Free Markets, Free People
When someone, anyone, is “paying” for it.
A tax cut, as I understand the term, means taxes are cut – not made up somewhere else. In other words, it is a revenue loss for government. Period.
Not so with the latest payroll “tax cut”. In the case of the 2 month extension recently passed, government isn’t going to be out any revenue. Other tax payers will be paying the freight as they refinance their houses.
Just before Christmas, American workers got a rare gift from Washington politicians – the current payroll tax cut would be extended for two more months.
At the time, both President Barack Obama and House Speaker John Boehner lauded the move to avoid a tax increase for millions of working Americans.
But there’s something the politicians weren’t bragging about – the fact that they’re paying for the two-month tax cut with what has turned into a brand new fee on home buyers.
The new fee is a minimum of one-tenth of 1 percent on Fannie Mae- and Freddie Mac-backed loans, and is likely to go much higher.
It will be imposed for the next 10 years on most mortgages and refinancings and it lasts for the life of the loan.
Got that? This is simply unacceptable. If you get a loan backed by Freddie or Fannie within the next 10 years, you will pay a “fee” (read TAX) that will “pay for” this supposed “tax cut”.
An Obama administration official defended the mortgage fee, calling it "modest." She said it’s "unlikely to negatively affect borrowers" because increases "will be phased in over the next two years." And it will "help bring private capital back into the mortgage market, which [is] good for borrowers over the long term."
Here, take this poison — it will be good for your long term.
Here’s how it breaks down for those who are or are planning on buying or refinancing a loan in the next 10 years:
It’s bad news for Patty Anderson, who’s buying a home in Virginia.
Anderson will save a couple hundred dollars from having her payroll tax cut extended but her mortgage broker told her the new fee would cost her almost $9,500.
"I was absolutely startled that it would add up to that much," she said.
Well yeah, it’s only about $7.50 a month for every $100,000 in mortgage you’re committed too – for the life of the loan.
I think Bill Burnett, president of the Virginia Association of Mortgage brokers said it best, and, by the way, summed up in one sentence what has become routine in DC:
"Your pocketbook is being raided in order to pay for a tax policy issue decided at the last minute by probably people who didn’t understand fully what they were legislating on."
Remember “we have to pass the bill to find out what’s in the bill”? Well here we are again.
At least one representative figured it out, but couldn’t find anyone interested in the problem. Rep.Allen West:
"I read the legislation and raised the flag. Unfortunately nobody paid attention to what I was saying at the time," he said, calling the fee a backdoor tax increase on the middle class.
Of course it’s a backdoor tax and calling it a fee doesn’t change that.
Your government at work.
The editors of the Washington Examiner consider the probable effects of the new CAFE standards (being imposed by the EPA now instead of NHTSA) and ask a pertinent question:
Getting from the current 35 mpg CAFE standard to 54.5 can be achieved by such expedients as making air conditioning systems work more efficiently. We have a bridge in Brooklyn to sell to anybody who thinks that’s even remotely realistic. There is one primary method of increasing fuel economy — weight reduction. That in turn means automakers will have to use much more exotic materials, including especially the petroleum-processing byproduct known as “plastic.” But using more plastic will make it much more difficult to satisfy current federal safety standards. The bottom-line will be much more expensive vehicles and dramatically fewer kinds of vehicles.
Total costs, as calculated by the EPA, will exceed $157 billion, making this by far the most expensive CAFE rule ever. For comparison, the previous rule in 2010 cost $51 billion, according to the EPA. But the EPA doesn’t include this fact in its calculation: Annual U.S. car sales are 14-16 million units, yet over time, this rule will remove the equivalent of half a year’s worth of buyers. Will that be when the EPA takes a cue from Obamacare and issues an individual mandate that we all must buy Chevy Volts?
I’m just curious, for those who support the individual mandate dictated by Obamacare, what is the argument that such an electric car mandate isn’t possible? If the federal government can force us to purchase insurance from the companies it allows to offer the product based on the idea that health care is a national issue, how is promoting cleaner air and more energy security not the same thing? Indeed, it would seem that the arguments are even stronger for forcing everyone to buy electric cars if furthering the “common good” is the only real restriction on federal power.
So what is the difference from a legal, constitutional standpoint? Is there one?
The CAFE rule is the fleet-wide average fuel economy rating manufacturers are required by Washington to achieve. The new rule — issued in response to a 2010 Obama directive, not to specific legislation passed by Congress — would require automakers to achieve a 40.9 mpg CAFE average by 2021 and 54.5 mpg by 2025.
Got that folks … your representatives had nothing to say about or do with this. It was dictated from on high.
In case you’re wondering whatever happened to the National Highway Traffic Safety Administration, it has been supplanted in the CAFE process by the EPA. The proposed regulation was designed, according to the EPA, "to preserve consumer choice — that is, the proposed standards should not affect consumers’ opportunity to purchase the size of vehicle with the performance, utility and safety features that meets their needs." But the reality is that consumer choice will be the first victim.
And that essentially means that with the switch from the NHTSA to EPA, the auto industry most likely had no place at the table. An agency with an agenda but little experience with the industry came up with the new rules.
Also note the usual pandering to choice. They talk the talk, but reality shows they’re not at all sincere about it:
Getting from the current 35 mpg CAFE standard to 54.5 can be achieved by such expedients as making air conditioning systems work more efficiently. We have a bridge in Brooklyn to sell to anybody who thinks that’s even remotely realistic. There is one primary method of increasing fuel economy — weight reduction. That in turn means automakers will have to use much more exotic materials, including especially the petroleum-processing byproduct known as "plastic." But using more plastic will make it much more difficult to satisfy current federal safety standards. The bottom-line will be much more expensive vehicles and dramatically fewer kinds of vehicles.
They’ll have to be much smaller and much lighter and they’ll cost an average of $3,200 dollars more (and that’s the lowball estimate). Yup, no intrusion into the market there. They’ve given “choice” lip service – get over it.
The U.S. Energy Information Administration projects that there will be no vehicles costing $15,000 or less, the segment of the market that college students and low-income consumers depend upon. Altogether, an estimated seven million buyers will be forced out of the market for new cars.
Note, it’s the new car market at risk.
Total costs, as calculated by the EPA, will exceed $157 billion, making this by far the most expensive CAFE rule ever. For comparison, the previous rule in 2010 cost $51 billion, according to the EPA. But the EPA doesn’t include this fact in its calculation: Annual U.S. car sales are 14-16 million units, yet over time, this rule will remove the equivalent of half a year’s worth of buyers.
But remember, to the sycophants, this is the crew that “saved” the auto industry. Now you can understand that it was only for political reasons that was attempted. Those jobs and industries, after this election year, are no longer critical. In fact, they actually hamper the goal to “revolutionize” the energy sector. That’s much more important than the middle class the left is currently and conveniently so fond of.
Put this one under “the law of intended consequences”.