If you were wondering what it would take in terms of tax rates, to “erase the deficit”, the Tax Foundation [pdf] provides a couple of handy, dandy charts for you:
Note – this only “erases the deficit” – it does not even make a small dent in the debt which stands somewhere in the 11 trillion dollar area.
So when you hear that all this new spending, which will indeed raise the deficit, won’t raise your taxes by a single “dime”, you can believe it if you wish. But that doesn’t mean it is true. And it certainly doesn’t mean Democrats can keep that promise. Because if they do, they’re simply kicking the same can down the road that Republicans have for years (and no, I’m not advocating massive tax increases, I’m just providing a little reality check to counter the nonsense the politicians continue to spout). The alternative to the tax rates above is to cut spending – drastically. If you see that on the horizon you’re the only one because Congress just raised the debt ceiling – again.
[HT: Tax Prof]
Right now, if you believe the final Public Policy Polling surveys in New Jersey and New York’s 23rd Congressional district, it looks like wins for the right side of the ideological curve.
In NY-23, PPP has Hoffman at 51%, Owens at 34% and Scozzafava – the GOP’s favored nominee – at 11%. So the insurgent conservative candidate who the GOP is now quite happy to claim, is pulling a majority in the district. Head to head, PPP has Hoffman at 51% and Owens at 38%. The former GOP candidate has chosen to act as conservatives thought she would – she’s endorsed the candidate which most closely matches her politics – the Democrat. Joe Biden will be in the district today to try and push Owen’s numbers up.
“Polling the race was a little haphazard in a weekend with many twists and turns but Hoffman showed a similar lead at all junctures… The bottom line though is that Hoffman led by double digits during every segment of the poll, an indication that he may have been headed for a definitive victory regardless of Scozzafava’s actions over the course of the weekend.”
In the NJ governor’s race, PPP has Christie at 47%, Corzine at 41% and Daggett at 11%.
PPP points out that in NJ, the difference is independents going over to Christie’s side in a big way:
“Christie’s advantage is due largely to his support from independents and because he has Republicans more unified around him than the Democrats are around Corzine. Christie leads Corzine 52-29 with indies, as Daggett’s support with that group has declined to 16%. Christie is getting 82% of Republicans to Corzine’s 72% of Democrats.”
Of course this is NJ we’re talking about and 6% would seem to be a pretty significant lead, but there are factions at work which will most likely do whatever is necessary to overcome that. But the defection of independents to the Republican candidate has to worry Democrats.
And I’d guess that what is happening in the VA Governor’s race is much the same as what is being seen in NJ – McDonald leads Deeds mostly because of a more unified Republican base and the defection of Independents.
Should all 3 go to the Republicans, it will be very interesting to see the spin – from both sides. Democrats will most likely downplay the significance while privately being very concerned with 2010 right around the corner. And Republicans will most likely misread the results as some sort of mandate for them and their “big tent” compromising ways.
Suffice it to say these are 3 specials that I’ll actually be interested in following tomorrow, if for no other reason than to hear the establishment party types on both sides explain what happened.
I‘m not kidding. So says none other than the New York Times:
A Week Mapping Radioactive Rabbit Feces With Detectors Mounted On A Helicopter Flying 50 Feet Over The Desert Scrub. … $300,000 In Federal Stimulus Money.” … “A government contractor at Hanford, in south-central Washington State, just spent a week mapping radioactive rabbit feces with detectors mounted on a helicopter flying 50 feet over the desert scrub. … the helicopter flights, which covered 13.7 square miles and were paid for with $300,000 in federal stimulus money, took place in an area that had never been used by the bomb makers. … Marylia Kelley, the executive director of a California group called Tri-Valley Communities Against a Radioactive Environment, said the rabbit cleanup was ‘kind of funny, in a sick way.”
A great way to stimulate the economy, no?
Well how about this:
“President Obama’s Stimulus Plan… Is Now Paying Americans To Buy That Great Necessity Of Modern Life, The Golf Cart.”…“Thanks to the federal tax credit to buy high-mileage cars that was part of President Obama’s stimulus plan, Uncle Sam is now paying Americans to buy that great necessity of modern life, the golf cart. The federal credit provides from $4,200 to $5,500 for the purchase of an electric vehicle, and when it is combined with similar incentive plans in many states the tax credits can pay for nearly the entire cost of a golf cart.”
Let’s not forget that our president is a great fan of golf afterall. What better way can you think to stimulate the economy?
Oh, how about this?
“The other third of the stimulus, government infrastructure spending, has been the most controversial from the start. Some proposals have been criticized as wasteful, Such as a $6 million snowmaking facility in Duluth, Minn.”
A snowmaking facility in Duluth, MN – the 15th “snowiest” city in America. Why that’s a perfect way to stimulate the economy.
But if that doesn’t resonate, there’s this:
“A big chunk of the money that will pay for a new spring-training baseball complex on Ttribal land in the East Valley will be delivered via a financing program that’s part of the Federal Economic-Stimulus Plan. The Salt River Pima-Maricopa Indian Community says it may borrow as much as $30 million of the estimated cost of the $100 million complex near Scottsdale that will become the spring home of the Arizona Diamondbacks and the Colorado Rockies.”
