Taxes raised with no fiscal responsibility

(PNI) Three-fourths of households will see their taxes go up on the promise that spending will be looked at in the near future. Huh?

Ronald Reagan raised taxes on the promise that for every dollar of tax increase there would be $3 of future spending decreases. George H.W. Bush raised taxes on the promise that for every dollar of tax increase there would be $2 of future spending decreases. In both instances, the taxes were immediately raised, but the Democrats reneged and spending cuts never came about.

President Barack Obama and the Democratic Party have never shown the slightest interest or the required courage necessary to begin genuine debt reduction. They skirted the law by not passing a budget in three years. The president ignored his own committee's report on how to reduce the deficit.

Instead, Democrats continue to divide Americans by playing class warfare and promoting the crass emotion of jealousy. Individual initiative and responsibility no longer apply.

-- Lowell Ziemann, Scottsdale

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Most in poll say the rich don't pay enough taxes

WASHINGTON – As the income gap between rich and poor widens, a majority of Americans say the growing divide is bad for the country and believe that wealthy people are paying too little in taxes, according to a new survey.

Karen Bleier, AFP/Getty Images

Karen Bleier, AFP/Getty Images

The poll released Monday by the Pew Research Center points to a particular challenge for Republican presidential candidate Mitt Romney, whose party's policies are viewed by a wide majority as favoring the rich over the middle class and poor.

The poll found that many Americans believe rich people to be intelligent and hardworking but also greedy and less honest than the average American. Nearly six in 10, or 58%, say the rich don't pay enough in taxes, while 26% believe the rich pay their fair share and 8% say they pay too much.

Even among those who describe themselves as "upper class" or "upper middle class," more than half — or 52% — said upper-income Americans don't pay enough in taxes; only 10% said they paid too much. This upper tier was more likely to say they are more financially secure now than 10 years ago — 62%, compared to 44% for those who identified themselves as middle class and 29% for the lower class. They are less likely to report problems in paying rent or mortgage, losing a job, paying for medical care or other bills and cutting back on household expenses.

The findings come at the start of this week's Republican National Convention and as both Romney and President Barack Obama seek to appeal to a broad swath of financially struggling voters who identify as middle class. Romney supports an extension of Bush-era tax cuts for everyone including the wealthiest 2 percent, and says his policies will benefit the middle class by boosting the economy and creating jobs.

"The fact that Romney may be viewed as wealthy doesn't necessarily pose problems for his candidacy," said Kim Parker, associate director of Pew Social & Demographic Trends, noting that people see the wealthy as having both positive and negative attributes. "The challenge for Romney lies more in the fact that large majorities say if he is elected president, his policies would likely benefit the wealthy."

The results reinforce a tide of recent economic data showing a widening economic divide. America's middle class has been shrinking in the stagnant economy and poverty is now approaching 1960s highs, while wealth concentrates at the top. A separate Pew survey earlier this year found that tensions between the rich and poor were increasing and at their most intense level in nearly a quarter-century.

In fact, well-off people do shoulder a big share of the tax burden. Though households earning over $1 million annually comprise just 0.3% of all taxpayers, they pay 20% of all federal taxes the government is projected to collect this year, according to the Tax Policy Center, a nonpartisan group that studies tax policy. The figures included income, payroll and estate taxes. In contrast, households earning $50,000 to $75,000 a year accounted for 12% of taxpayers and contributed 9% of federal taxes, the center's data showed. Some 46% of households pay no federal income tax at all, although they do pay payroll, excise and other taxes.

The American income tax system has long been designed to be progressive, meaning higher earners are expected to pay a greater share of their income than those making less.

In this year's tax battle in Washington, Obama wants to let the current top rate of 35% for high earners rise to 39.6% next year. Congressional Republicans would reduce the top rate to 25%, while Romney would reduce it to 28%. Romney and GOP lawmakers have said they would eliminate some deductions to pay for the rate reductions, but have not specified which ones.

According to Pew's latest findings, about 63% of Americans say the GOP favors the rich over the middle class and poor, and 71% say Romney's election would be good for wealthy people. A smaller share, 20%, says the same about the Democratic Party. More Americans — 60% — say if Obama is re-elected his policies will benefit the poor, while half say they'll help the middle class and 37% say they'll boost the wealthy.

