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Obama's "Tax Cuts"

During the debate liveblogs, a phrase I find myself typing often is "TAX CREDITS ARE NOT TAX CUTS." It's usually in response to Barack Obama's promise to "cut taxes for 95% of Americans," a promise that as of now, has gone frustratingly unexamined by the media and largely unchallenged by the McCain campaign.

The Wall St. Journal looks at Obama's proposals, and the results aren't pretty. In addition to creating a larger de facto welfare state, the Obama tax plan would actually increase taxes on low-income and middle-class workers:

Because Mr. Obama's tax credits are phased out as incomes rise, they impose a huge "marginal" tax rate increase on low-income workers. The marginal tax rate refers to the rate on the next dollar of income earned. As the nearby chart illustrates, the marginal rate for millions of low- and middle-income workers would spike as they earn more income.

Some families with an income of $40,000 could lose up to 40 cents in vanishing credits for every additional dollar earned from working overtime or taking a new job. As public policy, this is contradictory. The tax credits are sold in the name of "making work pay," but in practice they can be a disincentive to working harder, especially if you're a lower-income couple getting raises of $1,000 or $2,000 a year.

"Spread the wealth around." This chart shows just where that wealth is going to come from:

ED-AI343_1taxcr_NS_20081008232813.gif

The effective marginal rate (what you actually end up paying) on middle-income workers is going to increase and the rate on those who make $100,000 and over is going to near-Canada levels of taxation. And as the Journal states, there's little incentive for low-income workers to increase their wage, lest they be punished with a higher effective rate.

For workers earning $45-$85, a 3% increase in the marginal rate may not seem all that bad, but consider that the average rate of inflation between 1997-2007 was about 2.5% and it's increased a bit faster this year. Many workers, however, do not receive wage increases that match the rate of inflation, which is effectively a wage reduction. Take another 3% out of those paychecks and Obama's tax cut plan could mean a 3-5% reduction in spending power for a good number of American families.

All in the name of "fairness."

Update - Link to WSJ piece added. Sorry about that.

Update II - Both Phil and pbrown disagree with the WSJ's conclusion regarding low-class taxes, and the latter makes a compelling case:

At the risk of being thought a concern troll, this conclusion doesn't quite follow from the article:

the Obama tax plan would actually increase taxes on low-income and middle-class workers

Marginal tax rates are the amount of tax you pay on the *next* dollar you earn. Let's say you had a hypothetical tax plan that guaranteed everyone made at least $30K. If you made $50K, you'd have a taxable income of $20K. If you made $30K, you'd pay no taxes at all. If you made $20K, you'd pay no taxes *and* get a $10K check from the guv'mint. This plan would *significantly* increase the marginal rates of low-income workers -- the marginal tax rate would be 100%! There would be no reason to work at all unless you could pull down considerably more than $30K. But despite the fact that you have this atrocious marginal tax rate, people earning less than $30K would still pay less in taxes than they did today. And they'd have a hell of a lot more free time!

Another example -- McCain's health care plan increases the marginal tax rates on some lower-income workers with health benefits. But it does so because the benefits themselves are counted as income. So if you made $30K and had $10K of employer-paid benefits, you'd have $40K of gross income. (Effectively, it shifts the marginal tax rate curve to the left.) But that doesn't mean his plan increasing your taxes, since the marginal rates don't account for the $5K credit.

That said, Obama is full of shit about his tax plan. President Clinton promised a middle-class tax cut that vanished soon after he was elected because of "economic conditions". The state of the federal budget today is a hell of a lot worse than it was in 1993, and I would expect to hear the same thing soon after election day. If The Messiah wins, you will soon hear talk of rich people earning "tenth of a million" instead of a "quarter of a million". Honestly, I think his tax increases on the "rich" and businesses are more about redistribution "fairness" than any potential revenue increase to the federal government.

I think the joke about free time communicates a sad truth about this tax plan: giveaways would provide low-income workers little incentive to increase their income. The punishing tax rates at the top end of the income scale makes a certain level of economic success unattractive, since you'd get to keep a much smaller percentage of your income.

