With more than half the year gone, President Obama today finally broke his silence on Taxmageddon and thus brought a smoldering debate front and center. How? By continuing to push for raising taxes on the wealthy.
President Obama and his allies had been perfectly content to continue to allow Taxmageddon to weigh on the economy and then deal with it in some fashion in the lame duck period after the November election. He was reluctantly drawn into the debate now—not because he is trying to lead on the nation’s most important economic policy issue, stopping Taxmageddon, but because of recent dismal economic data—capped off by the June jobs report.
As the President often does, he seems to be trying to distract people from the bad economic news that reflects poorly on his policies. He’d rather focus attention on his class warfare agenda. Rather than lead, the President is reacting.
Of course, the substance of President Obama’s position is to call for avoiding tax hikes on some while raising taxes on others. The tax increase du jour is a recycled one: The President’s long-held plan to raise taxes on incomes over $200,000 ($250,000 for families).
He had offered a budget with little fanfare in February, with the same proposals to raise taxes on investors and job creators (those earning over $250,000) that he endorsed today. Earlier, he had sought a distracting debate over the so-called Buffett Rule tax hike. But otherwise, the President had been silent on the nearly $500 billion tax hike barreling down on the economy, slated for January 1 of next year.
The list of prominent economists and market shapers calling for Congress and President Obama to stop Taxmageddon now has been growing longer by the day.
House Republicans have already indicated they intended to take up legislation delaying the expiration of the 2001 and 2003 tax policies, though leaving some matters, such as the pending Obamacare tax hikes and the payroll tax hike, for another day. The Senate had signaled nothing, likely waiting on the President.
Interestingly, President Obama differs with his allies in Congress such as Senator Charles Schumer (D–NY) and House Minority Leader Nancy Pelosi (D–CA) on the definition of the “rich” who will be soaked. Schumer and Pelosi set the mark at as those making more than $1 million annually. That is five times higher than President Obama’s $200,000 mark. Apparently even they recognize the President’s plan would be too punitive on job creators—although they are still willing to stick it to the most successful job creators for the sake of class warfare.
The President has pushed for this tax increase ever since he started running for President back in 2007. It is old hat by now, and since he has failed to get it through Congress for three and a half years running, the proposal has near zero chance of prevailing now. What is surprising is that he continues pushing this unpopular, economically damaging tax increase even as the economy continues to languish. When he should be signaling to job creators Washington’s intense desire to help, instead he signals his continued antipathy toward the private sector and job growth.
President Obama’s tax increase would fall directly on small businesses, investors, and entrepreneurs—in other words, job creators. These are the very people the country needs to start creating jobs to put the 13 million Americans who are out of work today back on the job. President Obama’s tax increase would slow already stagnant job creation and make it even harder than it already is for these unemployed Americans to find work. The economy remains weak, and the President’s tax increase will only make it worse.
Once again, the House of Representatives is leading, the President is reacting with a misguided tax hike on job creators, and Majority Leader Harry Reid (D–NV) and the rest of the Senate’s leadership have yet to be heard from at all. For all this, the silver lining should not be ignored: President Obama has joined the debate to prevent Taxmageddon. Thus, it is inescapable for Reid to join in.
The economy remains weak. Preventing all of Taxmageddon—for all Americans, including job creators—should be President Obama’s top priority.