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When the House voted to adjourn about a month ago by a 210-209 margin, Speaker Nancy Pelosi, D-Calif., and her cronies avoided dealing with extending the 2001 and 2003 Bush tax cuts, which expire on Dec. 31. Rather than addressing the tax issue, the Senate also voted to adjourn. Instead, Congress is holding a lame-duck session beginning Nov. 15. What that means is: Whether or not you elect them back into office, they are poised to do what they want when they want with little election fallout.
Before adjournment, 47 House Democrats endorsed a letter to Nancy Pelosi pleading for the extension of all the Bush tax cuts, and 39 of them voted against adjournment. Yet the Pelosi and powerful Washington elite got their way. And so we sit in levy limbo until after the elections.
Our Democratic representatives are no dummies, but they think you are. They’re counting on your naivete that their meeting deferment is not a temporary delay to terminate (or assure the expiration of) the Bush tax cuts. But that is exactly what it is. And they know if you figured that out, it would mean bad news for their (re-)elections, as taxes will ultimately rise for all Americans.
The truth is President Obama has called for a staggering $921 billion tax increase beginning on Jan. 1, 2011. And all Congress has to do is nothing to meet his goal – just let the Bush tax cuts expire, or at least most of them.
And so, if somehow you haven’t heard, in about 60 days, Democrats in Washington will impose a $3.8 trillion tax increase on Americans, including the loss of the $1,000 child tax credit, if Congress allows the Bush tax cuts to expire. In practical terms, the average American family will pay between $1,500 and $3,000 more per year in taxes. Thanks to the Washington think tank, Tax Foundation, you can now calculate exact amounts for your family by your state and congressional districts via their website.
It boils down to this. If Congress allows the Bush tax cuts to expire on Jan. 1, 2011, here’s your new tax bracket:
- 35-percent bracket goes up to 39.6 percent.
- 33-percent bracket goes up to 36 percent.
- 28-percent bracket goes up to 31 percent.
- 25-percent bracket goes up to 28 percent.
- 10-percent and 15-percent brackets are merged at 15 percent.
- Capital-gains rate goes from 15 percent to 20 percent.
- Dividend rate of 15 percent goes back up to 39 percent.
You have heard, however, that President Obama promises not to raise taxes on the lower and middle classes. If you assume he will keep his word, combined with the fact 47 percent of citizens pay no federal taxes at all, half of the readers of this column might feel momentarily immune to the coming increases in taxation. Unfortunately, such financial resistance will be short-lived.
Contrary to Obama’s plan, most economists (including Washington’s) share the conviction that the feds can’t fix the economy, balance their budgets, lower the national debts or deficits or pay for out-of-control entitlements by taxing only the wealthy. Costs will not only trickle down to your pocketbook as they have for years, but, mark my words, Washington’s promises will once again turn into more lies as they tax you next.
CBS even admonished, “Enjoy [lower taxes] while you can. With government spending projected to outpace revenues by $9 trillion over the next decade, today’s low tax rates can’t last, even if Congress were to find the will to cut spending. Just to eliminate this year’s budget deficit, tax rates would have to be 24 to 85 percent, not today’s 10 to 35 percent, according to the Tax Foundation, a Washington, D.C.-based think tank.”
And one more thing needs to be cleared up: Obama isn’t “cutting taxes” for those earning under $200,000 annually by simply sustaining the Bush tax cuts. That is completely misleading, as no one’s taxes are cut when you merely leave everything as it is now. Even MSNBC’s Chris Matthews rebuked the president by saying, “Stop saying cutting taxes is giving people money – it’s their money.”
Could it be merely coincidental that after nearly two years in office, just before another major election, Obama is finally promising to lower the taxes of the middle class and boost private businesses? Now, after all the borrowing from China, corporate bailouts, Fannie Mae and Freddie Mac and other wasteful spending and partisan pet projects of the past two years? Give me a break! Can you spell election propaganda?
Most economists agree that the 2007-08 financial meltdown was the result of a housing-bubble and credit crisis, which had its origin back under Clinton in the Fannie Mae and Freddie Mac frenzy. While Bush made many economic mistakes, his 2001 and 2003 tax reductions led to more than 8 million new jobs in the next five years, and the unemployment rate dropped to 4.6 percent. It’s not economic rocket science. Tax breaks encourage economic growth. Tax increases do not.
As I’ve shown in the past several articles, the federal government’s spending is out of control. All the money our government needs they already have – not one further tax is needed – only their willingness to cut their own budgets. Borrowing and spending may seem like the American way – but it wasn’t always, even in government.
If the present or past administrations haven’t been able to run our government without steeping our posterity into financial ruin, then they need to go and we need to elect those who are fiscally responsible – period. No more excuses. No more whining. No more borrowing. No more debt. No more deficits. No more taxes!
We need to elect more politicians like Gov. Rick Perry, who has lowered taxes, bolstered business, developed jobs and grown the state’s economy. (Over the last year, Texas created more than half the new jobs in the nation – 166,000 during the year ending in September – while the entire U.S. economy gained only 321,000 jobs during the same period.)
The fact is: The tax man cometh for us all, unless we cut him or her off at the pass (I mean, at the polls) by not electing or re-electing tax-increasing candidates!
You’ve shouted it loud for months, “We will remember in November!” Now, it’s time to deliver and show them how well you recollect! (For a voter guide detailing where candidates in your state stand on issues, click here.)
So go get ’em at the polls! And do it with the passion of Samuel Adams (1722-1803), the Father of the American Revolution, who said, “Let each citizen remember at the moment he is offering his vote that he is not making a present or a compliment to please an individual – or at least that he ought not so to do; but that he is executing one of the most solemn trusts in human society for which he is accountable to God and his country.”
(In my next article, I will discuss dozens of other taxes being “hidden” in legislature that will be shoved down American’s throats in the near future!)