Robbing Hood- Where’s the Sheriff of Nottingham When You need Him?
By
Blue Eagle Six
on September 28, 2008 at 05:50 am
Obama will only come clean about his liberalism when he thinks he is in safe territory, as he did at the San Francisco fundraiser where he trashed small-town Americans, thinking his words wouldn’t reach those he was belittling.
Nor is Obama upfront about the liberal nature of his policy proposals, choosing instead to mask their liberalism and even disguise them as conservative.
Any analysis of Obama’s experience as a Chicago community orrganizer trained in Alinsky’s radical socialist methodologies, should include the warning that “Change," a slogan frst introduced by Saul Alinsky, was nothing more than a code word for the typical income redistribution those on the left have sought since the days of Karl Marx.
Here, in Obama’s proposal for increasing the capital gains tax, we find proof of the point.
On September 18, 2007, Obama laid out his tax fairness plan for the middle class. He proposed changing the long-term capital gains tax rate from 15 percent to 28 percent, nearly doubling it. Characteristically, Obama typified the capital gains tax as being one of the $1 trillion in “corporate loopholes and tax havens” he feels are somehow unfair and should be captured as• tax revenue.
His goal, he said, is to cause “a shift in our tax values that disproportionately benefits the wealthiest Americans.”
In introducing his plan to increase capital gains, Obama played to the “tax the rich” themes that critics in the business world have associated for decades with the plans of Democratic Parry politicians to redistribute wealth to their large client base of welfare-dependent poor.
James Pethokoukis, a reporter for U.S. News & World Report, renamed Obama’s plan from the senator’s proposed “Tax Fairness for the Middle Class” to what it really is-"Ways in Which Government Can Collect More Taxes to Pay for New Spending." ">-"Ways in Which Government Can Collect More Taxes to Pay for New Spending.”
Pethokoukis saw Obama’s proposal as symptomatic of the Democratic primary candidates “scrambling to figure out ways to plausibly pay for new healthcare, education, and infrastructure spending if elected.”
Pethokoukis then pointed to the result of most Democratic plans to increase corporate taxes: the government ends up collecting less capital gains tax revenue, not more. Why?
The answer is fairly simple: under higher capital gains tax rates, investors realize their gains before the higher capital gains rates kick in. Moreover, as long as the higher rates remain in effect, investors and corporate boards make decisions to reduce the amount of capital gains that have to be realized.
One clear way to accomplish this goal is for investors and corporations to cut back on investments. Discourage investments and fewer capital gains taxes will be paid. As a result, higher capital gains tax rates tend to produce less capital gains tax revenue, not more.
The economics of this principle have been proved repeatedly in the two decades since Reagan was president.
Ed Morrissey, posting on the Michelle Malkin blog, HotAir.com, took Obama to task for missing this point altogether in his presidential primary debate with Hillary Clinton in Philadelphia on April 16, 2008.
During the debate, ABC News moderator Charles Gibson pointed out statistics from changes in the capital gains tax, including reductions in the capital gains tax put- in place by President Clinton, showing that reductions in capital gains tax rates produce more tax revenue and that the opposite happens, tax revenue goes down, when capital gains tax rates are increased.
As Morrissey pointed out, Obama shifted ground in giving his answer, arguing that “fairness” was the real reason he wanted to raise capital gains taxes.
“Well, Charlie,” Obama began his answer, “what I’ve said is that I would raise the capital-gains tax for purposes of fairness.
We saw an article today which showed that the top 50 hedge fund managers made $29 billion last year-$29 billion for 50 individuals. And part of what has happened is that those who are able to work the stock market and amass huge fortunes on capital gains are paying a lower tax rate than their secretaries. That’s not fair.”
“The higher priority for Obama isn’t to raise revenue; it’s to ensure fairness,” Morrissey properly pointed out.
“In order to do that, he will have the government take a bigger share of the gains and redistribute them through social programs to others.
The pretense of having more money acts as a veneer for good, old-fashioned redistributionism.”
“Obama’s blindness on capital gains reveals a hard-Left mindset,” Morrissey wrote. “He sees investors always profiting and never losing, while the people who work at jobs created by successful investment as victims of this exchange rather than the beneficiaries of it.”
Yet the secretary in Obama’s example earns an income because investors have risked capital to create her job. When investment is discouraged, the economy as a whole falters, creating fewer jobs for secretaries, as well as all other workers.
“The surest way to start an economic disaster is to increase penalties for investment,” Morrissey correctly concludes.
