ECONOMIC MUSINGS 11-11-12

OBAMA’S TAX INCREASES

BY DOUG MCINTOSH 11-11-2012

            I was asked recently by a reader my opinion on what the US economy would do now that our Marxist thug Obama is still in command. Socrates said to “define your terms” in any discussion. Economics is the production, distribution, and consumption of goods and services. The kleptocracy, called the USA, will slide further into open incorporated dictatorship under Obama. One of the thing’s Doomer Doug finds so interesting about King Obama the First is his mixture of Marxist social ideology with the shared fascism of the kleptocrats running the USA these days. At any rate, the average US worker, living paycheck to paycheck, is in for a rude surprise starting in January of 2013.

The first will be the restoration of the Social Security payroll tax to its usual levels. Obama decided to cut it by 2.5% for both workers and employers as part of his stimulus program.  My rate as self-employed will go from 13.3% to 15.65% or something. All employees in the USA will have a 2.5% reduction in take home pay solely from this. All employers will have an increase in costs in the same amount as their employees.  Check one reduces take-home pay by 2.5% for each worker.

Doomer Doug has been bemused by the Democrat rhetoric on the “Bush tax cut for the wealthy.” The reason for that is one of the major impacts of those cuts was to reduce the federal income tax rate on income earned between $10,000 and $25,000. One-half of all American workers make less than $18,000 a year. One-quarter of them make less than $36,000 a year. The next level is $72,000, and that is followed by $120,000. The fact that the vast majority of American workers make less than $3000 a month, or $36,000 a year, is lost on the Democratic Party.  What will happen when Obama fails to renew these tax rates is simple: it will mean a massive tax increase at the lowest-income levels of American workers. Obama in his zeal is going to crush the laboring poor. Obama’s Marxist goal is to crush the working poor, as well as the middle class, by shifting benefits to people dependent on the government for benefits. Obama is creating his own version of the ancient Roman mob, in my humble opinion.

The current federal income tax rate on income between $10,000 and $25,000 is 10%. Under Obama, that rate will climb to 15%, and that my blog reader is a 50% increase.  The $1500 tax payment will now have an additional $750 tacked on by the name of Obama’s Marxist ideology.  The total will be $2250 and not the Bush tax rate of 10% and $1500. Check for an additional 5% reduction in take-home pay for the average American worker in 2013. The total is now 7.5%

Of course, you have to have a job in order to have any take-home pay to tax with either Social Security or the IRS.  Well, gang, one of the immediate impacts of Obama’s Marxist takeover of the American health care system relates to that exact point.  The entire class of business people, who are not in fact part of the corporate fascist network, called small business has made it very clear what it thinks of Obama care. They have done so by cutting some/many of their workers to part time status of 30 hours a week. The reason they have done that is to opt out of the system by not having full time workers subject to Obama care. Obama care is going to cause a mass shifting of American workers into the part-time worker category.  Few business people will accept the cost of paying for a full-time worker and his health costs under Obama care. Nor will they pay the $2000 fine for not paying for full-time worker health care. Instead, they will leave the system completely and cut worker hours.

One of the interesting results of that very could well be Obama becomes even more punitive and vicious in his Marxist hysteria at people daring to opt out on HIM. We shall see.

All American workers will see a decline in take home paycheck pay of 7.5% from the increase in Social Security and Federal Income tax rates. They will also see their hours cut 25% by employers opting out of Obama’s care.  American workers have already had their hours cut, and millions more will follow them after January 1st 2013, in my humble opinion. If you do the math, this is what you get. 25% added to 7.5% is 32.5%, and that is the potential reduction in paychecks over a one-year period. Granted, things could change, or the uproar could get so bad things could change. Doomer Doug sees no indication the US Senate, the US House, or Obama and his Obamabots are going to renew the Bush tax cuts. The Social Security payroll tax restoration is also a done deal. And finally, now that gutless Boney, the US House Republican leader, has caved on Obama care, Obama care will unleash its chaos.

Obviously, if the amounts I listed above come to pass, you can kiss the US economy good-bye for the foreseeable future. There are certainly other issues related to this, the federal deficit among other things, but that will require a separate essay I think.

In summary, the total increased tax burden in 2013 for the average American worker will increase by 7.5%. In addition, there will be massive numbers of workers forced into part time status courtesy of our Marxist thug Obama and his state medical system.  And finally, there will no doubt be a large number of states, city, and county tax increases involved too. In my personal case, Doomer Doug is looking at a $35 a year poll/art tax, as well as increases in phone, electric, and Internet excise taxes.  Basic items, like food, power, energy, and rent are also going up. Food hasn’t so much gone up in price, as it has gone down in size. The price stays the same, but the size shrinks.  This is the true nature of food inflation in the modern USA.

Obama care is going to be the single worst case of economic harm in the history of the USA. Never have so many, been impacted so badly; for so little gain. One can, as I do, make the case for intelligent health care reform. However, Obama care is not that argument. It is unfortunate the Marxist thug is going to inflict so much pain, and on so many people to prove that point.

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