And so it starts, "the death of a thousand cuts". Língchí was a form of torture and execution used in China from about the year 900 until 1905. It is a method of execution in which the subject is slowly killed by cuts removing pieces of the body.
While Obama talks tax cuts, House Majority leader Steny Hoyer announced plans to expand the State Children's Health Insurance Program by a 156% tax increase on cigarettes, raising the tax from 39 cents to an even dollar. That's an easy 21 billion in revenue over Obama's first term.
You see, we all know that children need medical coverage and that smokers are an easy target. 21 billion for very little pain or political capitol, since smokers are a relatively powerless minority and imposing a 'sin tax' on politically incorrect behavior is likely to have a positive political impact. Sooner or later someone will trump up the statistic that the tax saved 17,000 lives a year or something and Big Daddy Government is the hero.
Nancy Pelosi wants to see the existing current tax cuts repealed "Put me down as one in favor for repeal as soon as possible", the subject being, and let's not mince words... increasing taxes on those making more than 250,000 a year. You won't hear it put that way, but repealing a tax cut
is increasing taxes. Again it is a minority population, the top 1% of earners foot between 30 and 40% of the bill (figures vary).
One congressional budget office study on health care options looked at taxing soft drinks as a method of raising another 5 billion or so a year. Another cut taken from the body of a, if not small, at least relatively disorganized population segment. Do the Dew, so to speak. What kind of uproar is a tax on soft drinks going to generate? Certainly less than if they simply generated an additional 5 billion by raising the income tax.
Also on the table, a $500 payroll tax holiday, in essence another 'stimulus' check. It doesn't really have much of a long term significant impact on anything, but hey! It makes people feel good, at least for a little while, while most don't really ponder much over the fact that it's their own money they are getting back... at least for the taxpayers.
There is talk of leaving the Alternate Minimum Tax alone, this AMT was designed to ensure that the wealthy pay at least a minimum amount of taxes by closing off loopholes. Find enough loopholes and the AMT kicks in. Unfortunately, due to inflation, the AMT has been creeping down the tax bracket effecting more and more Americans it was never intended to 'get'.
And it is all accomplished with smoke and mirrors, we don't "raise" taxes, we "repeal cuts" , we take your money, give a little bit back, and you thank us for it. We're not going to tax your income, but we'll damn well tax your spending, especially on all that stuff we don't think you should be doing in the first place, like smoking cigarettes, drinking soda, and emitting carbon.
As we prepare to enter the new administration Hoyer was quoted as saying "Republicans proceeded over the last eight years as if deficits didn't matter", with a straight face as the congressional budget office informs us that we face an unprecedented projected deficit of 1.2 trillion for Obama's first year in office.
Honestly, the current fiscal crisis is a godsend to those of a big government, socialist bent... they can implement all the big government they want under the excuse of 'economic recovery'. In his American Recovery and Reinvestment Speech today our future president said "No longer can we allow the unscrupulous lending and borrowing that leads only to destructive cycles of bubble and bust." I am left wondering what he thinks a 1.2 trillion dollar deficit is.
Sure, spending 1.2 trillion dollars is going to stimulate the economy and create jobs, but it is a short term fix for a long term problem, and it is self-perpetuating. Once the government starts throwing big money around, they are not going to be able to stop. When government steps in to be the Big Daddy and take care of everyone the question we should be asking is how they intend to extricate themselves from the position a few years hence. Obama wants to modernize 75% of federal buildings...and when that is done? what? lay all the workers off? Growing government is always much easier than shrinking it. The question is what does government do when it can no longer afford to be Big Daddy? When Roosevelt tried to balance the budget in his second term following the great depression it caused a 4% jump in unemployment. The only thing that saved his ass was World War II.
1.2 trillion dollars the first year alone, the money is going to have to come from somewhere. The government can not continue to borrow, borrow, borrow, without devaluing the currency, our bond rating goes down, foreign investment goes down, inflation goes up. Unreformed (and by reformed they don't mean expanded), the government accounting office estimates that Medicare and Social Security expeditures will exceed revenues by 40 trillion dollars over the next 75 years... sometime between 2030 and 2040 expenditures will exceed income, and we are looking at expanding these programs. 25 percent of the debt is held by foreign governments, the risk in expanding debt is not inflation but hyperinflation.
The government is going to be forced to increase revenue, at first most likely by Língchí...that is increasing taxes a little here and a little there, most likely in a fashion least likely to cause a public backlash. Eventually you are going to have to see an across the board increase in taxes to pay for all this...all the while the value of American currency is going to be going down, the price of foreign imports is going to be going up (and that's a lot of stuff since manufacturing has been moving overseas), you... all of you, will lose purchasing power... and we're all going to pay for it in the end.
2+2=5...it's doubleplus good!
~Finntann~
