Obama's record budget: Tax the rich, help middle class

[webfact]

Obama's record budget: Tax the rich, help middle class
By ANDREW TAYLOR

WASHINGTON (AP) — Promising to help America's middle class, President Barack Obama on Monday sent Congress a record $4 trillion budget that would hammer corporate profits overseas and raise taxes on the wealthy while boosting tax credits for families and the working poor.

Obama's budget also would steer hundreds of billions of dollars to the nation's crumbling infrastructure of roads and bridges, help provide two years of free community college and reverse the across-the-board, automatic budget cuts that have slammed the Pentagon and nearly every government department.

In the face of certain opposition from Republicans, an optimistic Obama hailed a "breakthrough year for America" of new jobs, lower unemployment and shrinking deficits after the great recession of 2008, and he called for moving past years of "mindless austerity." The blueprint for the 2016 budget year that begins Oct. 1 represents a 6.4 percent increase over estimated spending this year, projecting that the deficit will decline to $474 billion.

However, Obama's plan ignores the new balance of power in Washington, with Republicans running both the House and Senate. The GOP found plenty to criticize in his proposed tax hikes that would total about $1.5 trillion.

Republicans cited the nation's $18 trillion debt and assailed what they call Obama's tax-and-spend policies for failing to address the spiraling growth of benefit programs such as Social Security and Medicare.

"Today President Obama laid out a plan for more taxes, more spending, and more of the Washington gridlock that has failed middle class families," said House Speaker John Boehner, R-Ohio. "This plan never balances — ever."

Republicans aren't offering specifics yet but will respond this spring with their own plan, a balanced-budget outline promising to get rid of "Obamacare," ease the burdens of the national debt on future generations, curb the explosive growth of expensive benefit programs and reform a loophole-cluttered tax code in hopes of promoting economic growth.

While Obama's plan was rejected out of hand on budget day, proposals to ease automatic cuts and boost transportation funding are likely to return later in the year and require extensive negotiation.

"These proposals are practical, not partisan," Obama said of his overall plans. "They'll help working families feel more secure with paychecks that go further, help American workers upgrade their skills so they can compete for higher-paying jobs, and help create the conditions for our businesses to keep generating good new jobs for our workers to fill."

Some people would pay more. Many wealthy Americans would be able to take tax deductions at the 28 percent rate only even if their incomes were taxed at 39.6 percent, and some would also see an increase in their maximum capital gains rate.

However, a couple earning up to $120,000 a year would qualify for a new "second earner" tax credit of up to $500 as well as a maximum $3,000 per-child tax credit for child care for up to two children, triple the current credit of $1,000.

Obama's initiatives to tax the wealthy and to welcome an influx of immigrants into the United States are going nowhere in the new GOP-run Congress.

But there is a bipartisan desire to ease automatic spending cuts that are the product of Washington's failures to cut deficits beyond an initial round in 2011. Both Republicans and Democrats are howling that such broad cuts savage the Pentagon. Obama said he won't give more money to the Pentagon without receiving domestic funds he wants.

"It would be bad for our security and bad for our growth," Obama said Monday at the Department of Homeland Security.

The centerpiece of the president's tax plan is an increase in the capital gains rate on couples making more than $500,000 per year. The rate would climb from 24.2 percent to the Reagan-era top rate of 28 percent. Obama also wants to require estates to pay capital gains taxes that reflect the increase in value of assets like homes and stocks prior to death instead of after inheritance. And he is trying to impose a 0.07 percent fee on the roughly 100 U.S. financial companies with assets of more than $50 billion, raising $112 billion over 10 years.

All told, Obama proposes higher receipts of about $2 trillion though his budget: about $1.5 trillion from tax increases and almost $500 billion from fresh revenue as immigration reform lifts the economy and provides new workers.

His proposals would boost federal spending by $74 billion — divided between the military and domestic programs — and would result in a spending increase of $362 billion over the remaining six years the spending caps were to have been in place.

The deficit would remain under $500 billion a year through 2018, but would rise to $687 billion by 2025, according to administration projections — though levels of red ink could still be considered manageable when measured against the size of the economy.

But the cost of financing the government's debt would spiral as the debt grows to more than $25 trillion by 2025 and interest rates rise. According to the projections. Interest costs would jump from $229 billion this year to $785 billion in 2025.

A principal theme this year is infrastructure — the budget books' cover photo is the deteriorating Tappan Zee bridge over the Hudson River — and the plan includes a six-year, $478 billion transportation and infrastructure plan. Gasoline tax revenues would cover only half the cost, so Obama proposes a 14 percent tax on overseas corporate profits to bring in $238 billion. The combination would permit about a one-third increase in spending, with transit programs being the biggest winners.

Obama's plan contains a lengthy roster of proposals that have been repeatedly rejected by lawmakers: $600 billion in additional revenue over a decade by limiting tax deductions for upper bracket earners; $95 billion from nearly doubling the cigarette tax to $1.95 a pack, and $35 billion through a minimum 30 percent tax rate on million-dollar incomes.

