Archive for the ‘Bush Tax Cuts’ Category


Monday, July 18th, 2011
The Wall Street Journal

  • JULY 15, 2011

The real reason the U.S. could lose its AAA rating.

  • So the credit-rating agencies that helped to create the financial crisis that led to a deep recession are now warning that the U.S. could lose the AAA rating it has had since 1917. As painfully ironic as this is, there’s no benefit in shooting the messengers. The real culprit is the U.S. political class, especially the President who has presided over this historic collapse of fiscal credibility.

Moody’s and the boys are citing the risk of a default on August 2 as the proximate reason for their warning. But Americans should understand that the debt ceiling is merely the trigger. The gun is the spending boom of the last three years and the prospect that Washington lacks the political will to reduce it in the years to come.

1downgradeOn spending, it is important to recall how extraordinary the blowout of the last three years has been. We’ve seen nothing like it since World War II. Nothing close. The nearby chart tracks federal outlays as a share of GDP since 1960. The early peaks coincide with the rise of the Great Society, the recession of 1974-75, and then a high of 23.5% with the recession of 1982 and the Reagan defense buildup.

From there, spending declines, most rapidly during the 1990s as defense outlays fell to 3% of GDP in 2000 from its Reagan peak of 6.2% in 1986. The early George W. Bush years saw spending bounce up to a plateau of roughly 20% of GDP, but no more than 20.7% as recently as 2008.

Then came the Obama blowout, in league with Nancy Pelosi’s Congress. With the recession as a rationale, Democrats consciously blew up the national balance sheet, lifting federal outlays to 25% in 2009, the highest level since 1945. (Even in 1946, with millions still in the military, spending was only 24.8% of GDP. In 1947 it fell to 14.8%.) Though the recession ended in June 2009, spending in 2010 stayed high at nearly 24%, and this year it is heading back toward 25%.




Thursday, June 30th, 2011
The Wall Street Journal

  • JUNE 29, 2011

The return of the deduction phase-out gambit.

  • The White House wants Republicans to agree to tax increases that no one wants to call tax increases, and for an insight into this political method let’s focus on one proposal in particular—the phase-out of itemized deductions for upper-income taxpayers. We hope the tea party is paying attention, because this kind of maneuver is why people hate Washington.

The idea is that once taxpayers earn a certain amount of money (say, $200,000), they would begin to lose the value of the various deductions they’re entitled to under the law. These include such IRS Form 1040 line items as the personal exemption, the deductions for state taxes and charitable contributions, even those for spouses and children. Earn enough money and soon the value of those deductions goes to zero.

The political point of this exercise is to raise marginal tax rates without appearing to do so. The top statutory individual rate would remain at 35%, so the politicians could claim they hadn’t raised rates. But for those losing their deductions, the marginal rate would increase by between one and two percentage points until the phase-outs were complete.

We raise the alarm now because this sneaky bit of political fiddling last became law during a previous bipartisan budget summit—in 1990. Democrats proposed it then, too, and President George H.W. Bush and his budget chief Dick Darman agreed to it so they could appear to be raising tax rates less than they really were. (more…)



Saturday, May 28th, 2011
The Wall Street Journal

  • MAY 26, 2011

Democrats have said they only intend to restore the tax rates that existed during the Clinton years. In reality they’re proposing rates like those under President Carter.

Media reports in recent weeks say that Senate Democrats are considering a 3% surtax on income over $1 million to raise federal revenues. This would come on top of the higher income tax rates that President Obama has already proposed through the cancellation of the Bush era tax-rate reductions.

If the Democrats’ millionaire surtax were to happen—and were added to other tax increases already enacted last year and other leading tax hike ideas on the table this year—this could leave the U.S. with a combined federal and state top tax rate on earnings of 62%. That’s more than double the highest federal marginal rate of 28% when President Reagan left office in 1989. Welcome back to the 1970s.

Here’s the math behind that depressing calculation. Today’s top federal income tax rate is 35%. Almost all Democrats in Washington want to repeal the Bush tax cuts on those who make more than $250,000 and phase out certain deductions, so the effective income tax rate would rise to about 41.5%. The 3% millionaire surtax raises that rate to 44.5%. (more…)



Thursday, April 14th, 2011

Published on The Weekly Standard (

No hope, no change.

Fred Barnes

April 13, 2011 4:02 PM

President Obama always lets you down. Just when you think he’s ready to deliver a lofty speech chocked with specifics on handling the spending and debt emergency, he offers up a hyper-partisan attack on the leading Republican proposal, gives practically no details of his own plan, and then sanctimoniously puts himself on the side of preserving “the American dream for future generations.”

Obama didn’t rise to the occasion. He actually sank, as he did two months ago when he released a 2012 budget that would increase spending by $40 billion and double the national debt over the next decade.