Posted by: Slublog at 09:10 AM



Comments

1 Dig it! The Obama tax plan would actually increase taxes on low-income and middle-class workers. Wild!

Posted by: Bernadine X at October 14, 2008 09:28 AM (j02xJ)

2 Uh, well, I, uh, already made my big bucks, so it won't affect me or people like my good friend Bill Ayers, who are already rich.

Too bad, morons. You snooze, you lose.

Posted by: Barak Obama at October 14, 2008 09:29 AM (oEAm5)

3 I couldn't help but notice how generous his marginal tax rate line is on families making less that $45,000 a year. How generous for the Obamamessiah.

Posted by: Luke at October 14, 2008 09:31 AM (wfWH2)

4 Good!  Someone's going to finally stick it to those lower-middle class bastards getting more lower-middle-class on the backs of the upper-middle-class bastards!

Why doesn't the Obamessiah simply make the minimum wage $250,000/year?

Posted by: Stinky Esposito at October 14, 2008 09:33 AM (MMC8r)

5 Better still, raise the minimum wage to $12 billion per hour.

We can all work for a few minutes and then retire!

Who's with me?

Posted by: Dead Career Sketch at October 14, 2008 09:36 AM (5hxyn)

6

As I see it, the problem is that money doesn't grow on trees anymore, due to the dangerous environmental policies of the Bush Administration over the last eight years 

Which is why Senator Obama and I have already proposed using leaves instead of dollars, thus stimulating the green economy and creating eleventy seventy billion new jobs in our new Obama Youth Tree Police and Glee Club mandatory civic commitment clubs.

The best part about it?  You'll never see it coming.

Posted by: Scrappy Joe Biden at October 14, 2008 09:39 AM (fg/R5)

7 The irony is that he is compared to JFK, yet his message is far from "Ask not what your country can do for you, but what you can do for your country."  In fact, Howard Stern should do a show comparing the Obama message to the JFK message, just to show how far apart the two really are.

Posted by: Unhillary at October 14, 2008 09:42 AM (jgcGm)

8
Once its confiscated and spread around, where do you get more wealth to repeat the cycle? Printing money doesn't create wealth, it just creates printed paper. Where is the example, anywhere, where this redistribution works?

Obie's soothing words will make everything fine. I would like a unicorn for the end-of-year non-denominational family gathering and gift exchange

Posted by: billypaintbrush at October 14, 2008 09:47 AM (5aBkh)

9 Someone actually have the WSJ link he mentions?

Posted by: Kerncon at October 14, 2008 09:48 AM (fYQwx)

10 "Spread the wealth around."

That cannot be done.  It is literally impossible.  Wealth is not money.  You can spread money around, temporarily at least, but not wealth. 

Plus, upon the first spreading of the first batch of money, the wealth once represented by that money GOES AWAY.   It hides.  It avoids further confiscations.  It goes elsewhere.  Or it ceases to be created.  Or all of the above. 

Wealth cannot be created by force.  It can only be created by voluntary cooperation.  And taxation (and every other form of government involvement in anything) is force.  It therefore cannot create wealth, or move it around, or anything other than destroy it.  It is really just that simple. 

Posted by: Phinn at October 14, 2008 09:53 AM (4DIx7)

11 How about a flat tax, say 15-17%, across the board. Obliterate the 600K pages of conflicting/confusing code, make it so simple a 5th grader could do it, and watch the econ grow... Naaaaaaaa


But, it takes all the power and demagoguery/class warfare out of the hands... can't have that...

Posted by: Fred Zeppelin at October 14, 2008 09:54 AM (Qs2v/)

12

The description in the chart states that this is based on a two-earner couple with two kids, one in college and one in child care. I suspect that there aren't that many families like this, so why base the chart on an unlikely family situation? Is this to take into account all of Zero's proposed tax credits? I'd like to see charts for a more normal family situation (one or two in daycare, one or two in college).

Our entire tax code is a joke. That damn line should be flat all the way across.

