybody, not just the high earners. We cannot afford them.

Salahuddin on July 19, 2012 at 1:00 PM

You left out the crucial fact of how much the government spent during the Clinton years.

But please tell me what the tax rates will have to be and on whom to cover the 1.4 Trillion yearly deficits and start paying down the 15+ Trillion in current debt and preparing to pay the 100+ trillion in upcoming obligations (and how you plan on stopping the Democrats from growing government even more adding more spending that has to be paid for)?

gwelf on July 19, 2012 at 1:24 PM

Robbing Hood

Schadenfreude on July 19, 2012 at 1:18 PM

Heh, I was going to expand on that, but I don’t feel like being banned today.

I think I’ll go outside and find a road to admire.

Cody1991 on July 19, 2012 at 1:25 PM

Salahuddin on July 19, 2012 at 1:16 PM

 
Weird considering the informed responses and salient points to discuss regarding your initial post.
 
Oh well. You know what they say:
 

com se com sa
 
libfreeordie on June 21, 2012 at 5:41 PM

rogerb on July 19, 2012 at 1:26 PM

“You don’t raise taxes in a recession.”

- President Barack H. Obama, 2009

rogerb on July 19, 2012 at 1:09 PM

Tell that to St. Reagan who in 1982 during a recession signed $100 billion tax hike—the largest tax increase since World War II.

Salahuddin on July 19, 2012 at 1:26 PM

Tell that to St. Reagan who in 1982 during a recession signed $100 billion tax hike—the largest tax increase since World War II.

Salahuddin on July 19, 2012 at 1:26 PM

This is now, for the utterly stupid.

Schadenfreude on July 19, 2012 at 1:27 PM

Study shows Obama tax plan bad news for the economy — especially in blue states

There would be sort of a poetic justice in that.

cajunpatriot on July 19, 2012 at 1:27 PM

OT: Anyone getting Health Care insurance premium rebates under ObamaCare’s Medical Loss Ratio rules? Dear Leader will make sure they are paid between now and November…

d1carter on July 19, 2012 at 12:50 PM

Yup – $20 from Anthem BCBS – big woop.
Maybe we’ll have a government funded pizza tonight….

dentarthurdent on July 19, 2012 at 1:28 PM

rogerb on July 19, 2012 at 1:26 PM

Do you have any facts disputing what I said?

Salahuddin on July 19, 2012 at 1:30 PM

Tell that to St. Reagan who in 1982 during a recession signed $100 billion tax hike—the largest tax increase since World War II.

Salahuddin on July 19, 2012 at 1:26 PM

Nice dodge. So tell me, what the tax rates will have to be to get us out of debt?

gwelf on July 19, 2012 at 1:31 PM

Do you have any facts disputing what I said?

Salahuddin on July 19, 2012 at 1:30 PM

Yeah we didn’t get into much debt during the Clinton years when taxes were higher. But spending was much much lower too. The spending is the problem not the revenue. What will tax rates have to be in order to balance our current budget and pay down the debt?

gwelf on July 19, 2012 at 1:33 PM

Do you have any facts disputing what I said?
 
Salahuddin on July 19, 2012 at 1:30 PM

 
Only what the CBO and President Obama’s financial advisers determined.
 
You?

rogerb on July 19, 2012 at 1:38 PM

Tell that to St. Reagan who in 1982 during a recession signed $100 billion tax hike—the largest tax increase since World War II.

Salahuddin on July 19, 2012 at 1:26 PM

Go do some research beyond Dem talking points.
TEFRA was a deal between Reagan and the Dem controlled Congress (both houses) to reverse some planned future tax cuts and close some loopholes – but with no change in tax RATES. Part of that deal was to reduce spending $3 for every $1 in tax increase – but the Dems violated that agreement and jacked up spending anyway by overriding Reagan’s veto on the budget bill they passed.

dentarthurdent on July 19, 2012 at 1:41 PM

RWM, what do you call that?

