Obama Talks Nonsense on Tax Cuts

**min0 lee** · 10-21-2008, 07:06 PM

shenanigans!

Main Street - WSJ.com

Revenues will inevitably be diverted from Social Security.

By WILLIAM MCGURN
Now we know: 95% of Americans will get a "tax cut" under Barack Obama after all. Those on the receiving end of a check will include the estimated 44% of Americans who will owe no federal income taxes under his plan.

In most parts of America, getting money back on taxes you haven't paid sounds a lot like welfare. Ah, say the Obama people, you forget: Even those who pay no income taxes pay payroll taxes for Social Security. Under the Obama plan, they say, these Americans would get an income tax credit up to $500 based on what they are paying into Social Security.

Just two little questions: If people are going to get a tax refund based on what they pay into Social Security, then we're not really talking about income tax relief, are we? And if what we're really talking about is payroll tax relief, doesn't that mean billions of dollars in lost revenue for a Social Security trust fund that is already badly underfinanced?

Austan Goolsbee, the University of Chicago economic professor who serves as one of Sen. Obama's top advisers, discussed these issues during a recent appearance on Fox News. There he stated that the answer to the first question is that these Americans are getting an income tax rebate. And the answer to the second is that the money would not actually come out of Social Security.

"You can't just cut the payroll tax because that's what funds Social Security," Mr. Goolsbee told Fox's Shepard Smith. "So if you tried to do that, you would undermine the Social Security Trust Fund."

Now, if you have been following this so far, you have learned that people who pay no income tax will get an income tax refund. You have also learned that this check will represent relief for the payroll taxes these people do pay. And you have been assured that this rebate check won't actually come out of payroll taxes, lest we harm Social Security.

You have to admire the audacity. With one touch of the Obama magic, what otherwise would be described as taking money from Peter to pay Paul is now transformed into Paul's tax relief. Where a tax cut for payroll taxes paid will not in fact come from payroll taxes. And where all these plans come together under the rhetorical umbrella of "Making Work Pay."

Not everyone is persuaded. Andrew Biggs is a scholar at the American Enterprise Institute and a former Social Security Administration official who has written a great deal about Mr. Obama's plans on his blog (AndrewGBiggs.blogspot.com). He notes that to understand the unintended consequences, it helps to remember that while people at the bottom pay a higher percentage of their income in payroll taxes, they are accruing benefits in excess of what they pay in.

"It's interesting that Mr. Obama calls his plan 'Making Work Pay,'" says Mr. Biggs, "because the incentives are just the opposite. By expanding benefits for people whose benefits exceed their taxes, you're increasing their disincentive for work. And you're doing the same at the top of the income scale, where you are raising their taxes so you can distribute the revenue to others."

Even more interesting is what Mr. Obama's "tax cuts" do to Social Security financing. As Mr. Biggs notes, had Mr. Obama proposed to pay for payroll tax relief out of, well, payroll taxes, his plan would never have a chance in Congress. Most members would look at a plan that defunded a trust fund that seniors are counting on for their retirement as political suicide.

And that leads us to the heart of this problem. If the government is going to give tax cuts to 44% of American based on their Social Security taxes -- without actually refunding to them the money they are paying into Social Security -- Mr. Obama will have to get the funds elsewhere. And this is where "general revenues" turns out to be a more agreeable way of saying "Other People's Money."

When asked about his priorities during the second presidential debate, Mr. Obama said that reform of programs like Social Security would have to go on the back burner for two years or so. "We're not going to solve Social Security and Medicare unless we understand the rest of our tax policies," he said.

The senator is right. But you have to read the fine print of his tax cuts to know why.

**ZECH** · 10-21-2008, 07:15 PM

Somebody gets it.

**Prince** · 10-21-2008, 07:25 PM

**KelJu** · 10-21-2008, 07:27 PM

Originally Posted by Prince

**Prince** · 10-21-2008, 07:34 PM

even better...

**Prince** · 10-21-2008, 07:37 PM

oh wait, the best yet...