Because, of course, MLB is going broke.
You can read the whole disgusting list here.
Wasn’t Joe Biden going to police this?
Oh wait, I forgot – he and John Kerry are preoccupied deciding our new strategy in Afghanistan.
Yeah, nothing can go wrong with that, can it?
Dede Scozzafava, who suspended her House campaign earlier this week, in the face of rising discontent from Republican rank and file voters over her candidacy in the conservative NY-23 district, made the following statement this afternoon:
I want to thank you for your support and friendship. Over the past 24 hours, I have had encouraging words sent to my family and me. Many of you have asked me whom you should support on Tuesday.
Since announcing the suspension of my campaign, I have thought long and hard about what is best for the people of this District, and how to answer your questions. This is not a decision that I have made lightly.
You know me, and throughout my career, I have been always been an independent voice for the people I represent. I have stood for our honest principles, and a truthful discussion of the issues, even when it cost me personally and politically. Since beginning my campaign, I have told you that this election is not about me; it’s about the people of this District.
It is in this spirit that I am writing to let you know I am supporting Bill Owens for Congress and urge you to do the same.
So much for being a “lifelong Republican”.
In this podcast, Bruce, Michael and Dale discuss the state of the economy, and the health care bill that came to the house floor this week.
The direct link to the podcast can be found at BlogtalkRadio.
The intro and outro music is Vena Cava by 50 Foot Wave, and is available for free download here.
Call in number: (718) 664-9614
Yes, friends, it is a call-in show, so do call in.
Subject(s):Economy (is the recession over?), health care math, NY-23 (what does it mean if anything?), California (no interest loans to the state from worker’s paychecks), Afghanistan (is the decision again delayed?), Honduras, etc.]
From a short post about The Wire by Jonah Goldberg at The Corner:
A lot of conservatives today are too quick to think that because liberals have some affinity for Marxist sentiments that they are actual Marxists. Liberals often make the same mistakes as Marxists, but they’re not Marxists.
I suppose this is true, but it got me to wondering. So I have a question for QandO readers.
Suppose, completely hypothetically, that Obama were a hard-core Marxist who wanted to go in the direction of Marxist programs as quickly as the system in place in this country allowed him to move.
Looking at his history in office so far, do you think there are any decisions that the hypothetical Obama-the-Marxist would obviously have made differently than the real Obama? If so, which ones?
Despite all the happy talk from the administration and the lap-dog press eagerly parroting the “good news” that the recession is over, the numbers just don’t support the talking point. Liam Halligan delivers the news:
So I was pleased last week when I heard that, after four successive quarters of contraction, America’s economy grew by an impressive 3.5pc between July and September, compared to the quarter before. “The US is out of recession” numerous newspaper headlines screamed. No wonder share prices surged.
As ever, the numbers warrant a closer look. For one thing, this is annualised data. So the US economy actually expanded by only 0.9pc during the third quarter – a fact most newspaper reports ignored. What growth we did see resulted from a 3.4pc annualised rise in US consumption between July and September, which was in turn caused by a 22.3pc spike in spending on consumer durables.
As mentioned here that “spike” was driven by “cash for clunkers” and the $8,000 first time homeowners tax exemption. Halligan agrees. It wasn’t a trend, it was exactly what Halligan reported – a spike. So digging into it, what are the real numbers?
In other words, this latest US growth spasm stemmed from one-off government “giveaways” – with the public only able to take advantage of such gimmicks by going deeper into debt. The rise in US consumption coincided with a 3.4pc fall in household disposable income and a plunging savings rate too. With government and household debt spiralling anew, America’s so-called “return to growth” is nothing but a return to higher leverage. [emphasis mine]
Not quite what the administration cracked it up to be, is it? And Halligan reminds us:
Over the last 40 years, all US slumps have been interrupted by at least one quarter of positive growth, followed by a renewed downturn.
Of course, with an administration desperate for any good news, ignoring history is to be expected. After all, they’re quite the masters at ignoring the laws of economics and expecting results which run counter to them, aren’t they? Why shouldn’t they believe that one quarter of government give-aways equals pulling out of the recession? Can’t wait to hear the excuses when we’re back in the negative GDP growth trend next quarter. And you can also expect to hear the inevitable cries for a second stimulus (Porkulus II) crescendo.
Who was it who said “the government powerful enough to give you things is powerful enough to take things away”?
Well that has never been more true than in California where the state has decided to arbitrarily increase withholding by 10% because it couldn’t manage its debt. IOW, Californians take less home so the state can pay its debt:
Starting Sunday, cash-strapped California will dig deeper into the pocketbooks of wage earners — holding back 10% more than it already does in state income taxes just as the biggest shopping season of the year kicks into gear.
Technically, it’s not a tax increase, even though it may feel like one when your next paycheck arrives. As part of a bundle of budget patches adopted in the summer, the state is taking more money now in withholding, even though workers’ annual tax bills won’t change.
Think of it as a forced, interest-free loan: You’ll be repaid any extra withholding in April. Those who would receive a refund anyway will receive a larger one, and those who owe taxes will owe less.
