Tax Cut Chicanery (2)

On Sunday Senator Charles Schumer appeared on Face the Nation and was asked about Obama’s demand that Congress increase tax rates on high income Americans.   His response in part was:

…we have a big deficit problem. We have a great jobs problem. Better to put the money into deficit reduction creating jobs than give it to the millionaires and billionaires.

Schumer ran two phrases together as if doing so made sense:

  • “put the money into deficit reduction,” and
  • “creating jobs.”

His obvious motive was to deceive the audience in 5 ways:

  1. Schumer’s operating assumption, that a higher tax rate will produce more revenue, is not the verifiable certainty he wants you to believe it is.  As the chart shows, tax revenue from the rich declined from 2000 to 2003 when the tax rates Obama wants to reimpose were in effect.  Then, after the lower, Bush tax rates were enacted, tax revenue from the rich went up, not down, for four years.  Due to the financial crisis and recession, revenue from all tax brackets decreased in 2008, the latest statistics available from the IRS.
  2. The phrase “deficit reduction,” when spoken by Charles Schumer is a meaningless slogan.  He has always supported massive spending initiatives, without any consideration of the deficit.  If he did care about the deficit he  would not have supported President Obama’s $787 billion stimulus, enacted 22 months ago on the promise that – somehow – it would create jobs.
  3. There is no logical argument leading to the conclusion that a tax increase on high income people – who, as business owners and investors are the source of the capital that funds business start ups and expansion – will result in more jobs.  Leaving less capital in their hands can only result in fewer jobs.
  4. By putting these two phrases together Schumer suddenly reversed his and Obama’s position of the past two years, that massive government spending of borrowed money was the formula for job creation and prosperity.  Indeed deliberate deficit spending to create jobs was the stated goal of the Obama stimulus!
  5. The government will not, by maintaining the top tax brackets at the same rates that have been in effect since 2003, “give” money to millionaires.   The money in question belongs to the tax payer who earned it, not to the government.  The question is not how much to “give” to taxpayers, but how much of the fruits of their labors and investments will be taken away from them

8 Comments so far

  1. Thousand Flowers Blooming on November 15th, 2010

    The bush jobs record was pathetic. These tax give aways have not created any jobs in ten years. No reason to believe they ever will. This argument is nonsense.

    Clearly millions of middle class voters have been duped by Rush and Fox news if they still think trickle down works.

  2. Gabriel on November 16th, 2010

    It sure is hard to understand why the Republicans fight so much harder for the top 2% than for everyone else. How many times do we have to live through the right wing cycle of failure, the theory that if you give more to the rich they’ll “float all boats”?

    The middle class is being strangled while those tea party idiots cry for the rich!

  3. Drew on November 16th, 2010

    Well, well, well. Thousand Brains Cels (on his best day) returns.

    How’d you like the elections, dumbo? Apparently there are a number of folks who disagree with you.

    Fact: The unemployment rate under Bush was indistinguishable from that under Clinton.

    Fact: the current unemployment rate is far higher than published, and far higher than promised by the Obama administration.

    Laughing out loud: the voters were duped by Rush and Fox. All you need now is to invoke racism, TFB. You are pathetic. The people have spoken. The Dems are done; the Obama presidency is a horrific failure. Deal with it.

  4. Thousand Flowers Blooming on November 17th, 2010

    Drew –
    Are you crazy? Bush didn’t create any jobs in 8 years of piling up trillions of debt to pay for handouts for the top 1%.

    The only jobs Bush created were Halliburton jobs sucking at the pentagon teet while middle class menn and women who couldn’t find a job fought in a war against WMDs that didn’t exist.

    Turn off Fox and get some accurate information.

    You didn’t answer the question yet. How about all those jobs you created in your small business with the Bush tax cuts? Jobs here in America, that is. what is your “small business”? hedge fund? health Insurance lobbyist? predatory mortgages?

  5. Drew on November 17th, 2010

    Speaking of crazy, TFB trots out all the usual buzz words and tripe.

    1. Go look up the unemployment rate, TFB. Its a simple Google search. And its a fact.

    2. “The only jobs Bush created were Halliburton jobs sucking at the pentagon teet while middle class menn and women who couldn’t find a job fought in a war against WMDs that didn’t exist.”

    Were you drunk when you wrote this?

    3. “Turn off Fox and get some accurate information.”

    I don’t watch Fox. But apparently you do, since you obviously have a point of view on them.

    4. “How about all those jobs you created in your small business with the Bush tax cuts? Jobs here in America, that is. what is your “small business”? hedge fund? health Insurance lobbyist? predatory mortgages?”

    LOL. The only thing you left out is axe murderer. You show yourself to be a fool when you make such wild accusations.

    Here’s a sample: a) plastic injection molder, 2) plastic injection blow molder, 3) horizontal work surfaces for laboratories, 4) neoprene and other high tech materials used for barrier properties in consumer electronics, 5) roofing fabric, 6) outdoor illuminated signage. And so it goes.

    The smallest about $30MM in revenue, the largest about $130MM. And what do you know……no predatory mortgages or health insurance lobbying.

    Oh, and I dare say, I’ve probably created more jobs the last 10 years than you could hope to in 10 lifetimes.

    But I have to give you credit for one thing. You’ve got the mindless lefty cliches down pat.

  6. Thousand Flowers Blooming on November 17th, 2010

    With six businesses – if you’re not B.Sing – you can afford to pay a bit more to bring down the deficit.

    Still no answer. Do you make your molders and roofing fabrics in Mexico? Or Did you hire any Americans with your Bush tax cut? Do you pay for health insurance? Do you pay a living wage?

  7. Jason on November 18th, 2010

    Mr. Flowers is a gullible stooge of the left. During the Bush years Unemployment never rose above 6% until the end when Obama’s and Dodd’s mortgage buddies caused the financial mushroom cloud. Obama and Dodd got more money from Countrywide than any other politicians.

    Obama wishes he had a jobs record as good as Bush’s.

    I need a job now. I made good money in web site design while Bush was in office. Since Obama took over I lost my job and lost my house. I used to drive a Corvette. Now I have a 96 Honda. I’m lucky to have a place to live with my brother. He still has a house because his wife works for the government. It feels terrible that she works every day while two of us have nothing to do.

    I was mad at Bush too. But all Obama does is blame Bush. That doesn’t create any jobs. We’re still in this deep hole after two years of blaming Bush. When does Obama admit he did this?

    Thats why I’m against Obama’s tax increase on small businesses. I never got a job from someone whose business profit was taxed away and spent by Democrats on stupid programs and to bail out their friends on Wall St.

    I wish idiots like thousand flowers would just shut up.

  8. Gabriel on November 18th, 2010

    Jason:
    I’m sorry for all your losses but Bush policies got us into this, not Obama. He wasn’t President until several months after the crisis began. Obama is trying to get us out by fixing the unbalanced economy of the Bush years.

    The rich aren’t creating any jobs. If they were maybe you wouldn’t have suffered so much. What is the justification for us borrowing a trillion dollars to keep giving them a huge tax break?

    If the rich do create any jobs they will be in China not here.