Posted by: Ghost of Lee Atwater at October 14, 2008 09:57 AM (sXLx/)

13 OT

Megyn Kelly just interviewed Katie Gall of ACORN on FOX after Danforth's statement.

The official Acorn stance on voter fraud? There is no voter fraud.
Acorn does voter registration. If you haven't voted yet , there is no fraud.
<gag>

Posted by: jadedinga at October 14, 2008 09:57 AM (LJnG/)

14 Goldberg has link up to that article at Corner now

Posted by: jp at October 14, 2008 10:00 AM (DFDtC)

15 Yeah, you hopey-changey Obama cult-members , you're gonna get change, good and hard.


Posted by: Dr. Remulak at October 14, 2008 10:04 AM (YmPwQ)

16

When I see Barry tell a fucking *plumber* that he has to give more to the "people behind him", it's apparent he is a complete numbskull leftist.

Great.

Posted by: Sen. Rev. Dr. E Buzz at October 14, 2008 10:05 AM (sf4Oe)

17 Spread your wealth around
Don't bogart that mound
I can show you how
Spread your wealth around

Posted by: Dan Collins at October 14, 2008 10:07 AM (SohFK)

18 I feel an invisible hand picking my pocket

Posted by: adam smith at October 14, 2008 10:09 AM (evdj2)

19 "Spread the wealth around."

My proposal: Everyone in America making less than $150,000 gets a one time payment of $100,000. The catch: No more personal payouts of any kind for a period of 25 years. At the end of 25 years, we do a special economic census and see who's got some money, and who's broke. Maybe this will help disabuse people of the idea that you can help poor people by giving them money.

Posted by: Farmer Joe at October 14, 2008 10:16 AM (nYv/9)

20 Everyone in America making less than $150,000 gets a one time payment of $100,000.

Yeah, we kind of tried that. It was called teh "Community Reinvestment Act," except instead of $100K, we gave deadbeats mortgages. And most Americans still don't realize it was a bad idea.

Posted by: Socky at October 14, 2008 10:20 AM (PLvLS)

21 I heard Mike Gallagher tick off a list of Obama's tax increases. Anyone hear it? Anyone know of such a list and can link or post it? Thanks.

Posted by: dave at October 14, 2008 10:23 AM (UV/9g)

22

The Wall Street Journal article AND the Vomit’s proposals are both misleading and disingenuous to the point of being a near term lie. A family of 4 making between 25K and 45K has a marginal tax rate of fucking ZERO. Down at the lower end that have a welfare payment through EIC that is phased out. The Vomit’s proposal is nothing more than an increase in the welfare payments to low income people. Since the Vomit is for letting the tax cuts expire it will be a tax increase for damn near everyone.

 

On top of all of that, what his plan is or is not doesn’t make a T-damn. If he wins, and the Dems maintain control of congress the push will be to enact Tax Man Rangel’s plan. That plan is liken to the old joke:

 

How much money did you make? Send it to us.

 

So the real issue is.. don’t let these damn communists get a 60 vote control.

Posted by: Vic at October 14, 2008 10:23 AM (b1ysY)

23

Please.

 

Let's not give the left the ammunition they want.

It is relevant that the propoal increases marginal rates, but it is wrong to say that his proposal increases taxes on the lower classes.

 

Phil

 

Posted by: Phil at October 14, 2008 10:27 AM (39DNf)

24 Yeah, we kind of tried that. It was called teh "Community Reinvestment Act," except instead of $100K, we gave deadbeats mortgages. And most Americans still don't realize it was a bad idea.

There were two flaws there. 1) The people behind it actually thought they were helping people, instead of conducting an economics demonstration, and 2) They conned the banks into expecting to be paid back.

Posted by: Farmer Joe at October 14, 2008 10:27 AM (nYv/9)

25

This is the real tax planthat you will get AND it should scare the shit out of everyone.

Posted by: Vic at October 14, 2008 10:30 AM (b1ysY)

26 The lesson is, more of your money in Washington's hands, so Washington can dole it back out to you ... provided you behave correctly, of course.