You’ll get a “larger” refund if the state has the money to pay refunds. Weren’t they issuing IOUs not long ago? But that’s not the point. The state has just made it clear that it has first claim on what Californians earn. If that doesn’t scare the bejesus out of them, I’m not sure what will.
And if that doesn’t increase the emigration to less oppressive climes I’m not sure what would.
Actually, it isn’t that hard. And the Democrats demonstrate how to do it in the House Health Care bill. James C. Capretta explains:
For starters, the gross cost of expanded Medicaid coverage and a new entitlement to subsidies for health insurance is much higher than Democrats are suggesting, according to the cost estimate released yesterday by the Congressional Budget Office (CBO). The Democrats report a lower number by netting out the taxes some individuals pay when they don’t enroll in insurance as well as the tax payments from employers who choose to “pay” rather than “play.” But that accounting confuses tax increases with spending reduction. The gross spending increase from the entitlement expansions in the revised House bill is $1.055 trillion over ten years, not $894 billion.
Remember, this is about what it will cost taxpayers. And netting out those who “pay” doesn’t lessen the cost or necessarily mean the revenue collected will go toward paying for this expanded health care.
In addition, as I noted previously, House Democrats have conveniently decided to take the so-called “doc fix” out of the larger health-care bill and pass it as a standalone measure, at a cost of $250 billion over ten years. The House health-care bill is bursting with other Medicare-related provisions. What could possibly justify separate accounting for the physician fee fix? In fact, there is no justification, other than budgetary smoke and mirrors. House leaders are splitting the costs of their scheme into two bills and pretending that this maneuver somehow brings down the overall cost to taxpayers. It doesn’t. In reality, House Democrats are still planning to spend $250 billion on Medicare physician fees, and that should be made clear in any honest accounting of what’s afoot here.
So a quarter of a trillion dollars in cost is going to be excluded from the pending health care bill and passed separately. This defines the terms “smoke and mirrors” when it comes to the real cost of this “reform”. And you can count on Democrats using every little procedural and legislative trick in the book to make this appear to be something it isn’t from a cost stand point – as demonstrated by this particular exclusion from the larger bill. This is, along with global warming, is one of the biggest con jobs ever foisted upon a people.
Finally, there’s the other spending in the health-care plan. There’s loads of it. Higher Medicaid matching funds to buy off selected governors. A new program aimed at encouraging more physicians to enter primary care. Prevention spending. And apparently just about anything else House Democrats could think of to spend taxpayers’ money on. When it’s all racked up, these programs cost $230 billion over a decade. And that’s not even including the extra spending on Medicare drug coverage, which is obscured in CBO’s accounting by provisions which allow the government to set payment rates for certain products.
The 900 billion that President Obama set as an upper limit that would not add a “dime to the deficit” isn’t even close to being met. The cost curve and the deficit curve, as demonstrated above, will definitely go up. But there’s political cover here because the CBO has scored this bill under the 900 billion “won’t add to the deficit” threshold. Of course the CBO can’t score a separate bill that hasn’t been written yet (“doc fix”) nor can it add it to the bill it just scored. And, of course, the CBO estimate for 10 years assumes the legislation will be enacted precisely as it is written and remain unchanged for those 10 years – and we know that won’t happen as well.
But that won’t stop Obama and the Dems from claiming they’ve met the goal of not adding to the deficit when this monstrosity passes. Just hide and watch.
And they’ll also claim they have the revenue to pay for all of this:
On the tax side, Democrats are planning to saddle those with incomes exceeding $500,000 per year with a new 5.4 percent surtax. That would raise $461 billion over a decade, according to the Joint Tax Committee. But there’s also the penalty tax imposed on individuals who don’t sign up for health insurance. That raises $33 billion There’s also the employer “pay or play” mandate, which brings in $135 billion. And finally, there are the taxes on medical device manufacturers and many others. These provisions raise an additional $100 billion over a decade. All in, therefore, House Democrats want to raise taxes on Americans by $725 billion over the period 2010 to 2019 to partially pay for their health-care scheme.
Again, the assumption is that all of these will remain constant revenue streams. Of course, they won’t. The rich will find a way to avoid the tax eventually as will individuals taxed for not getting insurance. And employers will certainly find a way to avoid the penalty of “pay or play”. Plus, I’d be willing to bet that medical device manufactures and other providers will eventually be exempted from their tax when a outcry is heard from those who benefit from their products that the cost is too high. While these revenue streams won’t dry up, common sense says they will be vastly reduced.
And that leave them with what? It leaves them with little choice but to do what everyone has said they’ll be forced to do:
The Democrats close the remaining gap (excluding the physician fee spending) by cutting Medicare and Medicaid spending by about $550 billion over ten years and starting up a new, budget-busting long-term care program that brings in $72 billion in excess premiums in its early years.
The plan is $550 billion in cuts over 10 years. The reality, because the other revenue streams will begin to dry up, will be much higher.
That reality will eventually mean what as costs spiral upward alarmingly?
And who stands the biggest chance of becoming the victim of that rationing?
Those who use the most health care.
And as a demographic, who are they?
“Death panels” anyone?