Everyone likes to be right, don’t they? I mean, to make some sort of bold accusation that later becomes fact is like winning something, and everyone likes to win. Yet, as I sit and mull over the recent news of President Barack Obama’s budget and tax plans, I can’t shake this strange feeling. I have a knot in my stomach, and frequent sighs of disappointment press themselves from my body. I should be excited. After all, I was right. However, saying, “I told you so,” just doesn’t have the effect I hoped it would. Last year, during the election campaigns, I warned my friends that Obama would oversee the largest tax increase since World War II, as well as the largest expansion of social programs since Franklin D. Roosevelt. Unfortunately for America, I was right.
At the time, I was being a little dramatic. I had no idea what Obama would accomplish if he took office. He was surprisingly vague when it came to a number of his platforms, but he promised to be bipartisan. Looking back, I see what a political genius Obama really is. He told the people exactly what they wanted to hear. Now, it would appear that he is taking action to prove what I had always been warned about him – that he is not just a liberal, but a leftist.
I don’t know all the characteristics of a leftist, but I do know the word it is used to describe an individual whose political views and actions are so far to the left that they are completely oblivious to just how ridiculous they are. With the release of Obama’s proposed taxation policy changes and the new federal budget, it is apparent he jumped straight from moderate, bipartisan Democrat to loony leftist.
Maybe using a word like loony is a bit much to describe our commander in chief, but I wanted to make the point about just how stunned I am about what he plans to do in the name of helping our economy.
First, let’s look at what changes will be made in the world of taxation. It comes as no surprise to me that Obama plans to raise taxes. After all, he is a Democrat. I do find it interesting that he has decided to set the so-called rich bar at couples making $250,000. What I mean is the “wealthiest Americans” are those couples who make a quarter of a million dollars or more per year. For those who are in the rich bracket, they get to look forward to a number of tax hikes. The top two income tax rates would increase from 33 percent to 36 percent and 35 percent to 39.6 percent, accompanied by a limit on a number of deductions and exemptions and an increased rate on capital gains and dividends. As a whole, these limits are roughly equal to another 2 percent increase in income taxes.
I have already made the point very clear that I am completely against a progressive tax system because it punishes the high earners. It would appear Obama is quite gung-ho in the opposite direction. His budget contains a minimum of $1 trillion in tax increase, which he hopes will fund his plan for socialized medicine. I believe The Wall Street Journal sums these new developments very nicely: “With $1 trillion of new entitlements, $1.4 trillion in new taxes and $5 trillion in new debt, America’s entrepreneurs aren’t getting any help soon from Washington.”
I was flabbergasted when I saw the budget Obama had established. For someone who so heavily criticized George W. Bush for contributing to the national deficit, Obama must have thrown caution to the wind when he decided to increase government spending. Of all the problems I have with the proposed budget, one in particular irritated me: a new cap and trade policy. Another name for such a policy could be “a universal tax.” I call it a tax, because it brings in revenue that the government spends.
Cap and trade is one of those utopian ideas that looks real nice on paper, but completely fails in practice. (Socialism, anyone?) The basis behind cap and trade is, by requiring companies to bid on permits that allow them to pollute, companies will have an incentive to decrease greenhouse gas emissions. It’s as if they think businesses are just big, lazy, environment-killing entities that only produce pollution because they enjoy the damage it does to our planet. With a cap and trade policy in place, these companies will wave their magic wands and the pollution will be gone.
Wrong. In today’s business world, companies strive to have the most positive social appearance they can afford. Companies want to be seen as green because it improves business and makes them look great. Companies, especially those in the manufacturing and coal-fired power industries, will be hit hard by such a policy. In turn, the cap and trade tax would increase the cost of goods and services that rely on carbon energy. This means everyone, from the rich to the poor, will feel the impact of such a pointless program.
When I read of the proposed budget and tax increases (and I didn’t even mention taxes on businesses), I am reminded of two quotes. The first, by Winston Churchill, deals with taxes: “We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle,” The next, by Ronald Reagan, relates to the size and role of government: “Government is not the solution to our problem. Government is the problem.”
I truly hope I am wrong about America’s future with Obama at the wheel, but if not, we’re all in for a wild ride. I guess it’s just another sign of our decline.
Ryan Rougeau is a junior majoring in computer engineering. He can be contacted at [email protected].