Posted by: Michael Rittenhouse at October 14, 2008 10:38 AM (zS9LP)

27 The problem is that you're all using the word "tax".  When you start using the word "patriotism" it all sounds way better.

Posted by: alppuccino at October 14, 2008 10:41 AM (BYezr)

28 Voter registration needs to be securely placed as is Social Security.

False registration needs to be securely prosecuted.

Voter registration drives should be terminated and prosecuted, as they only induce corruption.

Voter registration via social security number and tax records per address of voting CITIZEN, and a non-partisan photo-chip federal ID voter registration  card required of every person participating--I'd support.

Vote per issue per candidate.
Screw the parties.

Posted by: maverick muse at October 14, 2008 10:43 AM (F1b/5)

29

Uh, where is Obama on extending the child care tax credit and the Bush tax cuts, both of which are set to expire automatically.

Also it is now only 3 weeks to go and this is the first time I've seen any analysis of Obama's tax plan. I'd love to blame just the MSM but McCain and the RNC have dropped the ball. This stuff is even more important then the Ayers stuff.

Posted by: Ken at October 14, 2008 10:44 AM (vgyJ5)

30 Taxation proves patriotic as Welfare "entitlements" prove unpatriotic.

Posted by: maverick muse at October 14, 2008 10:45 AM (F1b/5)

31

Vic, yes a family making 25,000 a year with children pays taxes.

I have 2 kids and that is about my yearly incom. I pay plenty of taxes.

Yes, i get EIC like anyone with kids filing taxes. However, that does not level it out. If i could remember where my filings are i would post the figures. But poeple in that range have a rate and we pay. I pay close to 300 dollars a check between federal,state, and local taxes.

Posted by: ppp at October 14, 2008 10:46 AM (zzms8)

32 #13 - Alan Colmes said the same thing last night on H & C! I about fell out of my chair. This guy is still bitching about the 2000 election and has the balls to say that?!?

Posted by: pforeman at October 14, 2008 10:49 AM (S7Xpi)

33 Oh hell, we've all been duped ... ever since our founding fathers stepped foot on the continent.

http://tinyurl.com/35h67p

Posted by: kimberly at October 14, 2008 10:52 AM (Rpam5)

34 Acorn does voter registration. If you haven't voted yet , there is no fraud.

I heard some election official say the signing of the registration is fraud. I don't have a copy of one, but I bet it says that right on the form. Since, ACORN is either signing these or allowing others to sign them knowing they are committing fraud.

Posted by: dave at October 14, 2008 10:57 AM (UV/9g)

35 At the risk of being thought a concern troll, this conclusion doesn't quite follow from the article:

the Obama tax plan would actually increase taxes on low-income and middle-class workers

Marginal tax rates are the amount of tax you pay on the *next* dollar you earn.  Let's say you had a hypothetical tax plan that guaranteed everyone made at least $30K.  If you made $50K, you'd have a taxable income of $20K.  If you made $30K, you'd pay no taxes at all.  If you made $20K, you'd pay no taxes *and* get a $10K check from the guv'mint.  This plan would *significantly* increase the marginal rates of low-income workers -- the marginal tax rate would be 100%!  There would be no reason to work at all unless you could pull down considerably more than $30K.  But despite the fact that you have this atrocious marginal tax rate, people earning less than $30K would still pay less in taxes than they did today.  And they'd have a hell of a lot more free time!

Another example -- McCain's health care plan increases the marginal tax rates on some lower-income workers with health benefits.  But it does so because the benefits themselves are counted as income.  So if you made $30K and had $10K of employer-paid benefits, you'd have $40K of gross income.  (Effectively, it shifts the marginal tax rate curve to the left.)  But that doesn't mean his plan increasing your taxes, since the marginal rates don't account for the $5K credit.