Let me list the lowlights of the president’s speech this afternoon at George Washington University:

♦ The problem is George W. Bush’s fault. This is a hardy perennial of Obama’s. “America’s finances were in great shape by the year 2000,” he said. Then spending skyrocketed due to two wars and a prescription drug program and “we didn’t pay for any of this new spending.” The fiscal problem was made worse “with trillions of dollars in unpaid for tax cuts.” He didn’t mention that discretionary spending soared on his watch by 11 percent in 2009 and 14 percent in 2010, up from 6 percent in 2008, the last Bush year. Nor did he concede that Democrats wanted a bigger, more expensive Medicare drug program. (more…)



Friday, January 21st, 2011
  • The Wall Street Journal
    • JANUARY 19, 2011

    Obama’s Rules Revelation

    The era of big regulation is over. Or is it?

    • President Obama took to these pages yesterday to announce a new executive order to restore “balance” to federal regulation and root out rules that impede job creation and economic growth. If he means it, this will be one of the great policy walkbacks in American history. The rest of us should stay in a Missouri state of mind.

    Substance aside, Mr. Obama’s new order is a significant symbolic concession. The White House is admitting that after an historic voter rebuke due in part to its regulatory overkill, it must show some willingness to pull back the throttle. The President is gradually conceding the conservative and business critique of his first two years, even if the concessions so far are mostly in style and rhetoric.

    This rules rethink is akin to the Democratic Congress’s vote to extend all the Bush-era tax rates while being forced to admit that raising them would hurt the recovery. Liberals have spent years dismissing warnings that their agenda created uncertainty and harmed the economy, and then they wake up to find their leader on the Wall Street Journal editorial page disowning “unreasonable burdens on business—burdens that have stifled innovation and have had a chilling effect on growth and jobs.”

    The real test will be how Mr. Obama defines “unreasonable.” The executive order he signed yesterday instructs federal agencies to weigh the costs and benefits of proposed rules and choose the least burdensome alternative. Yet that merely reiterates an executive order President Clinton signed in 1993 and that was supposed to be governing the Obama Administration all along. Mr. Obama also ordered a “retrospective analysis” of all rules to streamline or repeal the damaging ones.

    1regs (more…)



    Monday, January 3rd, 2011
    The Miami Herald

    Dave Barry’s 2010 Year in Review

    By Dave Barry

    Jack Ohman / MCT
    Let’s put things into perspective: 2010 was not the worst year ever. There have been MUCH worse years. For example, toward the end of the Cretaceous Period, the Earth was struck by an asteroid that wiped out 75 percent of all the species on the planet. Can we honestly say that we had a worse year than those species did? Yes we can, because they were not exposed to Jersey Shore.So on second thought we see that this was, in fact, the worst year ever. The perfect symbol for the awfulness of 2010 was the BP oil spill, which oozed up from the depths and spread, totally out of control, like some kind of hideous uncontrollable metaphor. (Or, Jersey Shore.) The scariest thing about the spill was, nobody in charge seemed to know what to do about it. Time and again, top political leaders personally flew down to the Gulf of Mexico to look at the situation first-hand and hold press availabilities. And yet somehow, despite these efforts, the oil continued to leak. This forced us to face the disturbing truth that even top policy thinkers with postgraduate degrees from Harvard University — Harvard University! — could not stop it.

    The leak was eventually plugged by non-policy people using machinery of some kind. But by then our faith in our leaders had been shaken, especially since they also seemed to have no idea what to do about this pesky recession. Congress tried every remedy it knows, ranging all the way from borrowing money from China and spending it on government programs, to borrowing MORE money from China and spending it on government programs. But in the end, all of this stimulus created few actual jobs, and most of those were in the field of tar-ball collecting.

    Things were even worse abroad. North Korea continued to show why it is known as “the international equivalent of Charlie Sheen.” The entire nation of Greece went into foreclosure and had to move out; it is now living with relatives in Bulgaria. Iran continued to develop nuclear weapons, all the while insisting that they would be used only for peaceful scientific research, such as — to quote President Mahmoud Ahmadinejad — “seeing what happens when you drop one on Israel.” Closer to home, the already strained relationship between the United States and Mexico reached a new low following the theft, by a Juarez-based drug cartel, of the Grand Canyon.

    This is not to say that 2010 was all bad. There were bright spots. Three, to be exact:

    1. The Yankees did not even get into the World Series.

    2. There were several days during which Lindsay Lohan was neither going into, nor getting out of, rehab.

    3. Apple released the hugely anticipated iPad, giving iPhone people, at long last, something to fondle with their other hand.

    Other than that, 2010 was a disaster. To make absolutely sure that we do not repeat it, let’s remind ourselves just how bad it was. Let’s put this year into a full-body scanner and check out its junk, starting with… (more…)



    Wednesday, December 22nd, 2010



    America’s Ruling Class — And the Perils of Revolution

    By from the July 2010 – August 2010 issue

    As over-leveraged investment houses began to fail in September 2008, the leaders of the Republican and Democratic parties, of major corporations, and opinion leaders stretching from the National Review magazine (and the Wall Street Journal) on the right to the Nation magazine on the left, agreed that spending some $700 billion to buy the investors’ “toxic assets” was the only alternative to the U.S. economy’s “systemic collapse.” In this, President George W. Bush and his would-be Republican successor John McCain agreed with the Democratic candidate, Barack Obama. Many, if not most, people around them also agreed upon the eventual commitment of some 10 trillion nonexistent dollars in ways unprecedented in America. They explained neither the difference between the assets’ nominal and real values, nor precisely why letting the market find the latter would collapse America. The public objected immediately, by margins of three or four to one.