**Prince** · 10-21-2008, 07:38 PM

**CORUM** · 10-21-2008, 07:52 PM

I have been asking all along, where he plans on getting all this money??? also how is he going to help these foriegn countries, our economy? he doesnt want more taxes and he doesnt want money from other nation, well i didnt graduate from harvard, but............ would you trust me if i told you i will give you a million dollars when you know i only have ten bucks in my account????? the said thing is 50 some odd % of the population believes his BS

**Prince** · 10-21-2008, 07:52 PM

McCain's Contradictions and Foolishness

**Prince** · 10-21-2008, 07:53 PM

McCain economic contradictions (9/26/08 Presidential debate)

**Prince** · 10-21-2008, 07:54 PM

John McCain - A living contradiction

**Prince** · 10-21-2008, 07:57 PM

Originally Posted by CORUM

I have been asking all along, where he plans on getting all this money??? also how is he going to help these foriegn countries, our economy? he doesnt want more taxes and he doesnt want money from other nation, well i didnt graduate from harvard, but............ would you trust me if i told you i will give you a million dollars when you know i only have ten bucks in my account????? the said thing is 50 some odd % of the population believes his BS

maybe if we stop wasting billions of $ in Iraq we might have some money?

The Iraq War Will Cost Us $3 Trillion, and Much More - washingtonpost.com

**PreMier** · 10-21-2008, 08:59 PM

Originally Posted by Prince

even better...

damn, bill is smooth

**PreMier** · 10-21-2008, 09:14 PM

Originally Posted by Prince

John McCain - A living contradiction

totally bitch smacked..

you have anything like this on obama?

**FishOrCutBait** · 10-21-2008, 09:52 PM

Originally Posted by PreMier

totally bitch smacked..

you have anything like this on obama?

Of course not!

**DOMS** · 10-21-2008, 09:53 PM

Originally Posted by PreMier

totally bitch smacked..

you have anything like this on obama?

He's barely worked 150 days, of course not.

Now, if you're looking for racist shit on Obama's part...

**bio-chem** · 10-21-2008, 09:53 PM

Let me get this right prince. your response to the unbelievably stupid obama math is to post a clip of a former president who has left public office?

**Prince** · 10-21-2008, 10:19 PM

Originally Posted by bio-chem

Let me get this right prince. your response to the unbelievably stupid obama math is to post a clip of a former president who has left public office?

yeah, it's all laughable and I really don't give a shit, I find it humorous how seriously you all take politics, its so corrupt, and the presidential election is not much more than a dog and pony show, get a clue "we the people" are not in control of shit, big business is in control, until you become part of the "rich and elite" you just don't matter in this game, but go on with your silly political debates and make yourself feel worthy and intelligent if that is what flips your nickel.

**FishOrCutBait** · 10-21-2008, 10:27 PM

Originally Posted by Prince

yeah, it's all laughable and I really don't give a shit, I find it humorous how seriously you all take politics, its so corrupt, and the presidential election is not much more than a dog and pony show, get a clue "we the people" are not in control of shit, big business is in control, until you become part of the "rich and elite" you just don't matter in this game, but go on with your silly political debates and make yourself feel worthy and intelligent if that is what flips your nickel.

**TexanTA1996** · 10-21-2008, 11:44 PM

It's quite amazing the selective reading that goes on here when it comes to history. Anyone remember the middle tax cut that Clinton promised but never came through on? Just wait and see what Obama will do. He may win the election, but I have a feeling the conservatives will have the last laugh.

Both parties lie, if you honestly believe that either party is actually looking out for the little man, you're an idiot.

**min0 lee** · 10-22-2008, 04:22 AM

Originally Posted by TexanTA1996

. Anyone remember the middle tax cut that Clinton promised but never came through on? .[/B]

Hmmm...let's see, Clinton promised a tax cut but we didn't get it.
Bush said no taxes and we still got taxed.
I like Clintons lie.

With Bush we had a recession and many of my friends lost our jobs including me.

With Clinton we did better at work.

**brogers** · 10-22-2008, 06:11 AM

Originally Posted by min0 lee

Hmmm...let's see, Clinton promised a tax cut but we didn't get it.
Bush said no taxes and we still got taxed.
I like Clintons lie.

With Bush we had a recession and many of my friends lost our jobs including me.

With Clinton we did better at work.