That said, Obama is full of shit about his tax plan.  President Clinton promised a middle-class tax cut that vanished soon after he was elected because of "economic conditions".  The state of the federal budget today is a hell of a lot worse than it was in 1993, and I would expect to hear the same thing soon after election day.  If The Messiah wins, you will soon hear talk of rich people earning "tenth of a million" instead of a "quarter of a million".  Honestly, I think his tax increases on the "rich" and businesses are more about redistribution "fairness" than any potential revenue increase to the federal government.

Posted by: pbrown at October 14, 2008 10:57 AM (vxGjP)

36 Remind me why I put off working and got deep into debt to get a good education, got a good job, and now, after years of working 60+ hours a week,  make a good living despite living the tax hell of NYC.  I could have just skipped all of that and lived off of the rest of you suckers.

Wouldn't it be simpler if they just assigned me a dozen or so people to write checks to at the end of the year?

We're fucked. 

Posted by: NCYcon at October 14, 2008 11:00 AM (jLXdE)

37

So glad for the clear picture - I knew it was truly bad by the numbers, but a picture is worth a 1,000 words, you know?

Speaking of BO getting into our pockets - apparently he just can't wait until he gets into the Oval Office - And as far as legal - well, legal-shmegal - who needs legalities among friends, huh?

Check it out (found at Michelle's) "Steve and Rachel Larman say a strange credit card charge appeared on their statement this month — a $2300 donation to Barack Obama’s presidential campaign. The Larman’s say they don’t want this to be about their political affiliation, but they say they’re not about to give the Obama campaign any help from their pocketbook"

Check your statements, ya'll!

Posted by: freetofly at October 14, 2008 11:00 AM (DS6WG)

38 pbrown - Very good points.  Just added your comments to the post.

Posted by: Slublog at October 14, 2008 11:03 AM (R8+nJ)

39

Vic, yes a family making 25,000 a year with children pays taxes.

 

ppp

 

The discussion here revolved around Federal Income Tax. A family of 4 making 25K will pay ZERO federal income tax and receive back 1925 dollars via the “Bush” Child Tax Credit. (based on H&R Block tax program 2007)

 

Yes, you will have to pay SS and Medicare, but those aren’t taxes, those are “insurance” according to FDR and LBJ.

 

State taxes are dependent on which State you live in. I pay 7% State taxes and 10% sales tax, in addition to crushing property taxes on my house and auto(s). When they get too odious I plan on moving to Wyoming. Check out their taxes.

Posted by: Vic at October 14, 2008 11:07 AM (b1ysY)

40 The people behind [the Community Reinvestgment Act] actually thought they were helping people, instead of conducting an economics demonstration

What leads you to that conclusion?

The inflation of housing prices and their ultimate collapse is the OBVIOUS and INEVITABLE result of the federal government's easy-credit policy, which it implemented through Fannie Mae. 

It was unavoidable.  It's like shooting a gun into a crowd of people and then acting surprised that a bullet hit someone.  People are presumed to intend the obvious and natural results of their actions. 

Barney Frank's boyfriend was in charge of designing these easy mortgages.  I do not believe that these people had good intentions. 

Posted by: Phinn at October 14, 2008 11:38 AM (4DIx7)

41 So I'm in Burlington Coat Factory last night, and this welfare queen is in there returning two purses without a receipt for store credit. 

She's a complete piece of trash, wearing name-brand clothing, shoes, and talking LOUDLY on a cell phone the entire time the clerk is trying to help her. She has a nicer wardrobe and accessories than my wife, but she's clearly a sub-intelligent moron that couldn't hold a job outside of a seedy mall nail salon.  That's evident when she opens her mouth.

Any idiot could tell that the purses were shoplifted.  Why two purses?  Why no receipt?

Welcome to Obama's America.

Posted by: grognard at October 14, 2008 11:39 AM (5npD/)

42 pbrown is essentially correct, but doesn't address directly the method by which Obama will raise taxes after election.

What the rebate system does is it washes more money through the government laundromat before the taxpayer gets it. In essence, your taxes go up, but the government "lets" you have more back.