This Obama proposal is certain to look like amateurism at best to successful investors, experienced corporate executives, and economists. To the extent Obama manages to convince these more economically sophisticated voters his economic naiveté truly reflects his genuine lack of experience-both in politics and in business-Obama will lose another core group of voters he may not be able to afford losing.
Nor is Obama upfront about the liberal nature of his policy proposals, choosing instead to mask their liberalism and even disguise them as conservative.
Any analysis of Obama’s experience as a Chicago community orrganizer trained in Alinsky’s radical socialist methodologies, should include the warning that “Change," a slogan frst introduced by Saul Alinsky, was nothing more than a code word for the typical income redistribution those on the left have sought since the days of Karl Marx.
Here, in Obama’s proposal for increasing the capital gains tax, we find proof of the point.
On September 18, 2007, Obama laid out his tax fairness plan for the middle class. He proposed changing the long-term capital gains tax rate from 15 percent to 28 percent, nearly doubling it. Characteristically, Obama typified the capital gains tax as being one of the $1 trillion in “corporate loopholes and tax havens” he feels are somehow unfair and should be captured as• tax revenue.
His goal, he said, is to cause “a shift in our tax values that disproportionately benefits the wealthiest Americans.”
In introducing his plan to increase capital gains, Obama played to the “tax the rich” themes that critics in the business world have associated for decades with the plans of Democratic Parry politicians to redistribute wealth to their large client base of welfare-dependent poor.
James Pethokoukis, a reporter for U.S. News & World Report, renamed Obama’s plan from the senator’s proposed “Tax Fairness for the Middle Class” to what it really is-"Ways in Which Government Can Collect More Taxes to Pay for New Spending." ">-"Ways in Which Government Can Collect More Taxes to Pay for New Spending.”
Pethokoukis saw Obama’s proposal as symptomatic of the Democratic primary candidates “scrambling to figure out ways to plausibly pay for new healthcare, education, and infrastructure spending if elected.”
Pethokoukis then pointed to the result of most Democratic plans to increase corporate taxes: the government ends up collecting less capital gains tax revenue, not more. Why?
The answer is fairly simple: under higher capital gains tax rates, investors realize their gains before the higher capital gains rates kick in. Moreover, as long as the higher rates remain in effect, investors and corporate boards make decisions to reduce the amount of capital gains that have to be realized.
One clear way to accomplish this goal is for investors and corporations to cut back on investments. Discourage investments and fewer capital gains taxes will be paid. As a result, higher capital gains tax rates tend to produce less capital gains tax revenue, not more.
The economics of this principle have been proved repeatedly in the two decades since Reagan was president.
Ed Morrissey, posting on the Michelle Malkin blog, HotAir.com, took Obama to task for missing this point altogether in his presidential primary debate with Hillary Clinton in Philadelphia on April 16, 2008.
During the debate, ABC News moderator Charles Gibson pointed out statistics from changes in the capital gains tax, including reductions in the capital gains tax put- in place by President Clinton, showing that reductions in capital gains tax rates produce more tax revenue and that the opposite happens, tax revenue goes down, when capital gains tax rates are increased.
As Morrissey pointed out, Obama shifted ground in giving his answer, arguing that “fairness” was the real reason he wanted to raise capital gains taxes.
“Well, Charlie,” Obama began his answer, “what I’ve said is that I would raise the capital-gains tax for purposes of fairness.
We saw an article today which showed that the top 50 hedge fund managers made $29 billion last year-$29 billion for 50 individuals. And part of what has happened is that those who are able to work the stock market and amass huge fortunes on capital gains are paying a lower tax rate than their secretaries. That’s not fair.”
“The higher priority for Obama isn’t to raise revenue; it’s to ensure fairness,” Morrissey properly pointed out.
“In order to do that, he will have the government take a bigger share of the gains and redistribute them through social programs to others.
The pretense of having more money acts as a veneer for good, old-fashioned redistributionism.”
“Obama’s blindness on capital gains reveals a hard-Left mindset,” Morrissey wrote. “He sees investors always profiting and never losing, while the people who work at jobs created by successful investment as victims of this exchange rather than the beneficiaries of it.”
Yet the secretary in Obama’s example earns an income because investors have risked capital to create her job. When investment is discouraged, the economy as a whole falters, creating fewer jobs for secretaries, as well as all other workers.
“The surest way to start an economic disaster is to increase penalties for investment,” Morrissey correctly concludes.
This Obama proposal is certain to look like amateurism at best to successful investors, experienced corporate executives, and economists. To the extent Obama manages to convince these more economically sophisticated voters his economic naiveté truly reflects his genuine lack of experience-both in politics and in business-Obama will lose another core group of voters he may not be able to afford losing.
