Newsmax - November Election Called Blue-State ‘Suicide Pact’

Voters in blue states who went solidly for President Obama’s re-election are ironically those who will suffer the most from the tax-the-rich policy promoted by Obama.

“With their enthusiastic backing of President Obama and the Democratic Party on Election Day, the bluest parts of America may have embraced a program utterly at odds with their economic self-interest,” observes Joel Kotkin, executive editor of NewGeography.com.

“The almost uniform support of blue states’ congressional representatives for the administration’s campaign for tax ‘fairness’ represents a kind of bizarre economic suicide pact.”

Raising taxes on the so-called rich — defined as households making over $250,000 a year — will have the strongest impact on blue states that depend largely on the earnings of high-income professionals including doctors and lawyers, entrepreneurs, and technical workers, he points out. The states and metropolitan areas that have the highest concentration of these people are overwhelmingly in the bluest states.

But the higher taxes will have far less effect on the truly wealthy Obama purports to target, who derive most of their income from capital gains and have access to offshore tax dodges.

The 10 states with the largest percentage of “rich” households under the Obama policy include New York, California, New Jersey, Connecticut, Maryland, Massachusetts, plus Washington, D.C. All of them are true-blue bastions, yet they would benefit the most from an extension of all the Bush-era tax cuts.

Moves to curb mortgage-interest deductions for affluent households would also fall most heavily on blue states, where home prices are highest and residents carry the largest mortgages on average, according to Kotkin, who also is a presidential fellow in urban futures at Chapman University and author of the book “The Next Hundred Million: America in 2050.”

Singling out “rich” taxpayers could also reduce their discretionary spending, which drives employment for lower-income workers.

Kotkin’s NewGeography article — which originally appeared in Forbes magazine — also notes that being “rich” means different things in different places. A couple with two children and a $150,000 annual income in a city in red state Texas is far “richer” in terms of housing and personal consumption than a couple earning $300,000 in blue New York City or Los Angeles.

Kotkin adds: “Perhaps the greatest irony in all this is that the Republicans, largely detested in the deep-blue bastions, are the ones most likely to fall on their swords to maintain lower rates for the mass affluent class in the bluest states and metros.”

Editor's Note:

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How President Obama Is Deceiving You On Tax Policy

From Forbes:

The central theme of President Obama’s tax policy has been that “the rich” (whatever that is supposed to mean) do not pay their fair share of federal taxes, and the middle class pays more as a result. But the CBO just issued a new report this month that proves him grievously wrong.

“The Distribution of Household Income and Federal Taxes, 2008 and 2009,” issued by CBO on July 12, reports that the top 1% of income earners paid 39% of federal individual income taxes in 2009, while earning 13% of the income. That means their share of federal income taxes was three times their share of income.

And that is down from 2007, before President Obama was even elected.  In that year, after 25 years of Reagan Republican tax policies, the top 1% paid 40% of federal individual income taxes.  That was more than double the 17.6% of federal individual income taxes paid by the top 1% when President Reagan entered office in 1981.

(Read Full Article)

Political Quote of this Election Cycle! (So Far)

by Mary Thompson:

Apparently, I’m supposed to be more outraged by what Mitt Romney does with his money than by what Barack Obama does with mine.

Death By Fairy Tale: After Occupy, "The 99% Spring" Fizzle

Dear Monetary Policy Observer

It seems somehow appropriate that this latest article is being sent out on Mayday, which it addresses in detail.  It goes over some planned "Occupy" protests for the day (and so far seems fairly prophetic in predicting their turnout...) as well as some of the harsh economic realities undermining arguments  by some elite leaders of the movement.  We hope you find this material of interest.

Sincerely,

Nicholas Arnold
American Principles In Action
www.americanprinciplesinaction.org

_______________________________________________



Ralph Benko, Contributor

4/30/2012 @ 3:25PM

Death By Fairy Tale: After Occupy, "The 99% Spring" Fizzle

Occupy Wall Street (Photo credit: Wikipedia)

May 1, International Workers Day, has been designated by the left for the “first General Strike in American History:” A Day Without the 99%.  No Work—No School—No Housework–No Shopping.  Take the streets on Tuesday!  But … the call for the General Strike is not getting traction from us — the 99%.  We whose interests it purports to represent and from whom it seeks to draw legitimacy, are decisively spurning the call.

The Occupy May Day — General Strike Facebook page shows, as of this writing, 22,998 going, out of 186,059 invitees. Even if ten times as many show up that’s a terrible fizzle.  The uprising which the left is determinedly promoting is not catching on. By comparison, Lady Gaga has over 50 million Likes (including this columnist’s, himself a little monster, Hi Stefani! Edge of Glory!).