Schadenfreude on July 19, 2012 at 1:23 PM

Lucky Pierre

Resist We Much on July 19, 2012 at 1:45 PM

“Allowing all of the tax rates to rise would push the US into recession:”

Hello, we are in a DEPRESSION. What comes after that?
Recession my arse. “Jobless recovery?” WTH kind of BS double speak is that?

sablegsd on July 19, 2012 at 1:47 PM

Mr. President just needs a big red nose and some giant shoes to complete his clown act.

scalleywag on July 19, 2012 at 1:50 PM

Salahuddin on July 19, 2012 at 1:26 PM

When I see the spending cuts promised for that tax raise we’ll negotiate on a new tax raise. You owe us 30 years of spending cuts.

chemman on July 19, 2012 at 1:51 PM

Clearly, Obama has prioritized re-election over the fragile economy.

I know the guy has to campaign, but does he ever go to work? Who’s running the asylum??

He will say anything, lie about anything for his re-election.

bluealice on July 19, 2012 at 1:52 PM

bluealice on July 19, 2012 at 1:52 PM

I think Valerie Jarrett is the in house POTUS…Dear Leader is in charge of fund raising and PR…his golf handicap has also improved the last four years.

d1carter on July 19, 2012 at 1:56 PM

Do you have any facts disputing what I said?
 
Salahuddin on July 19, 2012 at 1:30 PM

 

Only what the CBO and President Obama’s financial advisers determined.
 
rogerb on July 19, 2012 at 1:38 PM

 
Oh, and I forgot to say “and the Federal Reserve Chairman“.
 
Sorry about that. Regardless:
 
You?

rogerb on July 19, 2012 at 2:01 PM

Two months ago, the Congressional Budget Office issued a stark warning to Congress over the fiscal impact of “Taxmageddon,” the upcoming expiration of the Bush-era tax rates at the end of this year. Allowing all of the tax rates to rise would push the US into recession:
===============

Some more Facts!!

List of U.S. states by unemployment rate

Statistic set below: June 15, 2012 for May 2012

http://en.wikipedia.org/wiki/List_of_U.S._states_by_unemployment_rate
———————————————————————

Excellent: All GOP Governors Elected in 2010 Reduced Unemployment
Jul 08, 2012 10:08 AM EST
=========================

Some awesome news: all 17 states that elected a Republican governor in 2010 has seen a reduction in their unemployment levels. In just over a year and a half since those new executives took office, these states have seen some serious improvement:

Kansas – 6.9% to 6.1% = a decline of 0.8%

Maine – 8.0% to 7.4% = a decline of 0.6%

Michigan – 10.9% to 8.5% = a decline of 2.4%

New Mexico – 7.7% to 6.7% = a decline of 1.0%

Oklahoma – 6.2% to 4.8% = a decline of 1.4%

Pennsylvania – 8.0% to 7.4% = a decline of 0.6%

Tennessee – 9.5% to 7.9% = a decline of 1.6%

Wisconsin – 7.7% to 6.8% = a decline of 0.9%

Wyoming – 6.3% to 5.2% = a decline of 1.1%

Alabama – 9.3% to 7.4% = a decline of 1.9%

Georgia – 10.1% to 8.9% = a decline of 1.2%
________________________________________________

http://townhall.com/tipsheet/katehicks/2012/07/08/excellent_all_gop_governors_elected_in_2010_reduced_unemployment

canopfor on July 19, 2012 at 2:13 PM

The reason, the study notes, is that these states have higher shares of wealthy taxpayers than the rest of the country.

These states also TARGET the wealthy with higher taxes. Guess Barry doesn’t care that he’ll milk them before the states get their turn.

GarandFan on July 19, 2012 at 2:20 PM

The reason why we have the capital to seize for building roads, bridges, and other infrastructure is because of the wealth created by free markets.

That’s a lie, Ed. Everyone knows that the wealth comes from Obama’s stash.

BuckeyeSam on July 19, 2012 at 2:26 PM

Thank goodness I’ve been cashing out my investments and organizing them over the past few years…

I’ve got $20,000-50,000/year paid in taxes at 15% on my LTCG, and right now I’m at negative $13,000 from my basis.

