Obama argues against letting the Bush tax cuts expire
I know, you’re going,” say what!? “
A year ago, probably when Obama thought we’d be out of the recessionary woods by now and only 20% of the “stimulus” had been spent, he was questioned while in Elkhart, IN, about the economics of a tax hike during a recession. The question was submitted by an Elkhart resident (Scott Ferguson) and asked by Chuck Todd of SNBC. Todd asked, “Explain how raising taxes on anyone during a deep recession is going to help with the economy.”
Obama said it wouldn’t:
“Well—first of all, he’s right. Normally you don’t raise taxes in a recession, which is why we haven’t and why we’ve instead cut taxes. So I guess what I’d say to Scott is—his economics are right. You don’t raise taxes in a recession. We haven’t raised taxes in a recession.”
Absolutely true to that point. But the larger point is the admission – “you don’t raise taxes in a recession”.
Todd riposted with “But you might for health care. You might for the high—for some of the wealthiest.”
Obama responded very emphatically:
We have not proposed a tax hike for the wealthy that would take effect in the middle of a recession. Even the proposals that have come out of Congress—which by the way, were different from the proposals I put forward—still wouldn’t kick in until after the recession was over. So he’s absolutely right, the last thing you want to do is to raise taxes in the middle of a recession because that would just suck up—take more demand out of the economy and put businesses further in a hole.
Emphasis added, but wow – exactly. It is “the last thing you want to do” and it will “put businesses further in a hole”.
So that was then and this is now – everyone who is actually having to deal with what is going on know we’re still in a recession. But technically, we’ve had the “two consecutive quarters of growth” necessary to claim we’re in a recovery. The fact that the “growth” was pretty much all government spending – borrowed money – doesn’t count. The technical definition wins out.
That means he can, with a straight face, claim that letting those tax cuts expire is OK because we’re no longer in a recession.
Of course that’s just ludicrous to anyone who has two brain cells to rub together. It is unwise and economically the wrong thing to do. But, as Turbo Tax Timmy Geithner has decided, when asked about those expiring tax hikes, “The country can withstand that. The economy can withstand that. I think it’s good policy.”
Is it? Or is it good “ideology”?
Tax the rich – a liberal mantra for decades. Take the seed corn and pass it out to those who will eat it instead of plant it. Ensure that those of the investor class have less to invest. Put businesses in a deeper hole. Give the money to government which can obviously spend it more wisely than can the private side.
The $787 billion dollar “stimulus”?
Move along, citizen – nothing to see here.