Clinton is not Obama. Clinton was a free trade candidate, he also signed welfare-reform into law.. things that were not popular with the liberal base of the democrat party but he had no trouble doing after 1994 with Republican control. Obama is anti-trade, for vastly increasing welfare. They've already proposed expanding unemployment benefits. Slick Willy he is not.

There will be no quicker way to harm job-creation than to raise taxes on investments and businesses... I don't think you have to be a genius to figure it out. Companies will lay people off to cover their tax bill, and that tax money will be "spread around" by a government bureaucrat to someone who didn't earn it.

**Prince** · 10-22-2008, 06:52 AM

Originally Posted by TexanTA1996

Both parties lie, if you honestly believe that either party is actually looking out for the little man, you're an idiot.

exactly.

**min0 lee** · 10-22-2008, 03:10 PM

Originally Posted by brogers

Clinton is not Obama.

I'm not comparing him to anyone, you can't compare him to anyone at this point.

**Jarhed** · 10-22-2008, 05:03 PM

You can debate over McCain this, Obama that, but the bottom line is...one of them is going to be President, so American's are going to have to choose between the lesser of the two evils!

**maniclion** · 10-22-2008, 05:46 PM

"If it was really a free market, and if America really rewarded merit instead of inherited wealth, a screaming mediocrity such as G.W. Bush would be working in a rock quarry somewhere. He's really that dumb." Jim Goad

At least the two candidates don't grind my bones like the current sad monkey in office now has over the past few years.....

**ZECH** · 10-22-2008, 06:21 PM

the Forgotten Restaurant

Remember in the vice presidential debate when Sen. Joe Biden referenced a restaurant in Wilmington, Delaware named â€œKatieâ€™sâ€ that he likes to frequent with the other common men and women?

Hereâ€™s what Sen. Biden said:

"All you have to do is go down Union street with me in Wilmington or go to Katie's Restaurant or walk into Home Depot with me where I spend a lot of time and you ask anybody whether or not the economic and foreign policy of this administration has made them better off in the last eight years."

Katieâ€™s closed sometime in the 1980s. So either Sen. Biden hasnâ€™t been in touch with middle class Americans for twenty years or heâ€™s completely lost touch with reality.

Or maybe he was just â€œwingingâ€ it.

**maniclion** · 10-22-2008, 07:19 PM

Originally Posted by dg806

the Forgotten Restaurant

Remember in the vice presidential debate when Sen. Joe Biden referenced a restaurant in Wilmington, Delaware named â€œKatieâ€™sâ€ that he likes to frequent with the other common men and women?

Hereâ€™s what Sen. Biden said:

"All you have to do is go down Union street with me in Wilmington or go to Katie's Restaurant or walk into Home Depot with me where I spend a lot of time and you ask anybody whether or not the economic and foreign policy of this administration has made them better off in the last eight years."

Katieâ€™s closed sometime in the 1980s. So either Sen. Biden hasnâ€™t been in touch with middle class Americans for twenty years or heâ€™s completely lost touch with reality.

Or maybe he was just â€œwingingâ€ it.

I say he's got a damned good memory for an old fart....

**CORUM** · 10-22-2008, 07:47 PM

you right the war does cost a lot prince, HAVE YOU BEEN????? if not do not complain where that money goes. those guys over there need ALL the support they can get. their equipment is being destroyed and there for a LONG time some people didn't have any. man up and be an AMERICAN and support the troops at war no matter the cost. UNTIL YOU WEAR HIS BOOTS YOU HAVE NO IDEA WHAT IS NEEDED

**Prince** · 10-22-2008, 08:12 PM

Originally Posted by CORUM

you right the war does cost a lot prince, HAVE YOU BEEN????? if not do not complain where that money goes. those guys over there need ALL the support they can get. their equipment is being destroyed and there for a LONG time some people didn't have any. man up and be an AMERICAN and support the troops at war no matter the cost. UNTIL YOU WEAR HIS BOOTS YOU HAVE NO IDEA WHAT IS NEEDED

well, if we were not at war the troops would not need any new equipment and/or support, not to mention 1,000 of young men and women would still be alive today, my point is/was we should not be at war in the first place, I think we can now all agree on that much... we are wasting billions of dollars for nothing.

FYI - I have never been to war, but I was in the US Army.

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