Veep

The Difference Between Me and a Great Speaker...

As always, Mr. Obama makes my previous post look like amateur hour.

"Lately, [McCain] and Governor Palin have actually accused me of -- get this -- socialism. John McCain just repeated the charge again this morning. And you know why? Because I want to give a tax cut to the middle class -- a tax cut to 95% of American workers. These are folks who work hard every single day and get payroll taxes taken out of their paycheck every single week. These are the teachers and janitors who work in our schools. They're the cops and firefighters who keep us safe. They're the waitresses who work double shifts, the cashiers at Wal-Mart, the plumbers fighting for the American Dream. John McCain thinks that giving these Americans a break is socialism. Well I call it opportunity, and there is nothing more American than that.

"If John McCain wants to talk about redistributing wealth to those who don't need it and don't deserve it, let's talk about the $700,000 tax cut he wants to give Fortune 500 CEOs, who've been making out like bandits -- some of them literally. Let's talk about the $300 billion he wants to give to the same Wall Street banks that got us into this mess. Let's talk about the $4 billion he wants to give oil companies like Exxon-Mobil or the $200 billion he wants to give the biggest corporations in America. Let's talk about the 100 million middle-class Americans who John McCain doesn't want to give a single dime of tax relief. Don't tell me that CEOs and oil companies deserve a tax break before the men and women who are working overtime day after day and still can't pay the bills. That's not right, and that's not change.

"I promise you this -- not only will the middle class get a tax cut under my plan, but if you make less than $250,000 a year -- which includes 98 percent of small business owners -- you won't see your taxes increase one single dime. Not your payroll taxes, not your income taxes, not your capital gains taxes -- nothing. That is my commitment to you.

95%

Yesterday evening I got together with a wonderful group of people for a Minnesota fall tradition, a potluck dinner/bonfire. There was plenty to eat, plenty to drink and plenty of discussion on where this country is headed. Inevitably the conversation turned to the current election as hard as we all tried to stay away from the topic. Being a proud lower middle class Democrat, I was vastly outnumbered by most of my Republican leaning friends. There was genuine fear among these good people about what would happen under an Obama presidency. After we talked over each other about the rhetorical garbage such as Bill Ayers, McCains robocall campaign, Palins qualifications (or lackthereof), etc... The conversation turned to real policy, specifically the Obama plan of raising taxes on the richest 5% in the country while reducing taxes or keeping levels the same on the other 95%. We discussed how 40% of people in this country "don't pay taxes". I brought up the fact that within this 40%, these people pay the payroll tax which is, in fact, a tax. They brought to my attention that these people get most of their payroll taxes back at the end of the year. While this is somewhat true, my argument was that while some of these people got this money back, it's directly due to the fact that they are probably the most in need of it. We then turned to how Mr. Obamas tax plan will horribly harm the small and medium businesses by directly affecting their ability to hire, pay benefits, match retirement plans, etc... While this certainly sounds good on paper, I would offer up this comeback (which I didn't get a chance to effectively make as my friends daughter fell down the stairs. (She was ok).
Let's say Business "A" is a medium size business with 50 employees, and hovers around the 250,000 dollar amount that Mr. Obama has said he will tax back up to Clinton-era levels of taxation. In effect, a repeal of the Bush tax cuts. Their agrument is that they would have to lay off a certain percentage of their staff to pay for these tax increases. Again, this sounds reasonable, but I certainly don't agree. To me there's something important this argument misses. Let's say Mr. Obama does what he says, and cuts or keeps even taxes for those making less 250,000/year, the "95%" as the campaign keeps referring to. It seems to me that the more taxes are cut for this 95%, the more capital they have to work with. They have more money to spend on groceries, clothes, vacations, cars, home improvements, etc... at any rate, goods and services. Isn't this what truly makes a free market economy run? I would venture to say that by going back to Clinton level tax rates, we could keep unemployment at record lows, again due to the boom that this "95%" would be spending. The more people are spending, the more money Business "A" makes and the more people they need to hire to keep up. "Trickle UP Economics". Regardless of what you thought about the Clintons and all their problems, only the most biased right wing observer could say that the Clinton economy was something to avoid. Is it only me who sees this? Why would we want 95% of people to have higher tax rates effectively reducing their purchasing power at a time when we truly need this 95% out there buying goods and services?