For Democrats Bad Politics Trumps Good Policy As They Struggle To Hold On To Power
On Wednesday, by a vote of 256-171, the Republican led House of Representatives approved extending the so-called Bush-era tax cuts for another year. That vote came a month after the liberal led U.S. Senate passed President Obama’s proposal to deny extending those tax cuts to those who make more than $250,00. a year. The scenario has assured us that the stage is set for Democrats to play out a liberal theme that is critical to their reelection strategy —– class warfare. These political circumstances made the Republicans vote to extend the tax cuts to all, a courageous and principled stand. Had the G.O.P. agreed with the liberal proposal to extend the cuts for some but not for others, they might have denied the President and his Party the rhetorical fuel behind his class warfare strategy. But rather than succumb to electoral politics, Republicans decided to give the economy and the American people a hand and remained true to the mission of getting our economy on track while knowing full well that they would be giving the left ability to exploit the G.O.P.’s position.
On the flip-side, Democrats had the opportunity to put good policy ahead of partisan politics but decided instead to put their reelection hopes ahead of the American people’s hope for a more stable economy and a brighter future. That decision amounted to the left giving the economy and the American the finger.
To understand how the liberal legislative initiatIve to deny a full extension of the tax cuts is driven more by a Democratic desire to create a reelection strategy than to enact actual solutions that will improve our economy, one must accept the truth about our current economic circumstances, our nation’s existing tax structure, and they must accept the findings of history.
First, it must be understood that in 2010, when the Bush tax cuts were first set to expire , President Obama agreed that the nearly stagnant economy which was experiencing a dismal growth rate of just 2.3%, could not withstand the burdens of an increase in taxes. He and his Party agreed that any higher tax burden would have a debilitating effect on the already troubled economy. Yet over a year later, even though our economic growth rate is even worse than it was in 2010, Democrats are suddenly trying to argue that our now even weaker economy can withstand the burdens of an increase taxes.
Rather than explaining this change of mind with any substance to support the new direction, President Obama has quite creatively interjected Bill Clinton into the election by trying to have us believe that our current economy can withstand the same tax rates that it had when Bill Clinton controlled the White House. The problem with that suggestion is that when Bill Clinton was President, the economy was booming, thanks in large part to ridiculously rapid growth in the dot com industry and the unsustainable growth of an emerging housing bubble which has since burst and ushered in the Great Recession we are still coping with. Now faced with that recession, the economy is not growing at rate that is fast enough to allow taxpayers to properly absorb the additional impact of any increased tax burden.
However the President and the majority of those in his Party seem unwilling to acknowledge those facts. In order to latch on to their electoral strategy of class warfare, Democrats are unwilling to acknowledge any of the facts which contradict the rationale behind raising taxes during this economic crisis. Instead, they choose to pursue to divide Americans by pitting those who are struggling against those who are comfortable through the use of leftwing rhetoric intended to make some resent others. And while the rhetoric behind the left’s strategy is rich, the reality is that the rich already pay more than their so-called fair share. While the average tax rate for those who are considered wealthy is 30 percent, it is 15 percent for the middle class. But if that wasn’t enough to dispel the foundations of liberal mythology, the IRS confirms that the top 1 percent of income earners pay 40 percent of all federal income taxes, while the top 5 percent pay 60 percent and the wealthiest 10 percent in America pay 70 percent of the entire federal tax burden. America’s richest 10 percent happen tp pay a share of the tax burden that is far greater than what the same top 10 percent pay in many developed countries, such as Canada, the U.K., and even in those models of European socialism, France, and Germany. Yet liberals argue that this is still enough.
These are facts which seem to have been deleted from liberal talking point memos.
Also ignored ignored by the left is that 47 percent of the U.S. population pays no federal income tax at all. And if that was not enough, according to the Joint Committee on Taxation, more than half of those filing a return receive more cash from the IRS than they pay in income taxes and payroll taxes combined.
So what exactly is the left and President Obama talking about when they demand that the rich pay their fair share when the statistic beg the question —– who really needs to pay their fair share?
As if this was not enough, the glaring lack of logic behind the left’s current position on the Bush tax cuts becomes even more pronounced when one considers the history of tax cuts and the economy.
In the 1920’s, President Warren G. Harding launched an economic boom after he initiated a series of tax cuts that led to an influx of private sector investments. Of course Harding did two things at the same, something which seems impossible for today’s political class to do. In addition to cutting taxes, President Harding adopted disciplined spending reductions. Those reductions made him the only postwar President to reduce federal spending to a point that was below prewar levels and when all was said and done Harding’s tax cuts resulted in a more than 61% increase of federal revenues that went from $719 million in 1921, to $1164 million in 1928.
In the 1960’s the Kennedy tax cuts which were not enacted until 1964, more than a year after his assassination, reduced the top marginal rate from an absurd 91% to a somewhat less absurd 70%. This took federal revenues from $301.19 billion in 1965, to $463.84 billion in 1969 and it led to a boost in private sector investment in the free market that allowed businesses to grow, Americans to find jobs, and our economy to grow. Quite interestingly, when proposing his cuts, President Kennedy stated the following;
“Our true choice is not between tax reduction, on the one hand, and the avoidance of large Federal deficits on the other. It is increasingly clear that no matter what Party is in power, so long as our national security needs keep rising, an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.”
Such thinking is a far cry from that of the incumbent President.
More than two decades later Ronald Reagan applied that same Kennedy philosophy by adopting the Economic Recovery Tax Act of 1981 and the Tax Reform Act of 1986. In 1981 Reagan’s initiative phased-in a 23% cut in individual tax rates and dropped the top rate from 70% to 50%. In ’86 his cuts took the top marginal rate from 50 to 28 percent. Between those tax reductions and a steady stream of deregulation, Reagan avoided America’s following of Western Europe into the welfare-state decline that we find ourselves confronting today under President Obama. Reagan’s economic policies also spurred economic growth, increased private sector investment, created jobs growth, stemmed the rapid pace at which the government was growing prior to his taking office and brought our nation out from under the Days of Malaise delivered to us under President Jimmy Carter.