In the eighth month of an Obama presidency he goes on national television and informs the populace that due to financial woes, he can't extend the tax credits to anyone making over 70,000 a year pending congressional approval (and they'll pork up the bill and lower the bar to 50,000), but don't worry, he's not raising anyone's taxes, he's just limiting the number of people that the beneficent and magnanimous government institutions are able to assist. And since his salary is high, he is affected too. He feels our pain. But he has to fly off in his 747 because Sarkozy and Putin have invited him for some really excellent borscht and crepes.

So he's lying to us about his current tax plan, and when he changes it to raise taxes even more, he'll lie to us about that. If people dislike it and call for heads on pikes, he'll happily offer up Pelosi. Plenty of room under the bus.

Posted by: Commissar Vladimir at October 14, 2008 11:49 AM (VfYoj)

43

Note also that there's no discussion of "The Bush Tax Cuts" anywhere in here.

 

Those are set to sunset. Democrats have historically liked to essentially ignore those when they're calculating their cuts et cetera. _They_ aren't increasing the taxes by letting the cuts sunset, they're just letting the law proceed as written.

 

So there's an increased tax burden on 100% of wagerearners immediately before there's a lollipop given to 95% of filers.

Posted by: Al at October 14, 2008 12:11 PM (kn4q8)

44

There were two flaws there. 1) The people behind it actually thought they were helping people, instead of conducting an economics demonstration, and 2) They conned the banks into expecting to be paid back.

Sorry, this is flat wrong.  They knew right from the get go that this would end in a massive economic disaster which would allow them to do exactly what is happening right now, get the gov't, us, to redistribute the weatlth. 

Do you think it was an accident that the Dems tried to get money for ACORN in the bailout?  Do you think it is just coincidence that Obama and the Dems in Congress are whining about bailing out the poor homeowners who were victims of predatory lending?  This has been the calculation all along and damned if they aren't getting exactly what they want.

They didn't so much con the banks as they bought them off.  In order to get this crapola passed, they agreed to give the banks the much needed regulatory relief they had been begging for for years.  The banks really had no choice.  This was going to pass.  Sure, they took the regulatory relief but it wasn't as if they really had any power to do anything but.

Posted by: JackStraw at October 14, 2008 12:45 PM (VBon8)

45 jackstraw,

I think that most people think of Hanlon's razor when looking at giant government clusterfucks like the housing mess. It may be the case that there were a few involved who were designing a bomb, people who knew that the implosion was the result and desired that, but the vast majority of participants were willing dupes who wanted to appear virtuous.

This doesn't relieve them of any fault, they're still negligent idiots who should be run out on a rail.

Posted by: Commissar Vladimir at October 14, 2008 12:54 PM (VfYoj)

46 FDR hammered the low end earners and they loved him for it.  I expect a repeat with Obama. 

Posted by: Purple Avenger at October 14, 2008 01:06 PM (Xl9pj)

47

It may be the case that there were a few involved who were designing a bomb, people who knew that the implosion was the result and desired that, but the vast majority of participants were willing dupes who wanted to appear virtuous.


I'll meet you halfway.  Some at the core knew exactly what they were building, many at the middle believe in income redistribution and a few went along to appear virtuous.  Don't forget, the Senate and House banking committees, the groups that wrote this turd of a law, went under a fundamental change in '92 with the addition of people like Carol Moseley Braun (ACORN-Chicago) and one of the first beneficiaries of Obama's Project Vote.

Don't forget, the banks weren't just being forced to lend in minoirty communities, they were forced to change their lending standards to meet the quotas that the feds were holding over them.  Income verification, hell employment verification were lessened and in some cases dropped, credit histories the same, in some cases, illegal aliens were getting mortgages because social security numbers weren't even being checked.  In order to make this disaster work, Fannie and Freddie started talking in and guaranteeing mortgages that would never have passed the smell test before.  They were then securitized and floated into the financial markets.

And people were warned, repeatedly.  For anyone paying attention, this was a slow motion train wreck where house prices were skyrocketing, cheap money was available to anyone and the good times were rolling.

