Instead of coming together like past generations did to build a better country for our children and grandchildren, their argument is that we should let insurance companies go back to denying care for folks who are sick, or let credit card companies go back to raising rates without any reason. Instead of setting our sights higher, they’re asking us to settle for a status quo of stagnant growth and eroding competitiveness and a shrinking middle class.
The argument is that we should not have socialized medicine, and while the insurance industry regulations need to be revisited, it was not necessary, and it is an unwise policy to replace the entire health care structure. Most Americans agree with this. Obama’s and liberals’ answer to everything is more government control and/or more government spending. I haven’t heard any conservatives “asking us to settle for a status quo of stagnant growth and eroding competitiveness and a shrinking middle class.” Those are precisely the things Obamanomics are bringing us through higher taxes, over-regulation, bailouts and government takeovers. If government would simply get out of the way, a free market would very soon restore prosperity.
“Past generations” felt compelled to support the big government policies of FDR during the Great Depression, which vastly expanded government size and power, and contributed to worsening and prolonging the Depression. (See my previous article here.)
With all the other budgetary pressures we have – with all the Republicans’ talk about wanting to shrink the deficit – they would have us borrow $700 billion over the next 10 years to give a tax cut of about $100,000 each to folks who are already millionaires. And keep in mind wealthy Americans are just about the only folks who saw their incomes rise when Republicans were in charge. And these are the folks who are less likely to spend the money – which is why economists don’t think tax breaks for the wealthy would do much to boost the economy.
“Economists” in that last sentence must refer to Keynesian economists who think the only solution to our economic problems involve massive government spending. Obama shows his narrow outlook on this situation when he says the wealthy are “less likely to spend the money.” If they did receive a continuation of the Bush tax cuts, they would be very likely to spend the money on business investment that would create jobs.
How they can still get people to believe the following myths is somewhat surprising:
Myth #1: The Bush tax cuts decreased, and continuation of them would decrease revenues to the government. Not so. Check tax cuts back to JFK, Reagan, and Bush, and you will find that revenues to the government increased under these tax cuts. Revenues would increase again if all the Bush tax cuts were extended. Boehner’s suggestion of extending all the Bush tax cuts for two years, and rolling back spending to 2008 levels, would produce a substantial improvement quickly. If businesses knew their tax rates were frozen for two years, they would feel free to expand and hire.
Myth #2: Increasing taxes on the wealthy does not harm others in society. Not so. Increasing taxes on the wealthy equals increasing taxes on those who are in a position to provide jobs, if the economy encouraged it. Figures from the Bureau of Labor Statistics show clearly that this isn’t happening now. Obama’s argument appeals mainly to class envy.
This isn’t to punish folks who are better off –- God bless them. It’s because we can’t afford the $700 billion price tag... And for those who claim that our approach would somehow be bad for growth and bad for small businesses, let me remind you that with those tax rates in place, under President Clinton, this country created 22 million jobs and raised incomes and had the largest surplus in our history.
Jobs were created and the surpluses happened after Republicans gained control of Congress in 1994. Clinton and Gore got on board with this reality, announcing that “the era of big government is over,” something that Obama would never do. For him, the era of big government is just beginning. And, punishing some of the wealthy by redistributing some of their wealth would please Obama.
As Jake Tapper of ABC News reported,
The president defined the Republican economic philosophy as, “Cut taxes, especially for millionaires and billionaires. Cut regulations for special interests. Cut trade deals even if they didn’t benefit our workers. Cut back on investments in our people and our future.” “Millionaires, billionaires, and special interests” means employers, whose wealth and income Obama wants to redistribute. Of course, here, as elsewhere, when Obama says “investment,” he means “government spending.”
Senate Republican Leader Mitch McConnell in a statement pushed back against Mr. Obama’s speech.
“If the President wanted to have an immediate impact on hiring, he could begin by changing his mind and announcing today his opposition to the job-killing tax hikes on small businesses,” McConnell said, “ America’s job creators have already been hit with higher health care costs and related taxes, new bureaucracy and a financial regulation bill. Americans want jobs, not more government, more debt and more taxes. Let’s start today with a declarative statement against tax hikes on the small businesses that are critical to expand and create jobs.” And, Obama would have us believe that it’s somehow John Boehner’s fault that our economy is in such dreadful condition.
The President derided House Minority Leader John Boehner as representing simply saying “no” to Obama’s policies without proposing any positive steps to helping the economy. Not true, of course, but the “no” aspect is valuable too. As one of Jake Tapper’s commenters said,
No is a pretty sound position when the nation is careening off a cliff in massive debt.
America is on a path to bankruptcy. This is no longer news and no longer debatable. What remains in question is, what are we going to do about it? Interestingly, The Hill is reporting today (09/08/2010) that momentum is building for extending all the Bush tax cuts, since the President avoided a direct veto threat, and Sen. Ben Nelson (D-Neb.) expressed support for extending them:
Sen. Ben Nelson (Neb.), a centrist who has been a key vote on several Obama administration initiatives, said Thursday that he supports extending all of the George W. Bush-era tax cuts until the economic recovery has taken root. Raising taxes on wealthier taxpayers could hurt the economy, he said….
Tax policy experts expect Congress to approve an extension of all of the Bush-era rates in a lame-duck session after the elections. 
 Items in bold are from “Remarks by the President on the Economy in Parma, Ohio,” 09/08/2010, WhiteHouse.gov.
 Jake Tapper, “Still Fear vs. Hope? Obama Attacks John Boehner, GOP’s Economic Vision,” 09/08/2010, ABC News, Political Punch.
 Commenter “Skip” at Tapper article 09/08/2010. See .
 Vicki Needham and Ian Swanson, “Momentum builds for extending all of President Bush’s tax cuts,” 09/09/10, The Hill, On the Money blog.
Photo: Senator Ben Nelson of Nebraska, official portrait, via Wikipedia.