The most recent major tax cuts were the Bush era reduction which included three major tax cuts. The 2001 tax cut which we are now debating the extension of, created a new 10% individual tax rate and phased in the lowering of individual tax rates. It also phased in an increase in the child tax credit, marriage penalty relief provisions, an increase of the estate tax exemption, an increase in the IRA contribution limit, and the repeal of limits on itemized deductions and personal exemptions. The 2002 tax cut was chiefly aimed at business, creating 30% expensing for certain capital asset purchases, and increasing the carryback of net operating losses to 5 years. In 2003 additional Bush tax cuts lowered
the top individual income tax rate on dividends and capital gains and accelerated most of the phased-in provisions of the 2001 tax cut. The results of the 2001 cuts quickly stimulated the economy out of the recession we were in ans spurred on the moderate growth of 2002 and 2003. As a result of all three Bush tax cuts, until the housing and banking crises which ushered in the arrival of the recession in December 2007, millions of families and businesses thrived, at least in part because of the lower tax burden.
All of this historical evidence contradicts the current course being proposed by President Obama and his Party who today are trying to convince us that raising taxes will achieve the same positive results which cutting taxes have achieved.
It is all a part of the liberal political strategy that Democrats are employing in order to maintain control of government. By refusing to accept a full extension of the Bush era tax cuts, President Obama is assuring himself and his Party of the perfect opportunity to wage a reelection campaign that will be based on the only shred of hope they have left. The hope that President Obama and his Party can win or maintain some power by dividing Americans through class warfare.
For Democrats, as was proven in the 2010 midterm elections, it is clear that they can not run on their record. A President’s reelection and often the fate of his Party, is always a referendum on their current term in office, a fact which is responsible for the perpetual state of fear that is driving the class warfare strategy of President Obama and his liberal colleagues in Congress. What else can they run on?
Peace in the Middle East?
I think not.
Maybe at the next Gay Pride Festival in New York or California but no one is contesting the Electoral College votes in those states.
Can the left campaign on Obamacare?
They will try to, but with approval ratings that are lower than the President’s, Obamacare is not exactly the winning issue for Democrats and they know it.
Can Democrats and the President run on their record?
According to the numbers, our nation is teetering upon a double dip-recession or perhaps even that very same depression which President Obama contends his policies averted. The record shows that the national unemployment rate is well above 8.0% for the 40th consecutive week. Contrast that with George W. Bush whose highest monthly average unemployment number prior to the late 2008 financial crisis was 6.3 percent and who’s overall monthly average unemployment rate over his two terms was 5.3 percent.
Making matters worse, the record of President Obama and Democrats shows that when it comes to Hispanics, the unemployment rate is 11%, and for African-Americans it is 14.4%, a number that is actually good when you consider that the unemployment rate for African-American youth stands at 50%. Even more disturbing is that when you add up all those in the population who have given up and dropped out of the workforce, and are not being counted by the federal government anymore, the real unemployment rate is in excess of 14.9%. In just one month alone an unprecedented record 1.2 millionpeople dropped out of the labor force.
This is not a record to run on. It is a record to run from, and with the help of a class warfare strategy, liberals hope they can distract Americans from that record and avoid being held accountable to it.
It is a Hail Mary Pass campaign strategy that the President and his Party must turn to as a last resort to.
For Democrats the hope is that the average American is so beaten down that they are willing to make the most successful among us a scapegoat for their frustrations. Democrats have turned that hope in to a political strategy, a divide and conquer strategy which President Obama has incorporated into his reelection by proposing to raise taxes on those who create jobs and by using catch phrases such as “pay their fair share” and “they didn’t build that”. It is a strategy that avoids any attempt to appeal to common sense and decency and is instead designed to appeal to the less noble side of humanity, the side that wallows in the ugly and unproductive depths of greed and envy. It is also a strategy that tries to denies the truth and avoid reality.
More than two decades ago, Ronald Reagan spoke of America as a shining city on a hill. 24 years later, Barack Obama has taken that shining city and placed it precariously on the edge of a cliff that is being quickly eroded by a steady flow high unemployment, out-of-control government spending, continued economic uncertainty, and excessive taxation. This surge of damaging economic factors is eating away at our economic foundation as steadily as the circulating ground waters that dissolve rock and earth to create massive sinkholes, and in this case that sinkhole will reveal itself in the form of a double-dip recession and the possibly entry of our nation in to the next Great Depression.
But despite the undeniably obvious warning signs, Democrats have made a conscious decision to forego the implementation of solutions in order to develop a deceptive, last ditch, reelection strategy. Instead of following historically proven solutions to our problems, President Obama and his Party have decided to aid the corrosive flow of debilitating forces that are creating this pending economic sink hole by rejecting solutions in favor of a reelection strategy that is based on a 3D liberal approach to politics that involves distracting voters from the record that liberals have established, distorting the record of their opposition, and dividing Americans by pitting them against one another.
If this strategy will work has yet to be seen but for it to be successful, the American people will have to be willing to turn down the hand that Republicans are offering them in favor of the finger that the left is giving them when they think voters are not paying attention..
Filed under: About the Candidates, President Obama | Tagged: Anthony Del Pellegrino, Bush era tax cuts, class warfare startegy, Democrats giving voters the finger, extending the bush tax cuts, history of tax cuts, kempite, Mitt Romney for President, obama class warfare strategy, obama reelection strategy, The presidential election, White House 2012, wordpress political blogs |