Obama to Propose $1.5 TRILLION in New Taxes (Is the Man Insane? Can’t He Just STOP Spending Money?)

WASHINGTON (AP) — President Barack Obama will propose $1.5 trillion in new taxes as part of a plan to identify more than $3 trillion in long-term deficit reduction and slow the nation’s escalating national debt.

Obama’s tax plan is aimed predominantly at the wealthy and draws sharp contrasts with congressional Republicans.

It comes just days after House Speaker John Boehner ruled out tax increases to lower deficits. It also comes amid a clamor in his own Democratic Party for Obama to take a tougher stance against Republicans. And while the plan stands little chance of passing Congress, its populist pitch is one that the White House believes the public can support.

The core of the president’s plan totals just more than $2 trillion in deficit reduction over 10 years. It combines the new taxes with $580 billion in cuts to mandatory benefit programs, including $248 billion from Medicare.

The administration also counts savings of $1 trillion over 10 years from the withdrawal of troops from Iraq and Afghanistan.

The deficit reduction plan represents an economic bookend to the $447 billion in tax cuts and new public works spending that Obama has proposed as a short-term measure to stimulate the economy and create jobs. He’s submitting his deficit fighting plan to a special joint committee of Congress that is charged with recommending deficit reductions of up to $1.5 trillion over 10 years.

In a defiant note, administration officials made clear Sunday that Obama would veto any Medicare benefit cuts that aren’t paired with tax increases on upper-income people.

Officials cast Obama’s plan as his vision for deficit reduction, and distinguished it from the negotiations he had with Boehner in July as Obama sought to avoid a government default.

As a result, it includes no changes in Social Security and no increase in the Medicare eligibility age, which the president had been willing to accept this summer.

Moreover, the new tax revenue Obama is seeking is nearly double the $800 billion that Boehner had been willing to consider in July. Republicans were already lining up against the president’s tax proposal before they even knew the magnitude of what he intended to recommend.

“Class warfare may make for really good politics but it makes for rotten economics,” GOP Rep. Paul Ryan of Wisconsin, the House Budget Committee chairman, said Sunday in reaction to one Obama tax proposal to impose a minimum tax rate on wealthy filers.

From:  http://hosted.ap.org/dynamic/stories/U/US_OBAMA_DEFICITS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-18-23-33-29

 

Thanks, Obama! Debt Now Equals Total U.S. Economy

President Obama projects that the gross federal debt will top $15 trillion this year, officially equalling the size of the entire U.S. economy, and will jump to nearly $21 trillion in five years’ time.

 

Amid the other staggering numbers in the budget Mr. Obama sent to Congress on Monday, the debt stands out — both because Congress will need to vote to raise the debt limit later this year, and because the numbers are so large.

 

Mr. Obama‘s budget said 2011 will see the biggest one-year jump in debt in history, or nearly $2 trillion in a single year. And the administration says it will reach $15.476 trillion by Sept. 30, the end of the fiscal year, to reach 102.6 percent of gross domestic product (GDP) — the first time since World War II that dubious figure has been reached.

 

In one often-cited study, two economists have argued that when gross debt passes 90 percent it hinders overall economic growth.

 

The president’s budget said debt as a percentage of GDP will top out at 106 percent in 2013, but only if the economy booms.

 

“I still don’t see a sense of urgency from the president about the massive federal debt,” said Sen. Lamar Alexander, Tennessee Republican. “His budget calls for too much government borrowing – even though the debt is already at a level that makes it harder to create private-sector jobs.”  

Thanks, Obama! New Budget is $1.5 Trillion Tax Hike Over 10 Years!

President Obama released his budget this morning.  Rather than focusing on Washington’s over-spending problem, the budget calls for higher taxes on families and small businesses to pay for even more government spending. 

 

Under the Obama budget, tax revenues will grow from 14.4% of GDP in 2011 to 20% of GDP in 2021.  By comparison, the historical average is only 18% of GDP.

 

Tax hike lowlights include:

 

•Raising the top marginal income tax rate (at which a majority of small business profits face taxation) from 35% to 39.6%.  This is a $709 billion/10 year tax hike

 

•Raising the capital gains and dividends rate from 15% to 20%

 

•Raising the death tax rate from 35% to 45% and lowering the death tax exemption amount from $5 million ($10 million for couples) to $3.5 million.  This is a $98 billion/ten year tax hike

 

•Capping the value of itemized deductions at the 28% bracket rate.  This will effectively cut tax deductions for mortgage interest, charitable contributions, property taxes, state and local income or sales taxes, out-of-pocket medical expenses, and unreimbursed employee business expenses.  A new means-tested phaseout of itemized deductions limits them even more.  This is a $321 billion/ten year tax hike

 

•New bank taxes totaling $33 billion over ten years

 

•New international corporate tax hikes totaling $129 billion over ten years

 

•New life insurance company taxes totaling $14 billion over ten years

 

•Massive new taxes on energy, including LIFO repeal, Superfund, domestic energy manufacturing, and many others totaling $120 billion over ten years

 

•Increasing unemployment payroll taxes by $15 billion over ten years

 

•Taxing management capital gains in an investment partnership (“carried interest”) as ordinary income.  This is a tax hike of $15 billion over ten years

 

•A giveaway to the trial lawyers—not letting companies deduct the cost of punitive damages from a lawsuit settlement.  This is a tax hike of $300 million over ten years

 

•Increasing tax penalties, information reporting, and IRS information sharing.  This is a ten-year tax hike of $20 billion.

 

Add it all together, and this budget is a ten-year, $1.5 trillion tax hike over present law.  That’s $1.5 trillion taken out of the economy and spent on government instead of being used to create jobs.

 

The “tax relief” in the budget is mostly just an extension of present law, and also some refundable credit outlay spending in the tax code.  There is virtually no new tax relief relative to present law in the President’s budget.

 

From:  http://www.atr.org/obamas-fy-budgetbr-taxes-more-a5844#