Catastrophe – Obama’s Broken Tax Promises
I’ve blogged about this before – how Obama’s tax promise of 95% of Americans won’t get any new taxes – has already been broken. Again on April 15, 2009 Obama said that taxes would not be raised on 95% of Americans.
“We’ve passed tax cuts that will help our economy grow. We’ve made a clear promise that families that earn less than $250,000 a year will not see their taxes increase by a single dime. And we have kept to those promises that were made during the campaign.” – Barack Obama, 4/15/09
This just doesn’t add up. In the stimulus there were tax cuts in the form of $13 a week for people making less than $90,000 a year. Ok that means a lot of people who make over $90,000 and less than $250,000 didn’t get a tax cut. Second Obama has said the Bush tax cuts will not be made permanent. Guess what? In 2010 the Bush tax cuts expire and everyone’s taxes will increase. Obama won’t have to raise them, he will just let the Bush tax cuts expire. Even if Obama allows the Bush tax cuts to stay in place for people who make less than $250,000, all they will get is the status quo. Their taxes won’t be cut any further. How is that a tax cut? It is all hype and no truth to the statement that 95% of Americans will get a tax cut. Cap and trade is hidden in the Obama budget and will increase the cost of food and goods for everyone. This is actually a tax increase. Although Obama won’t call it that, it is a tax increase.
In fact, it would be a huge tax. If enacted, cap-and-trade will be one of the government’s largest revenue sources within the next decade. It also would break one of President Obama’s promises. In his speech before Congress in February, he said, “If your family earns less than $250,000 a year, you will not see your taxes increased a single dime.” Unless you use energy, apparently.
Yet you won’t hear the proponents of cap-and-trade calling it a tax. The Obama administration and many members of Congress claim that any money generated by a cap-and-trade is “climate revenue.” As if every time the temperature rose, the government would magically receive more money. Not quite.
It’s a tax on your energy bill, plain and simple. The administration’s federal budget blueprint, however, maintains that everything will be all right. Why?
Because the money will be recycled back to the people. Under the EPA’s section of the budget, about $80 billion per year in energy tax revenues will be dispersed as a tax cut to low- and middle-income workers and used for renewable technology investment, beginning in 2012, if cap-and-trade becomes law. But the Congressional Budget Office estimates that the tax revenues from cap and trade could be much higher – as much as $300 billion per year by 2020.
Deep in the details of the budget, the Obama administration acknowledges this, when they suggest additional revenue would be redistributed to the public and when they say these “climate revenues” would be used for tax cuts.
Still, the numbers don’t add up. The administration sets aside $400 per individual and $800 per couple, but that diminishes for individuals making $75,000 or more for couples making above $150,000. It phases out completely for individuals whose income is above $100,000 and couples above $200,000 – clearly less than the $250,000 mark in Obama’s pledge.
And it may get worse than that. A new study by Bryan Buckley and Sergey Mityakov of Clemson University found that that the cap-and-trade approach contained in a bill introduced last summer by Sens. Joseph Lieberman, I-Conn., and John Warner, R-Va., would, in effect, hit the average American household with a tax hike of $1,100 in 2008 – a hike that would rise to more than $1,400 in 2015. There goes that “single dime” – and then some.
Such a tax hike might be justifiable, arguably, if the result was more jobs. But significantly taxing our most reliable sources of energy will only increase unemployment by slowing an already dragging economy.
According to The Heritage Foundation’s Center for Data Analysis of the Lieberman-Warner bill, cap-and-trade could result in job losses of 900,000 in some years. Americans should understand the costs of an energy tax, particularly in such tough economic conditions. Especially important, this tax falls disproportionately on the poor. Since low-income households spend a larger percentage of their income on energy, the tax is very regressive.
Dick Morris describes this well in this video as well as the new tax on benefits to pay for Obama’s health care debacle.
