Diary

Obama's Tax Policies/Fair Share

I was sent this information by my brother… Just thought that I would post for all to see:

OBAMA’S RIDICULOUS TAX POLICYThe parsons of the press corps are furious with Charlie Gibson and George Stephanopoulos of ABC News, which means the pair must have done a pretty good job moderating Wednesday’s Democratic debate in Philadelphia. Barack Obama had an off-night, so his media choir wants to shoot the questioners.

We thought the debate was on e of the best yet, precisely because it probed the evasive rhetoric we’ve heard from both Democratic candidates throughout the campaign. Nowhere was this more apparent than during the exchanges between Mr. Gibson and Mr. Obama over taxes.

Time and again, the rookie Senator has said he would not raise taxes on middle-class earners, whom he describes as people with annual income lower than between $200,000 and $250,000. On Wednesday night, he repeated the vow. “I not only have pledged not to raise their taxes,” said the Senator, “I’ve been the first candidate in this race to specifically say I would cut their taxes.”

But Mr. Obama has also said he’s open to raising – indeed, nearly doubling to 28% – the current top capital gains tax rate of 15%, which would in20fact be a tax hike on some 100 million Americans who own stock, including millions of people who fit Mr. Obama’s definition of middle class.Mr. Gibson dared to point out this inconsistency, which regularly goes unmentioned in Mr. Obama’s fawning press coverage. But Mr. Gibson also probed a little deeper, asking the candidate why he wants to increase the capital gains tax when history shows that a higher rate brings in less revenue.

“Bill Clinton in 1997 signed legislation that dropped the capital gains tax to 20%,” said Mr. Gibson. “And George Bush has taken it down to 15%. And in each instance, when the rate dropped, revenues from the tax increased. The government took in more money. And in the 1980s, when the tax was increased to 28%, the revenues went down. So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?”

Mr. Obama answered by citing rich hedge fund managers. Raising the capital gains tax is necessary, he said, “to make sure . . . that our tax system is fair and that we are able to finance health care for Americans who currently don’t have it and that we’re able to invest in our infrastructure and invest in our schools. And you can’t do that for free.”

But Mr. Gibson had noted that higher rates yield less revenue. So the news anchor tried again: “But history shows that when you drop the capital gains tax, the revenues go up?” Mr. Obama responded that this “might happen or it might not. It depends on what’s happening on Wall Street and how business is going.” And then he went on a riff about John McCain and the housing market.

This is instructive. The facts about capital gains rates and revenues are well known to our readers, but we’ll repeat them as a public service to the Obama campaign. As the nearby chart shows, when the tax rate has risen over the past half century, capital gains realizations have fallen and along with them tax revenue. The most recent such episode was in the early 1990s, when Mr. Obama was old enough to be paying attention. That’s one reason Jack Kennedy proposed cutting the capital gains rate. And it’s one reason Bill Clinton went along with a rate cut to 20% from 28% in 1997.

Either the young Illinois Senator is ignorant of this revenue data, or he doesn’t really care because he’s a true income redistributionist who prefers high tax rates as a matter of ideological dogma regardless of the revenue consequences. Neither one is a recommendation for President.

-The Wall Street Journal

OBAMA’S FAIR SHAREDemocratic presidential candidate Barack Obama would raise taxes on the rich, but as an investor, he seems eager to cut his own…He has invested at least $1 million in a fund that yields tax-free income.

< /span>The Illinois senator’s latest campaign-finance disclosure shows that his investments have nearly tripled in the past two years to as much as $7.4 million, and his income in 2007 surged past $4 million, not counting his government salary.Obama reported accounts with Morgan Chase Private Client Asset Management, an elite firm that deals only with the rich, as well as a host of retirement accounts,=2 0some in the name of his wife, Michelle.By far the largest account, valued between $1 million and $5 million, was in the Northern Municipal Money Market Fund. It generated tax-free interest in 2007 of between $15,001 and $50,000. Northern Trust “has built a well-deserved reputation around being the banker for the überrich,” says Andrew Richards, a Morningstar equity analyst. In a report on the Chi cago company’s stock, he writes, “The firm estimates it serves roughly 20% of the richest families profiled annually in the Forbes 400.”Obama has proposed a host of increases that would raise the federal income-tax rate on top earners…to 52% from 35%, according to an analysis by Investor’s Business Daily. That calculation includes applying the 12.4%20payroll tax that funds Social Security to some income above the current $102,000 cap, and letting some of President Bush’s tax cuts expire.

Interest on municipal bonds, however, is exempt from tax, which is why Obama’s Northern Trust fund generates tax-free income.

For now, the raise-taxes-and-avoid-them platform is occupied solely by Barack Obama.

-MSN Money