tax

'Balanced' tax deal: $41 in new spending for every $1 in cuts

Thursday, January 03, 2013 by: J. D. Heyes
Tags: tax deal, fiscal cliff, spending cuts

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(NaturalNews) Many Americans have long known that accounting practices in the nation's capital are, to put it mildly, "creative." Pay increases tend to come automatically, money can be printed and valued out of thin air, and spending "cuts" generally don't mean actual cuts to budgetary line items - only reductions in the amount of spending increases.

It is in this context in which voters should actually view the recently completed "balanced tax-and-spending deal" reached by lawmakers and President Obama this week that ostensibly avoided the impending "fiscal cliff," because there was nothing balanced about it.

Why? Because there literally were no spending cuts at all - again, only reductions to the growth of current line items - and most of the legislation involves increasing taxes on a whopping 77 percent of Americans.

Wait - didn't Obama, Vice President Joe Biden, Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi all claim that Congress and the administration would not be raising taxes on anyone but the most well-to-do wage earners (the ol' class warfare card)?

Yes, they did. But a closer examination reveals that is precisely what happened. And keep in mind these tax hikes are in addition to the $1 trillion worth of tax hikes contained in Obamacare, which hit Jan. 1.

'We simply can't cut our way to prosperity'

"President Obama this morning pocketed the Republican concessions on tax hikes included in the Fiscal Cliff deal and promised that it was only the beginning of new taxation to be assessed on the American people," wrote veteran White House correspondent Keith Koffler on his website, WhiteHouseDossier.com.

Appearing in the White House briefing room the evening of Jan. 1 to praise the last-minute deal, the president was clear with Republicans that he will continue to seek what he called a "balanced" approach to reducing the deficit - which is this president's code for "balancing" spending cuts with raising taxes, the latter of which is something Obama's wanted to do since taking office.

That said, the spending spree will continue, and will actually rise in the coming months and years, per the president:

We can't simply cut our way to prosperity. Cutting spending has to go hand-in-hand with further reforms to our tax code so that the wealthiest corporations and individuals can't take advantage of loopholes and deductions that aren't available to most Americans. And we can't keep cutting things like basic research and new technology and still expect to succeed in a 21st century economy. So we're going to have to continue to move forward in deficit reduction, but we have to do it in a balanced way, making sure that we are growing even as we get a handle on our spending. ... Today's agreement enshrines, I think, a principle into law that will remain in place as long as I am President: The deficit needs to be reduced in a way that's balanced. Everyone pays their fair share. Everyone does their part. That's how our economy works best. That's how we grow.

But there's nothing about this deal that is balanced (let alone "fair," considering the very tax brackets Obama has repeatedly targeted are the same ones that already pay, by far, the lion's share of federal income taxes.

According to the non-partisan Congressional Budget Office, the legislation that http://washington.cbslocal.com, at a cost of $7 million to taxpayers, raises $43 in new taxes for every $1 in so-called spending cuts.

That's "balanced?"

No real spending cuts in sight

"While the Fiscal Cliff's automatic deficit reduction included both tax increases and spending cuts, the deal passed by Congress Tuesday night relied almost exclusively on tax increases to pare down the deficit," Koffler noted. "The massive Fiscal Cliff spending cuts that had been scheduled to take effect at the beginning of the year are still on tap, but have been delayed for two months."

Some Republicans also voted for the tax increases, marking the first time members of the GOP have voted for tax hikes in two decades.

Worse, based on the president's "balanced approach" language - in which he has already claimed that the nation somehow can't cut its way back to fiscal health, they are deluding themselves if they really think Obama and Democrats are ready to seriously trim line items.

It's endless growth of government that is on tap in the nation's capital. There will be no serious efforts made to cut spending.

Sources:

http://www.whitehousedossier.com/2013/01/02/obama-vows-tax-increases/

http://www.ntu.org/tax-basics/who-pays-income-taxes.html

http://www.breitbart.com

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