If you make the rate 24.7% or more I’ll hold what I’ve got until I retire… in 20-25 years and you won’t see a red cent of taxes on that for decades.

Once I’ve retired and I’m not working, I’ll sell 30-40,000/year and pay 15% or less in taxes on that income (as that will be my only income). But I won’t move money to pay you more than that.

So nothing for 25 years, and a lower rate after that. And a stagnant Stock market as millions of other investors do the same.

Good plan. If your goal is to get less tax receipts for the government, and a slower economy to boot.

gekkobear on July 19, 2012 at 2:36 PM

Tell that to St. Reagan who in 1982 during a recession signed $100 billion tax hike—the largest tax increase since World War II.

Salahuddin on July 19, 2012 at 1:26 PM

Right, we had a huge deficit, the Democrats promised spending cuts if we raised taxes, we raised taxes; raised spending MORE and the deficits went UP.

Then Bush Sr (read my lips), we had a huge deficit, the Democrats promised spending cuts if we raised taxes, we raised taxes; raised spending MORE and the deficits went UP.

But now we have a huge deficit and Democrats promise if we raise taxes they’ll cut spending and lower the deficit.

You can trust them Charlie Brown, surely you’ll get to kick the football this time, they wouldn’t be lying to you AS THEY HAVE EVERY OTHER TIME.

Nope, not buying it. Cut spending first, not last. Your side has cheated on this deal both times it has been done in the past; I see no reason to let you go 3 for 3 lying to get your way and screwing over the economy.

But feel free to explain why we can trust you this time when you’ve failed to meet your promises the last two times we tried.

gekkobear on July 19, 2012 at 2:39 PM

Nice article Ed.

The smartest man in history does get some good advice, every POTUS does. He just chooses to ignore it.

Steve Jobs told the Shizhu-Slayer that he’d love to build Apple products in the US if he would slash the onerous amount of regulation involved in setting up a manufacturing base here. The Mastiff-Masticator apparently looked uncomfortable and muttered something about being late for golf.

(covered in Job’s official biography)

CorporatePiggy on July 19, 2012 at 3:07 PM

“But Ann Romney is a lying gold-digger! HAHAHAHAHAHAHAHAHA!”

-inthemiddle

Bishop on July 19, 2012 at 12:48 PM

lol, lowereastside also tried calling her a gold-digger the other day. When I reminded her that the rich evil corporation that Ann’s father founded and built beginning in 1946 still exists today and is bigger than ever, she stopped wanting to play.

Del Dolemonte on July 19, 2012 at 3:08 PM

canopfor on July 19, 2012 at 2:13 PM

Wow, that’s HUGE change in Michigan !! Cool !
Family still there tell me some libs are actually (begrudgingly ??) feeling the overwhelming crush of the Dem years, and agreeing to GOP ideas, since things couldn’t really get any worse.
Happy for them, there, and a glorious turnaround in that state would be AWESOMELY AWESOME !!

pambi on July 19, 2012 at 3:09 PM

bayam!

Here, squirrel, squirrel, squirrel…

Del Dolemonte on July 19, 2012 at 3:12 PM

The reason why we have the capital to seize for building roads, bridges, and other infrastructure is because of the wealth created by free markets.

And not to mention, the reason we need the infrastructure is because of the expansion of trade, communication and travel created by the free market and necessary to serve the free market.

UnrepentantCurmudgeon on July 19, 2012 at 3:12 PM

I am really starting to dig, the You didn’t make that happen – you didn’t build that business meme.

Dr Evil on July 19, 2012 at 3:14 PM

Study shows…
How about FACTS showed that when we had the same tax rates that President Obama is proposing our economy was booming, the rich were getting richer, the deficit..oh wait a minute? there was no deficit. We had a surplus. The 2001 and 2003 tax cuts were never meant to be permanent they were temporary that’s why they had an expire date.
Now all we have to do is do nothing. All the tax cuts have to expire for everybody, not just the high earners. We cannot afford them.