The problem the post-Occupiers are addressing is real.  The left leadership of what it styles The 99% Spring is whip smart, disciplined, capable and elegant.  So why is their attempted movement stillborn?  The left, however noble its intentions, is flailing.  Why?  Because its proposed solution — central planning — is discredited.   The leaders of the left are trapped inside a dead fairy tale.

International Workers Day is a toxic symbol in America … and worldwide. Remember the images of missiles and soldiers beamed from Red Square with the oppressive Soviet Gerontocracy on top of Lenin’s Tomb?  The May Day celebration was the High Holy Day of Communism.  How tone deaf of the left to have chosen it.

We, the workers of the world, remember International Workers Day as synonymous with economic impoverishment, political oppression, and the suppression of civil liberties, civil rights, and human dignity. Even the nominally communist Chinese leadership recently purged Bo Xilai for attempting to revive and exalt Maoism.  Choosing May Day implies that those who are aspiring to lead the 99% are badly out of touch with us.  The choice of date presents the left’s leadership as a would-be nomenklatura, or new ruling class, rather than as in sympathy and solidarity with the masses.

Read Full Article Here http://www.forbes.com/sites/ralphbenko/2012/04/30/death-by-fairy-tale-after-occupy-the-99-spring-fizzle/

NATIONAL REVIEW: editorial pins Supercommittee failure on Dem tax donkey

The text of the editorial follows. It can be found on the National Review website at http://www.nationalreview.com/articles/283743/marines-over-medicaid-editors.

Marines Over Medicaid

To the great surprise of nobody, another blue-ribbon panel of Washington’s A-list nabobs has failed at its task: In this case, it is the so-called supercommittee charged with nudging the federal government away from the edge of the debt abyss. Investors despaired at the news, and there was talk of a second downgrade of U.S. Treasury debt.

The failure of the supercommittee is a testament to Democrats’ tax obsession. With the supercommittee having fizzled, the next step is the automatic sequestration process, which imposes 50 percent of the cuts on a program that accounts for only 20 percent of spending (national defense) while leaving the entitlements largely untouched. But the country needs the Marines more than it needs Medicaid.

The talks broke down because Democrats demanded $1 trillion in tax increases as the price of doing any deal that included entitlement savings — which is to say, as the price of doing any deal that begins to address the major drivers of spending going forward. Republicans have never quite owned up to being open to a tax increase, but that is what they are talking about when they talk about “pro-growth tax reform,” which includes broadening the tax base and eliminating some deductions and exemptions, producing a net tax increase even if tax rates stay the same or go down. But even that isn’t good enough for the Democrats, who insist that any tax increase be enacted through a relatively narrow range of options, mostly through raising tax rates on individuals with above-average incomes and on businesses that do not fall within the protective circle of Democrats’ political favoritism. (Don’t expect General Electric or the next Solyndra to start paying 35 percent, whatever else happens.) Because Republicans rightly declined to go along with this class-warfare program and insisted upon savings in entitlements, the supercommittee failed.

The sobering thing is that even the massive tax increases the Democrats wish to inflict upon the nation would not close the deficit that our entitlement programs will produce if left unreformed. A study by the International Monetary Fund estimates that, in order to keep entitlement spending at current levels while stabilizing the debt, every federal tax on the books — income tax, payroll taxes, excise taxes, etc. — would have to be raised by 88 percent. Democrats will be happy to run against entitlement reform, and they will wallpaper the airwaves with vulgar advertisements that show Paul Ryan running granny off a cliff in her wheelchair. But they are really running on an 88 percent tax hike — that or massive, unsustainable deficits.

Voters are beginning to understand as much, and that means that Republicans have a two-fold task ahead of them: The first is to overturn the automatic defense-spending cuts, locating savings elsewhere in the federal budget to offset them. Unlike most of what the federal government does, national defense is a real, pressing, national priority that is unquestionably a government responsibility. The range of threats facing the United States is broad and deep, and a single 9/11-scale attack could in financial terms alone cost the nation far more than we would save through defense cutbacks, to say nothing of the loss of life. Defense is one of the few federal functions in which budgetary concerns must perforce take a backseat to global political realities.

The same is not true of the entitlement programs, and so the second part of the Republicans’ task is to take that case to the voters in November. Most of the Republican presidential hopefuls have developed thoughtful, credible, long-term solutions to the financial imbalances of Social Security, Medicare, and Medicaid. The reforms they are proposing — means testing, gradually raising the retirement age, changing the indexing formulae — are far short of the radical changes that have been contemplated by some on the right. But properly executed they would bring the programs back into balance, a goal that is of critical importance as our population ages and the financial stress on the entitlements becomes more acute. Changing the terms of Social Security for a well-off 35-year-old decades away from collecting any benefits is not relegating granny to a cat-food diet, and Republicans should be willing to make that case.  

Meanwhile, another opportunity to control spending and rationalize the tax code has come and gone. Our supply of such opportunities is not unlimited.