"The Great Recession was not an equal opportunity disemployer," said Sheldon Danziger, a public policy professor at the University of Michigan who describes the gap between rich and poor as the widest in decades. "College graduates, whites and middle-aged workers had fewer and shorter layoffs than high school graduates, blacks, Hispanics and younger workers. And, only a small percentage of the rich work in the hardest-hit industries, like construction and manufacturing."

About 65% of Americans say the gap between rich and poor has gotten wider in the past decade, while 20% believe it has stayed the same and 7% say the gap has gotten smaller. Separately, 57% say a widening income gap is a bad thing for society; just 3% say it is a good thing.

Asked to estimate how much a family of four would need to earn to be considered wealthy in their area, the median amount given by survey respondents was $150,000. For middle class, the median amount was $70,000.

Many Americans see rich people as more likely to be intelligent (43%) and hardworking (42%) than average Americans. But the rich are also seen as more likely to be greedy (55%). Thirty-four percent of those surveyed say the rich are less likely to be honest than the average person; just 12% say the rich are more likely to be honest.

The Pew survey involved telephone interviews with 2,508 adults conducted from July 16 to 26. It has a margin of error of 2.8 percentage points.

The AP's Jennifer Agiesta and Alan Fram contributed to this report.

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Democrats Propose $1.5 Trillion in New Taxes (ContributorNetwork)

COMMENTARY | With the statutory deadline approaching in less than a month, congressional Democrats still have their heads buried in the sand when it comes to the federal budget.

Reuters reported Thursday that the super committee Democrats introduced a $3 trillion savings package that aims to far exceed the $1.2 trillion they are required to cut before Thanksgiving. The plan was dead on arrival, according to Republican staffers for the ultra-secret committee.

Democrats seek $1.5 trillion in new revenues from tax increases and new taxes. What part of "no new taxes" do they not understand? The House is not going to pass any new revenues - they have been perfectly clear on that all year. For Dems to present a plan that calls for 50 percent of the proposed savings to come from new revenue is a waste of breath in proposing it, and a gallant waste of time should any committee give it debate time.

The proposal doesn't have the support of all Democrats on the special committee, and is likely to have problems with the Democratic leadership. House Minority Leader Nancy Pelosi, D-Calif., has repeatedly said she will not consider cuts to Medicare and Medicaid, although The Hill reports she is mum on the subject today wanting to "wait until I can see the whole package." That's an interesting comment from the former speaker who insisted the Congress pass Obamacare before they knew what was in the bill.

Nearly $100 billion in Medicaid cuts are proposed, as well as long term Medicare cuts. The details were carefully omitted from leaks to the media. The cream of the plan includes another $300 billion stimulus plan.

Basically, the Democrats are proposing massive tax hikes that cannot pass either chamber. They are proposing social program cuts that even their own leadership will not support, therefore effectively killing it in the Senate. And, they are proposing new stimulus spending that Republicans will not allow to happen. The time it took to design the plan was a further waste of government spending.

House Speaker John Boehner told Seattle Times that it would be difficult to pass any plan from the super committee, but he would strive to accomplish some compromise. The clock is ticking - the committee needs to get serious and make some concerted tough decisions. Then they need to muscle it past their respective caucuses.

Dan McGinnis is a freelance writer, published author and former newspaper publisher. He has been a candidate, campaign manager and press secretary for state and local political campaigns for more than 30 years.

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Deficit-cutting panel looking at benefits, taxes (AP)

By DAVID ESPO and ANDREW TAYLOR, Associated Press David Espo And Andrew Taylor, Associated Press – Thu Oct 27, 5:55 pm ET

WASHINGTON – Rival deficit-cutting plans advanced by Republicans and Democrats on Congress' secretive supercommittee would both mean smaller-than-expected cost of living benefit increases for veterans and federal retirees as well as Social Security recipients and bump up taxes for some individuals and families, according to officials familiar with the recommendations.

In all, the changes would reduce deficits by an estimated $200 billion over a decade, a fraction of the committee's minimum goal of $1.2 trillion in savings.

A final decision by the panel on legislation to reduce deficits is still a few weeks off, and given the political difficulties involved, there is no certainty that the six Republicans and six Democrats will be able to agree.

The two sides exchanged initial offers earlier this week, and each side swiftly found fault with the others' proposal in the privacy of the committee's rooms as well as in public.

House Speaker John Boehner, R-Ohio, noting published reports that Democrats are seeking $3 trillion in higher taxes, said, "This is the same number that was in the president's budget, the same number that — that they — I don't know that they found any Democrats in the House and Senate to vote for."