Overloading and crashing gov't institutions as a tool for gaining power is a core philosophy of Cloward-Piven.  Cloward-Piven is at the core of ACORN.

Posted by: JackStraw at October 14, 2008 01:19 PM (VBon8)

48 A President Obama would initially pretend to try to push for middle class tax cuts, then come back and say 'well we would have but the Bush administration and the Republican congress wasted so much money and spent so much on a quagmire in Iraq we just can't do it. All we can manage is this 'tax cut' on people who don't actually pay taxes, paid for by this tax increase by jacking taxes on the rich up to pre-2001 levels.

Posted by: Christopher Taylor at October 14, 2008 02:03 PM (0+Ggj)

49 Can't have any of you underprivledged thinking you can work your way to success -- leave that to us now! David

Posted by: LifeTrek at October 14, 2008 03:23 PM (tJTIW)

50 The enormous marginal rate of withdrawal is the Achilles' heel of any means-tested benefit. This is not a radical new idea in socioeconomics. It is a well-studied, and incontrovertible fact. Googling 'welfare trap' yields nearly four million hits. Either Obama is too stupid to know this, or he has surrounded himself with advisers that are too ignorant to know this, or he is a glad-handing demagogue with all the morals of a card-sharp. In each case, he renders himself unfit to be President. As for pbrown's comment: that is already a well-developed idea which normally goes under the monicker of Citizens Basic Income. It is usually coupled with a fairly low (20%-ish) flat tax with a BIG exemption (on the order of $20,000). But, and here are the key points, it replaces all other benefits - housing, child allowance, unemployment etc. - and it is set at the absolute bare minimum required to keep body and soul together. You won't die of kwashiorkor, but you won't be able to afford that 52" HDTV. Everyone gets it, from the bum living under a bridge to Warren Buffett. Everyone gets the same. And it is of necessity much lower than the flat tax exemption. This eliminates the marginal withdrawal rate and thus the disincentive to work. A further idea which has been floated by John Derbyshire among others is that if you are a net recipient of public money, you are not allowed to vote. It's an inversion of the old 'no taxation without representation' line. Imagine not only getting work-shy welfare bums off the electoral rolls, but all the teachers and DMV employees too.

Posted by: David Gillies at October 14, 2008 04:38 PM (2FZO3)

51 We really need to get the word out on this.  If only people got this...

Posted by: brak at October 14, 2008 04:49 PM (+LYuo)

52 So basically, the Bush Tax Cuts are better for most lower and middle class than the Obama Tax Crapola?  Go figure why you'll never hear of this in the PRESSSSSSident outside of the editorial page of the WSJ. 

Posted by: drfredc at October 14, 2008 05:42 PM (9jraf)

53 It's the same ole crap.  They will sell their souls to be elected, and they never really tell the whole truth.  And I can't believe how the public, the media and even Hollywood acts like Obama is the world's savior.  All politicians are only there to line their own pockets.  And when are the politicians going to realize that the trickle down effect does not work.  I think they should give the bailout money to the American public and let them pay off their mortgages and credit cards.  That should fix the financial problems we face.  Banks would be happy, American public would be happy.  Financial problems solved.  Not sure if there would be enough  money to actually do that, but it does sound wonderful huh.

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Posted by: seo at May 16, 2009 01:20 AM (8RZnq)

57

hopefully i can voice this-

@the first i was convenced by watching obama and otheres debating  before he  (worked )his way in to the white house

i again was convenced on his choice of words ,educational words

and  he sounded very convencing @ the time,

and i figured the way things  sounded back then before his entering the white house,i thought this person coulnt make things any worse ,he's been through basically what most of  us went through  or been through but i was definately WRONG,

thats why i voted for o bum a     ....HIS

 smooth slick uncontrolled toung ,unfortantly got my vote

just cuts /higher taxing he dont car  about the eldrly s income or people ssi/diability in come  or your income  and medical he takes  and peoples  jobs and buisnesses...

send him a tea bag!!

to end  this  he's the deviel in desgies.how do -u- sleep

from rgs

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