Commonsense Economics

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It’s too easy to label President Obama’s State of the Union as more tax-the-rich and redistribution. We know that. Rather than name-calling, Republicans must draw a clear line in the sand between their worldview and Obama’s. I’d call that line commonsense economics.

First, you can’t create a new business or sustain an existing one without the seed corn and nourishment of capital investment.

Second, only businesses create jobs. You can’t have a job without a business.

Third, jobs create all incomes, including middle-class incomes.

Fourth, incomes create family and consumer spending.

OK? This is not complicated. It’s common economic sense.

University of Chicago economist Casey Mulligan states this in a simpler way: Growth starts with investment and ends with consumer spending.

Regrettably, Obama doesn’t get this. That’s why he’s proposing the third capital-gains tax hike of his tenure. He started at 15 percent, went to 20, with Obamacare took it to 23.8, and now wants 28 percent. This damages business, jobs, and middle-class incomes.

Ironically, history shows that lower capital-gains tax rates produce higher revenues. Think Bill Clinton and George W. Bush. But a higher capital-gains tax produces lower revenues. Think late-Reagan, Papa Bush and now Obama.

Obama also proposes to raise the tax burden on capital by increasing inheritance and estate taxes. And he’s making another attempt to tax banks — only this time he is adding in asset managers and insurance companies. Ironically, a huge part of Obama’s base — police officers, firefighters, teachers — might suffer a serious depreciation of pension-fund stockholdings.

So, taxing capital will hurt the very middle-class workers and incomes Obama claims he wants to help. His so-called middle-class economics doesn’t work.

A related point: Obama’s SOTU made no mention of cutting corporate tax rates. Instead the president trashed the top 1 percent and slammed companies for keeping profits abroad and using unfair loopholes and deductions.

He’s right about loopholes and deductions. Let’s close them. But while we’re at it, let’s slash the corporate tax rate and make America more competitive worldwide.

Obama kinda forgot the lower-tax-rate part, didn’t he?

Also, nearly all studies show that middle-income wage earners are the biggest beneficiaries of corporate tax cuts.

And regarding those evil 1 percenters, according to the Tax Policy Center, the top 1 percent of Americans paid 33.4 percent of their expanded cash income in federal taxes in 2014. Meanwhile, Americans in the middle 20 percent paid only 13.7 percent of their income in federal taxes, while the poorest paid 3.1 percent.

You’d think a good class warrior such as Obama would like these numbers. Apparently not.

Why? He wants more money for government spending. A partial list includes more spending on childcare, sick leave, equal pay, lower mortgage premiums, a higher minimum wage, student-debt forgiveness, tax credits, and free community college. Some say this could wind up costing $500 billion.

So there’s a lesson here for congressional Republicans and some of my fellow conservatives: Do not get sucked into this class-war politics. You will never outbid the Democrats on middle-class benefits. And take a cue from Ronald Reagan, who rejected class politics and argued that his policies would increase prosperity for all Americans.

For instance, Obama’s child tax credits would be available for couples up to $210,000, tripling the max tax credit for childcare by up to $3,000. And that’s very close to what some of my conservative friends want. But there’s a better way.

Get rid of the 10 percent bracket and collapse the 25 and 28 percent brackets down to 15 percent. So if you’re making $100,000 a year and paying $25,000 at the 25 percent bracket, your tax cost drops to $15,000 at the 15 percent bracket. That’s a $10,000 savings. If you have two kids, with a $3,500 tax credit per kid, that’s only a $7,000 savings.

From the lower marginal tax rates, the middle class gets a much bigger tax savings. And, with marginal rates coming down, the incentive effect kicks in as people keep more of what they earn. And all middle-class folks are included — married with kids, single women without kids, millennials without kids, etc. And there’s still a big savings for the kids we love and cherish. But it’s done without class divisions or the targeted tax credits that Democrats love. (My only exception would be an expanded earned-income tax credit, which would have a longer phase-out period so as not to penalize folks moving from welfare to work.)

Former CEA chair Glenn Hubbard argues that “free community college, an enhanced tax credit for child care and higher taxes on high-income earners and large financial institutions” will not generate “growth, work and opportunity.”

Good advice, Republicans.

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The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom

WATCH: Here’s The ‘Spirited’ Move Russia’s Putin Just Made To Try To Prevent Riots In The Streets

Putin

Russia is facing its worst economic crisis since 1998, with its economy now expected to slide into recession in 2015. And the emergency action just taken by Russian president Vladimir Putin shows he may be acknowledging the growing depth of the peoples’ despair.

With an economy threatened by international sanctions and falling oil prices, with the ruble crashing to dangerous lows, The Independent reports on Putin’s move to calm the deepening unrest in his troubled country — a proposal to freeze the price of Russians’ favorite intoxicant:

He stayed strong as the price of oil cratered, but Russian president Vladimir Putin has finally been forced to intervene on an even more critical commodity: vodka.