"I don't think it's a reasonable number," he said. Boehner also chided Democrats for recommending $50 billion in savings from Medicaid over the next decade, well below what Republicans are seeking.

"Let's understand over the next 10 years, we're going to spend $10 trillion on Medicaid. I just think there's a lot more room there to help find common ground," he said.

At the same time, Boehner emphasized, "I am committed to getting to an outcome" that clears the committee and Congress. The speaker negotiated privately with President Barack Obama over the summer in deficit-reduction talks that failed to produce an agreement.

At a news conference of her own, House Democratic leader Nancy Pelosi of California said she wanted a compromise that was "big, bold and balanced," a phrase that Democrats use to convey an insistence on higher tax revenue.

She pointedly declined to embrace what Democrats had presented to the supercommittee. She called it "Sen. Baucus' package," a reference to the Montana Democrat and chairman of the Senate Finance Committee. That ran directly counter to his aides' statements earlier in the week that he was speaking for a majority of Democrats on the panel — and tacit confirmation that at least two of the party's members had not signed on as supporters.

Ironically, while the Republican and Democratic panel members remain far apart, one of the relatively few items in common was a potentially controversial recommendation to change the calculation for annual cost-of-living increases in federal programs as well as the yearly adjustments in income tax brackets.

According to the nonpartisan Congressional Budget Office, the recommended change "produces lower estimates of inflation than the traditional" measurement of the Consumer Price Index. Since December 2000 the difference on average has amounted to 0.3 percentage points, according to the agency.

A decision to base annual cost of living increases on the new calculation would lower Social Security costs by $108 billion over a decade, and the impact on benefits for federal civilian and military pension programs and veterans' benefits would save an additional $23 billion, according to calculations made in February 2010.

Congressional experts said the list of federal programs that would be affected is extensive, and included Medicare, Medicaid, food stamps and more, but the absence of a written description by either side in the deficit negotiations makes a complete listing impossible.

Officials in both parties said their plans would affect income tax brackets, which currently are adjusted annually to make sure that inflation alone does not expose more earnings to taxation.

By slowing the rate of the adjustment, more income would be taxed than is currently forecast, a change that Congress' Joint Tax Committee recently estimated would produce $59.6 billion in revenue to the Treasury over a decade.

Just as changes to Social Security and benefit programs are politically problematic for Democrats, tax increases are difficult for Republicans.

Americans for Tax Reform, an organization led by anti-tax advocate Grover Norquist, earlier this year said slowing the pace at which tax brackets are adjusted for inflation "would most certainly be a tax hike."

There was one caveat, though.

"This idea can of course be part of a discussion of comprehensive and revenue-neutral tax reform, but stand-alone it is a tax hike."

Both Republicans and Democrats included tax reform in their presentations inside the supercommittee, and the issue has great political appeal.

But the two sides differ dramatically on the details. Democrats called for tax reform that would generate an additional $1 trillion in revenue over a decade, while Republicans said they envisioned no increase.

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Democrats Need a 12-Step Recovery Program on Taxes - CNBC

Here's a question: Why is repealing the Bush tax cuts such a constant obsession for the Democratic Party? Especially the top rates for the most successful earners and small business entrepreneurs?

It seems this is the Democratic answer for every single issue, every problem, every debate.

This, of course, saddens me enormously.

And so, always ready to help, I am recommending a 12-Step program to help them overcome their anger, resentment, and obsession over the Bush tax cuts. Democrats really need a Higher Power on this.

First, when tax rates were lowered across-the-board in mid-2003, the incentive effect kicked in to jump-start the economy immediately. Over the next four and a half years, before the financial meltdown slammed the economy—and that was a credit event, not a fiscal one—8.2 million jobs were created.

Jobs essentially rose for about fifty consecutive months.

Non-farm payrolls rose from just under 130 million to just over 138 million. Don’t believe me? You can look it up. This sort of job creation is exactly what President Obama would love to see happen now.

And, while jobs rose, the government took in more revenues. As a share of GDP, revenues rose from 16.2 percent to 18.5 percent. Simply put, supply-side tax cuts were the single best economic policy President Bush implemented.

Elsewhere, President Bush overspent and overregulated. And yes, the dollar collapsed on his watch. And from Fannie Mae to the Federal Reserve, the housing bubble was born.

But the tax cuts? They worked. And that's my point. 

Questions? Comments, send your emails to:document.write("");document.write("lkudlow"+"@"+"kudlow.com");document.write('');

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