The Big Money Boyz are enlisting the Teabag freakshow on this for a reason. It's not just the inflation boogeyman either. They clearly want to stop any kind of economic recovery program other than tax cuts, which they know will not work. (They've been tried several times by both Bush and Obama since 2008.)So what's the real point of this?
The political strategy has long been clear --- keep the economy distressed in order to unseat Obama. The ideological purpose is clear too -- discredit Keynesianism once and for all so that democratic government will no longer have any role to play in economic crises. - Digby
It doesn't seem to me that the republicans are smart enough to do something like that. But you never know, I guess.
It's going to work, though.. that and if you look at the headlines on the "debt commission", they all refer to it as Obama's. That's great. Everyone can point to Obama as wanting to destroy Social Security and Medicare, and raise taxes.
All of this, of course, assures we can get a President Palin and really low taxes for wealthy people. In fact, might as well just do away with taxes on anyone making over 250k a year and shift it all to the middle class. That'll encourage people to start making more than 250k a year.. right? That's what Capitalism is all about!
Oh.. another awesome proposal in the Obama cat food commission is ending the mortgage interest deduction for income taxes. All that's going to do is make people pay off their mortgages.. and, of course, fuck people who don't have a few hundred thousand dollars laying around to pay of a mortgage.
I'm very sure the economy is going to suck for another two years. I'm sure the Republicans will maintain the house and pick up enough seats to control the Senate. I'm positive Obama will lose the election, and we'll get Chimpy, Mark II - The TeaBagging Edition.
It's going to be awesome.
3 comments:
Weren't you the one complaining about bizzare tax deductions like child tax credits? I figured you'd be all aboard getting rid of mortgage tax credits.
It also wouldn't affect the majority of low income households who rent. It's biggest effect would be on the lower middle class.
Overall I think the proposal is good. It increases medicaid to lower incomes while decreasing it overall.
What proposal, exactly, is good?
The problem with the child tax credit is that it's merely a bonus for procreating and is inherintly discriminatory. The mortgage tax deduction (which is not a "credit" btw) is supposed to encourage home ownership rather than renting.
It's like the massive school taxes we pay. That's bullshit.
Until the recent shit hitting the fan in the mortgage industry, it was even easy for "poor" people to own their own property. John just sold off 5 condos he owned in one complex that cost, on average, 25k each. They are in the hood, but they're roughly 1000sq foot and in pretty good shape.
It's probably true that people with zero income can't own a home, but people that work near the minimum wage can.
Ultimately, it really doesn't matter why tax deductions anyone is able to take, what matters is the net taxes a person pays and how much the government's budget is. It makes zero sense to give a shit about budget deficits in a recession, especialy with bonds at something like 1.5%. That basically means the government can borrow money for next to no cost - so a deficit doesn't mean shit.
Ultimately, they'll figure out how to destroy Medicare and Social Security.. and it won't affect me much at all. Those poor people, though, will be well and truly fucked.
In Texas, they are on the verge of simply erasing the Medicaid program, which is astonishing in it's cruelty.
The easiest way to to "fix" Social Security is to means test it. The best way to fix it is to simply fund it with money that was wasted in pointless wars.. but that ship has sailed.
On getting rid of mortgage deductions: It would help reduce demand and therefore the surplus of housing construction. As loathe as I am to bring up original intention in to most arguements, the original intent of the interest deduction was most likely business interest as most people at the time didn't have mortgages except farmers.
On poor people owning mortgages: While it certaintly is possible it isn't likely. I can't imgagine even a plurality of people in the bottom 1/4 of the tax bracket own a home. If you can find statistics I'll concede the point but I can't find rental rates broken up by tax bracket.
On school taxes: It's only bullshit in the same way that people who are hyper paranoid and safe about fire prevention still have to pay taxes to maintain a fire department. You still benefit from an educated populace even if your family doesn't have children.
On increasing the tax burden on the poor: According to the plan (slide 25 in the leaked presentation) the idea behind keeping the EITC proposal is that it would concentrate the increase in tax burden due to deduction loss at the top quintile with progressively less income loss going down the brackets. I haven't seen any numbers but I think it's resonable to assume that it would mean less money back (something you have complained about iirc) and not having to write a check for most people in that bottom bracket.
On medicare and social security:It seems that program seeks to spend less while spending more on the lowest income brackets. I see that as laudable.
The plan also reduces defense and discretionary spending.
I'll agree that the timing of the proposal is dumb. However nothing in the proposal would take into effect until 2012 and most much farther out. It's also a red herring to say that because the government can borrow a bunch of money at a low interest rate we shouldn't worry about the deficit. We don't know how long that can sustain itself and likely won't outlast the economic crisis and that's only domestic borrowing which isn't as troubling as the foreign debt we incur. I mean are you going to buy 1.5% bonds?
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