Thursday, April 14, 2011


THE PRESIDENT OF THE UNITED STATES OF AMERICA recently unveiled what he called a fiscally responsible budget proposal whose corner stone is taxing success..................what audacity indeed.

Barack Hussein Obama campaigned on the promise that he would reduce the national deficit by 50% (~$4 trillion) by the end of HIS first term.  However, half way through this "historic" term; the national deficit has instead INCREASED by well over $4 trillion.

U.S. Congressman Paul Ryan's $6 trillion deficit reduction proposal over ten (10) years has pressured Obama, commonly known as the man without a plan, to step into the budget arena.  Thus, Obama, in his typical indignant fashion,  had the unfettered gall to propose a plan to reduce the deficit by $4 trillion in twelve (12) years.
In other words, not only does Obama's budget proposal NOT fulfill his 2008 campaign pledge of a 50% deficit reduction during his first term; it will now take TWELVE (12) years to merely bring the deficit almost BACK to the level he INHERITED.

Obama's plan is classic Democratic victim hood economics.................excuse the consequences of irresponsibility by playing to the masses through class envy.  Demonize responsibility, sacrifice, and hard work by labeling those that proscribe to that behavior as the exploitive "rich" and demand that they pay their "fair share".

But what are the guidelines for determining an individual's fair share? Currently, the bottom half of the socio-economic ladder pay essentially no federal income tax and the top 10% of wage earners cover upwards of 70% of the income tax burden.

The personal income tax rates in America have gone up and down over time.

In order to help pay for its war effort in the American Civil War the United States government imposed its first personal income tax, on August 5, 1861, as part of the Revenue Act of 1861 (3% of all incomes over US $800). This tax was repealed in 1862.
In 1894, Democrats in Congress passed the Wilson-Gorman Tariff, which imposed the first peacetime income tax. The rate was 2% on income over $4000, which meant fewer than 10% of households would pay any. The purpose of the income tax was to make up for revenue that would be lost by tariff reductions.

In 1913, the Sixteenth Amendment to the United States Constitution made the income tax a permanent fixture in the U.S. tax system.
In fiscal year 1918, annual internal revenue collections for the first time passed the billion-dollar mark, rising to $5.4 billion by 1920.
With the advent of World War II, employment increased, as did tax collections—to $7.3 billion.
The withholding tax on wages was introduced in 1943 and was instrumental in increasing the number of taxpayers to 60 million and tax collections to $43 billion by 1945.

Obama argues that by not renewing the current tax structure for the top wage earners in America he is simply eliminating tax breaks for the rich...........................REALLY?
Increasing the tax bracket for higher wage earners is NOT eliminating anyone's tax breaks it is nothing more than an across the board tax increase on those earning an arbitrary amount that the government unilaterally considers a lot of money.

If it were really an issue of everyone paying their fair share of personal income taxes; Congress and the President ought to address how a Wilson-Gorman (supra) tax model is not a more equitable solution than the class envy model.

America's National debt crisis is not an issue of inadequate tax revenues it is an issue of fraudulent and abusive spending by our elected leaders for whom the rules don't apply.......

1 comment:

jigmeister said...

Our tax system is a mess. Obviously we need to rein in spending, end a couple of wars and start fixing our rotting infrastructure. The most efficient way would be a flat tax in the neighborhood of 15% across the board for everyone and everything that earns an income. That would put tax lawyers out of business and make the IRS irrelevant. Everyone would know exactly how much they owe. No exemptions for anyone. You make $100,000, you pay $15,000. You make $10K you owe $1,500. A corporation does business in this country it pays a fixed percentage of gross income earned in this country. Tax law professors would be pissed!