First the Obama Misery Tour, then on to Martha’s Vineyard with the other Millionaires and Billionaires

Posted by PITHOCRATES - August 15th, 2011

Raising Taxes on the ‘Rich’ to Close the Deficit will put the Country into a Depression

Roll up, roll up for the misery tour.  Roll up, roll up for the misery tour.  The Obama Misery Tour is waiting to take you away.  Waiting to take you away (see Obama kicks off Midwest bus tour with harsh words on the economy by Zachary A. Goldfarb posted 8/15/2011 on The Washington Post).

Obama, who kicked off a three-day Midwest bus tour Monday focused on the economy, cited comments made by Republican presidential hopefuls at a GOP debate last week.

“I know it’s not election season yet, but I just have to mention the debate,” where Republicans said they would not increase taxes under virtually any circumstance, Obama said at a town hall. “Think about that. That’s just not common sense.”

Neither did raising the deficit from $455 billion to $1.65 trillion, Mr. President.  In fact this spending was downright irresponsible.  Your administration spent an additional $1.195 trillion we didn’t have.  And you’re planning to spend more.  We have a deficit problem because we have a spending problem.  Not because people aren’t paying enough taxes.

“You’ve got to send a message to Washington that it’s time for the games to stop. It’s time to put country first,” Obama said, his voice rising. “Some folks in Congress … would rather see their opponents lose, than America win.”

Mr. President, you increased the deficit by 263%.  That is not good for the country.  In fact, one could say that you are the ‘some folks’ you refer to who would rather see their opponents lose than America win.

He called on Congress to pass measures to hire construction workers, a trio of trade bills, an overhaul of patent laws and new tax credits to spur new jobs for veterans.

You had supermajorities during your first two years in office.  You could have passed any legislation you wanted to spur new jobs.  Instead, you made your priority the passing of Obamacare.  Something that did not spur any jobs.  And only will increase the deficit. 

And hire construction workers?  Wasn’t your Keynesian stimulus bill supposed to do that?  Create some $800 billion in shovel-ready projects?  Of course that’s hard to do when 88% of that bill was pork and earmarks.  Sort of a Democrat wish list to satisfy some 40 years of wants and desires. 

Speaking about the national debt, Obama called for an overhaul of the tax code that would force the wealthy to pay more taxes and an overhaul of entitlement programs…

“I’d like to see the ultra-rich pay their fair share,” said…a nurse from Rochester. “He’s got to be a politician, but I’d like to see a bit more push.”

“I think he’s doing a good job. He inherited a very big deficit,” said…a financial planner from Rochester. “He and Michelle are the first residents of the White House to be familiar with both organic food and leftovers.”

The wealthy just aren’t wealthy enough to pay down the deficit.  If you crunch the numbers, and define anyone who earns $159,619 or more as wealthy, you’ll have to raise the federal income tax to an effective rate of 87.6% (see You can’t Reduce the Debt $4 Trillion by Raising Taxes, at least not Mathematically).  That means the government would have to take 87.6% of everything they earn.  That includes the billionaires and the millionaires.  And everyone earning $159,619 or more. 

Is this possible?  Well, if you earn $159,619 annually, that’s $13,301.58 gross pay each month.  After your federal income taxes are withheld, that leaves a whopping $1,649.40 to pay your state taxes, your mortgage, your car payment, your groceries, health insurance, car insurance, gasoline for your car, etc.  Of course, they won’t be able to have these things at this high tax rate.  In fact, they won’t have any money left to spend.  Consumer spending over all would nosedive us into a full blown depression.  Making things even worse than they are now. 

So what is Obama going to do next?

Obama is scheduled to go on a 10-day family vacation to Martha’s Vineyard on Thursday after completing the economic tour.

While many Americans can no longer afford to take the family on a vacation, he will be spending 10 days in the very swanky Martha’s Vineyards.  Where billionaires and millionaires like to vacation.  And get away from the rabble.  Us.

Politicians are Whores who sell themselves to the Highest Bidder 

The johns threaten to withhold their money from the prostitutes in Washington (see Starbucks CEO urges halt to U.S. political donations by Lisa Baertlein posted 8/15/2011 on Reuters).

In his letter on Monday, Schultz [Starbucks Corp. CEO] invited executives to join him in a “pledge to withhold any further campaign contributions to the President and all members of Congress until a fair, bipartisan deal is reached that sets our nation on stronger long-term fiscal footing.”

Men are interested in one thing.  According to all the stereotypes.  And when women want something, they can simply withhold this one thing.  Again, according to the stereotypes.  Eventually the man caves because he can’t live without that one thing.  What a great analogy.  Because all politicians are whores who sell themselves to the highest bidder.  And those buying political favors can simply withhold their money to get what they want.  Which is how government works.  Sadly.

Schultz also urged fellow CEOs to invest in projects or new products that will perk up the economy at a time when fear and uncertainty have made businesses unwilling to invest, consumers unwilling to spend and banks unwilling to lend.

Expand supply in the face of a shrinking demand?  Not a good idea.  Austrian economists call this malinvestment.  This kind of thinking didn’t help ward off the Great Depression.  And it won’t work here.  You create real demand by cutting taxes.  Giving people more money to spend now.  Next week.  Next month.  And next year.  This creates confidence.  Not a one-time stimulus that provides consumers with money to spend one time.  A tax cut will increase demand.  And once consumers are demanding more business will start hiring more. 

I guess a guy who has convinced people to buy over-priced coffee just assumes businesses can make consumers do anything.  But would he open a new Starbucks next to an existing one?  No.  Why?  Because what would probably happen is that each store will have half the business of the first store.  While doubling the overall costs for that business.  So that would be a malinvestment.  So he wouldn’t do it.  Yet he is asking his fellow CEOs to do just that.

Obamanomics has Failed so let’s Return to the Successful Policies of Reaganomics

It’s been about three years.  Record government spending hasn’t done anything but increased the deficit.  And get U.S. credit downgraded.  You can make all the excuses you want.  But eventually you have to answer for your policies.  Obama’s policies have failed.  And left us worse off than we were.

The Keynesian way has once again failed.  Perhaps we should give the Austrian way another try.  Because when Reagan did, those policies worked. 

We tried Obamanomics.  It failed.  So let’s go back to Reaganomics.  At least it has a track record of success.

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