    When this majority discovered that virtually no one in a position of power in either party or with a national voice would take their objections seriously, that decisions about their money were being made in bipartisan backroom deals with interested parties, and that the laws on these matters were being voted by people who had not read them, the term “political class” came into use. Then, after those in power changed their plans from buying toxic assets to buying up equity in banks and major industries but refused to explain why, when they reasserted their right to decide ad hoc on these and so many other matters, supposing them to be beyond the general public’s understanding, the American people started referring to those in and around government as the “ruling class.” And in fact Republican and Democratic office holders and their retinues show a similar presumption to dominate and fewer differences in tastes, habits, opinions, and sources of income among one another than between both and the rest of the country. They think, look, and act as a class.

    Although after the election of 2008 most Republican office holders argued against the Troubled Asset Relief Program, against the subsequent bailouts of the auto industry, against the several “stimulus” bills and further summary expansions of government power to benefit clients of government at the expense of ordinary citizens, the American people had every reason to believe that many Republican politicians were doing so simply by the logic of partisan opposition. After all, Republicans had been happy enough to approve of similar things under Republican administrations. Differences between Bushes, Clintons, and Obamas are of degree, not kind. Moreover, 2009-10 establishment Republicans sought only to modify the government’s agenda while showing eagerness to join the Democrats in new grand schemes, if only they were allowed to. Sen. Orrin Hatch continued dreaming of being Ted Kennedy, while Lindsey Graham set aside what is true or false about “global warming” for the sake of getting on the right side of history. No prominent Republican challenged the ruling class’s continued claim of superior insight, nor its denigration of the American people as irritable children who must learn their place. The Republican Party did not disparage the ruling class, because most of its officials are or would like to be part of it. (more…)



    Thursday, December 16th, 2010



    December 15, 2010


    The efforts of Julian Assange by way of Wikileaks are not those of a hero in any way, shape, or form.  Governments need to have secrets, companies need to have secrets, individual human beings need to have secrets.  The belief that there should be no secrets in an open society is naive and dangerous.

    There was a time when Americans were proud of being strong, when we knew what it took to remain strong, when we knew the thin veil of civilization needed to be protected lest we all fall back to a standard of living from another time.  There was a time when people like Julian Assange would have somehow been quietly taken care of in order to assure America’s national security.   (more…)



    Tuesday, December 14th, 2010

    Romney: Tax Cut Deal No Jobs Fix
    Tuesday, December 14, 2010

    The temporary extension of the Bush tax cuts that President Barack Obama and Republican members of Congress agreed to will not translate into large job growth or investment, and Congress should come up with a better deal, says former Massachusetts Gov. Mitt Romney. Uncertainty “is not a friend of investment, growth and job creation,” Romney contends in an opinion column in USA Today.

    Romney, who sought the presidency in 2008, wrote that “with only a two-year extension, investors know that before their returns are realized, tax rates may be jacked up to the levels favored by President Obama. So while the tax deal will succeed in temporarily putting more money in the hands of consumers, it will fail to deliver its full potential for creating lasting growth.”

    Romney also argued that it is time to come up with a different model of unemployment insurance such as “establishing individual unemployment savings accounts over which employees would exercise direct control when they lose their jobs, or putting in place financial incentives for employers to hire and train the long-term unemployed.” (more…)



    Monday, December 13th, 2010
    About Senator Burr | Constituent Services | Contact Me | Share with a Friend
    Before getting into what we worked on in Washington this week, I would like to express my deepest condolences to the family of Elizabeth Edwards.  She was a passionate advocate for issues she believed in and a caring and loving mother.  Her legacy should serve as an inspiration to all of us.  Although her life was not without tragedy and adversity, through it all she fought for her family and faced every challenge with courage, poise, and grace.  Brooke’s and my thoughts and prayers are with her entire family.

    Many of you have called or written my office to express your opinion on the DREAM Act.  This is legislation that would provide a path to citizenship for a large number of illegal immigrants, and it was defeated in the Senate this week.  The DREAM Act would reward those who have broken our immigration laws with citizenship and tuition benefits.  This legislation is fraught with enforcement problems and, counter to what many people think, it is not limited to children. I do not believe it is appropriate to reward those who are in this country illegally at the expense of those who have followed the rules.

    Last night, we received more information about the tax extension proposal put forth by President Obama.  As I have said previously, I support a permanent extension of the current tax rates for everyone.  A tax increase is the last thing American families, and our economy, need.  I am currently reviewing the details of this proposal, and I will keep you informed about what it means for you and your family in the days to come. (more…)

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