…Putin’s announcement, that high vodka prices encourage the production of potentially harmful bootleg spirits and should be capped by the government, is possibly the first sign that economic pressures are getting to him.

By clicking on the video above, you can watch a Euronews report on the move that could well have Russians toasting their president.

 

H/T breitbart.com

This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom

WATCH: This Brilliant Video Perfectly Explains What Obama’s Presidency Has Done To America

Obama Economy Screen Shot

America has certainly changed since President Barack Obama entered the Oval Office.

That change he promised us? He certainly pulled through there.

But was it the change we were looking for?

You decide.

Do you like the direction our country is moving?

This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom

The Economy Is Hurting America, But There Is A Way To Improve Your Financial Situation

Statue of Liberty 2 SC

I have come to the conclusion that many people on the Left are just not good people.  What other conclusion can you come to after watching the blatant class warfare and race baiting that continues to come out of this administration and from their cronies on the Left.  There was a similar point in Russia decades ago as the Bolsheviks attempted to take over the country with lies, subterfuge, and an appeal to the worst human traits of envy and lust of another’s lifestyle.  We are seeing the same thing today;  Lenin would be proud of Obama, Pelosi, Reid, and the others.  They are simply just not good people. They are bad for America, and their ideology has to be defeated and stopped.

The Left refuses to admit that their socialist economic policies have retarded economic growth in America.  Instead, they point to the capitalist boogie-man and those evil corporations as causing the rise in unemployment and reduction in per-capita income we have seen across the United States.  Of course, if you look at states like Texas and North Dakota, where free-markets still reign, economic growth is booming.  California is energy rich like these states, but the Left prevents industry from harvesting its reserves, therefore preventing job creation.  Other blue states like New York and Illinois suffer devastating budget deficits that prevent basic services from being delivered, yet the Left continues to blame the Republicans and the minority party instead of looking themselves in the mirror.  All the while, the unions and other special interests rake in billions from state coffers and bad teachers and other bureaucrats can’t be fired.

Here’s a newsflash for the Left: If you are an American in a low-paying, dead-end job, or have lost your job altogether, you can always start a business.  Even a micro-business can add income to your family’s budget, provide self-respect, and help the economy.  Most jobs are created by small businesses, not major corporations.  These small businesses are the entities that have been hurt the most by Obama’s regulatory overreach, wealth redistribution, and overall bad economic policies.  If you start a small business and work hard over time, eventually it will turn into a larger business, hire people, and create wealth.  The Left refuses to admit this.  They only want other people’s money and to foster societal unrest.

The race-baiting coming out of the Left these days is just infuriating.  These people have no desire for a harmonious, diverse, America.  They only want to use diversity as a tool to take from others what they want and refuse to work for.  The use of racial strife as a way to gain political power is just simply evil.  There is no other way to describe it.  It is hurting others for your own political gain.  The Left is desperate for race to remain an issue after the election of the first black president.  White America has moved on and for the most part is no longer racist.  Black race hustlers attempt to roll back the clock and create racism among minorities.  This is all just bad for the country.  Freedom loving Americans and good-hearted conservatives have to fight this internal enemy head on for the benefit of our children’s future.

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom

Obama’s America: Number Of Young Adults Living With Parents Just Passed A Shocking Milestone

Photo Credit: Ojedamd (Creative Commons)

The Obama administration has been intensely criticized by many who contend its leftward trajectory has stunted economic growth and kept unemployment levels unreasonably high.

Recent studies show the startling effect these policies have had on the traditional American family structure. According to a Los Angeles Times report, the scarcity of good jobs has been a major factor in a record high number of adults forced to live with parents to make ends meet.

Nearly one in four Americans between the ages of 25 and 34 now live with parents or grandparents, the study found.

That number has spiked in just the first six years of Obama’s presidency. In 2007, just 18.7 percent of those in the same age group shared a home with older relatives.

More than twice as many Americans live in so-called multigenerational households now compared to 1980. As of 2012, a staggering 57 million citizens found such an arrangement optimal.

Perhaps the most astounding discovery revealed in the study was a comparison between young adults living with parents and elderly Americans living with their children.

In the U.S., large numbers of middle-aged adults have typically cared for their aging parents in a common home. While the rate of such arrangements has increased in recent years, less than 23 percent of those over 85 years of age currently reside with their children – a lower percentage than young adults living with parents.

As expected, the number of multigenerational households saw an increase correspondent with the 2008 recession.

Despite the fact that the Obama administration asserts the American economy is in recovery, however, this way of living has only continued to rise.

Photo Credit: Ojedamd (Creative Commons)

This post originally appeared on Western Journalism – Informing And Equipping Americans Who Love Freedom