Salahuddin on July 19, 2012 at 1:00 PM

Reid, get back to work not passing a budget and giving our country away peice by peice through treaties and appointing communist judges.

You need to earn that lifetime million dollar a year pension and “seperate but equal” healthcare plan you have.

acyl72 on July 19, 2012 at 3:40 PM

Clearly, Obama has prioritized re-election over the fragile economy. Why else would he talk about raising taxes as the economy slides toward recession, and the fiscal cliff guarantees one?

Two words…….Cloward – Piven.

kakypat on July 19, 2012 at 4:06 PM

Via Andy Garcia: “America never needed transformation in the first place, and we certainly never needed Barack Obama. This is precisely why he cannot destroy us, despite his best efforts or missteps; we have too much going for us. After all, where else could a man who never actually held a real job, who talks of saving humanity in general while never having ever saved anyone in particular, whose life is so shrouded in mystery as to be a work of fiction — where else could this man become president?”

Could not believe this came from a Hollywood type.

samazf on July 19, 2012 at 5:59 PM

Via Andy Garcia: “America never needed transformation in the first place, and we certainly never needed Barack Obama. This is precisely why he cannot destroy us, despite his best efforts or missteps; we have too much going for us. After all, where else could a man who never actually held a real job, who talks of saving humanity in general while never having ever saved anyone in particular, whose life is so shrouded in mystery as to be a work of fiction — where else could this man become president?”

Could not believe this came from a Hollywood type.

samazf on July 19, 2012 at 5:59 PM

Garcia’s been a conservative for some time. He made a movie years ago about the revolution in Cuba which was largely panned by the liberal glitterati because it told the truth about Castro and his predecessor.

slickwillie2001 on July 19, 2012 at 6:27 PM

bayam!
 
Here, squirrel, squirrel, squirrel…
 
Del Dolemonte on July 19, 2012 at 3:12 PM

 
Hopefully. I’m still waiting to be told how an 8% increase in the cost of imported components will encourage job creation in the U.S.
 
But I’m guessing this thread is dead. Who knows, maybe we can at least get some news about a Fox poll or something…

rogerb on July 19, 2012 at 7:01 PM

How about FACTS
Salahuddin on July 19, 2012 at 1:00 PM

1982 TAFRA was a deal between Reagan and Dem controlled Congress (both houses) to close loopholes and delete future tax rate increases in return for $3 in cuts for every $1 in resultant tax increase.
Top marginal tax rates:
1971-80 – 70%
1981 – 69.13%
1982-86 – 50%
1987 – 38.5%
1988-89 – 28%
1990-92 – 31%
1993-2000 – 39.6%
2001-02 – 38.6%
2003-12 – 35%
In 1982 the top marginal tax rate was also significantly reduced. Revenues went up, but the Dems controlling Congress violated their agreement and increased spending – overriding Reagan’s veto of the budget bill that did that.
So look at those years and tell me again when it was we had a good economy and increased revenues.

dentarthurdent on July 19, 2012 at 9:40 PM

Speed reading. I’m sure I’ve missed much of the nuance.
A little comedic light, for our souls, and just plain hard facts.
Bless you all. I am fortunate to be very busy — with pay!
Spread all of your thoughts to the non-choir. That’s the challenge.

And, I think if Mitt can hold the ball or score, over and over…
That’s football, American.
Pummel this useless cabal.

Actually, I do think carpet bombing is in order. Destroy with their own lies.

Still, the non-choir.

mickytx on July 20, 2012 at 12:59 AM

The truth of the matter is the D.o.D budget this year is $646 billion, up from …
 
Salahuddin on July 19, 2012 at 11:09 PM

 
Dead thread here, though.
 

Do you have any facts disputing what I said?
 
Salahuddin on July 19, 2012 at 1:30 PM

 
Last post, answered, ignored (fled?).
 
Well played, and thanks for letting us know for the future.

rogerb on July 20, 2012 at 4:56 AM