He wants to increase the security fee paid on air travel from $5.60 to $7.50 per one-way ticket. And there's a new 10-year, $2.5 billion proposal to limit the deductibility of gifts that boosters of college teams give to earn the right to buy basketball and football tickets.

The White House claims $1.8 trillion in deficit savings over 10 years but does so by taking liberties such as ignoring the cost of preventing Medicare cuts to doctors' fees and extending refundable tax credits for the working poor and couples with children that expire in 2017.
___

Associated Press writers Martin Crutsinger and Jim Kuhnhenn contributed to this report.


-- (c) Associated Press 2015-02-03

[Loptr]

Followed closely by this statement from the Obama White House...

Obama says he won’t accept budget that doesn’t raise spending

http://www.washingtontimes.com/news/2015/feb/2/obama-wont-accept-budget-doesnt-raise-spending/

I guess $18 TRILLION USD in debt isn't enough to break the back of the country...

[PoeDogg]

[marquisdesade]

Take from people who work and give to the hood !

[NeverSure]

Followed closely by this statement from the Obama White House...

Obama says he won’t accept budget that doesn’t raise spending

http://www.washingtontimes.com/news/2015/feb/2/obama-wont-accept-budget-doesnt-raise-spending/

I guess $18 TRILLION USD in debt isn't enough to break the back of the country...

When Obama took office just a little more than 6 years ago the US debt, from all time, was just over $10 trillion. Today it is $18 trillion and some wonder why some of us are "up to here" with him?

[maidee]

as long as the rich pay less taxes than anybody else, useless

[pmarlin]

It doesn't matter. congress hasn't passed a real budget in years much less one proposed by the President. Most budget request during the last 40 years are DOA. By the way a republican Congress is not going to raise taxes.

[DeaconJohn]

The country has been going downhill since the '60s when it was hands down the best place in the world to live.

Fiddling the books isn't going to reverse that slide.

[iReason]

The country has been going downhill since the '60s when it was hands down the best place in the world to live.

Fiddling the books isn't going to reverse that slide.

Yes.

Ever since they killed the Kennedys.

JFK wanting to do away with the Fed, going back to the gold standard, disolving the CIA, and stopping a war.

Look how that ended up for him.

Executive Action.

That's when Fascism got it's firm grip.

And all downhill since.

[ALLSEEINGEYE]

The republicans are very happy to tax and spend too. the difference is they want to spend all of the tax money fighting wars that they should keep their nose out of and don't want to spend any money at home for education or infrastructure.

They don't even want to spend any money to support the brave soldiers that fought and got injured for their various wars for money.

The USA needs another Reagan. This way they can still fight all their wars but they can use drug money to fund them.

[SpokaneAl]

as long as the rich pay less taxes than anybody else, useless

Contrary to actual data, I suppose some will continue to flog that old horse.

[mopar71]

"Obama's budget also would steer hundreds of billions of dollars to the nation's crumbling infrastructure of roads and bridges, ..."

Didn't that $750 billion stimulus package back in 2009-2010 do the same? The only infrastructure project I remember hearing about was that bridge in California that the US paid the Chinese to build.

[mopar71]

as long as the rich pay less taxes than anybody else, useless

Contrary to actual data, I suppose some will continue to flog that old horse.

All people have to do is go to irs.gov and look at the data themselves, all in Excel format. However that would require thinking for themselves instead of getting wisdom from a bumper sticker attached stuck on the back of a Prius.

[SpokaneAl]

as long as the rich pay less taxes than anybody else, useless

Contrary to actual data, I suppose some will continue to flog that old horse.

All people have to do is go to irs.gov and look at the data themselves, all in Excel format. However that would require thinking for themselves instead of getting wisdom from a bumper sticker attached stuck on the back of a Prius.

You mean like this . . .

The Top 50 Percent of All Taxpayers Paid 97 Percent of All Income Taxes; the Top 5 Percent Paid 57 Percent of All Income Taxes; and the Top 1 Percent Paid 35 Percent of All Income Taxes in 2011

[Pinot]

You put the word "Obama" in the title of any new post and the tin foil hat, nutters go out of their minds.

If you're an American making less than $250k and voting republican, you're voting against your own self interest. Obama's approval rating is on a dramatic rise. Obamacare has insured 12 million people for less money than originally thought. He's ended two wars, nailed Osama, saved the economy. The stock market is at record levels and the American dollar is stronger than its ever been. This despite every effort by Republicans to sabotage Obama's Presidency at every turn. He's accomplished amazing things when you take that into consideration.

Of all the clowns now running for the Republican nomination (with Scott Walker leading Iowa ) there isn't a creative policy on anything except lowering taxes on the rich. That's it, lower taxes on the rich. Possibly start a war with the terrorist de jour. Maybe build a fence to keep out the terrorist. Whatever weirdness Fox tells you to be afraid of this week.

I know how hard it must be for the lemmings, but turn off Fox News and take a breath of fresh air. Try and get the hate and fear under control. Reading these posts, I'm really worried you guys.

[Jingthing]

America needs more socialism and less tea baggerism.

There, I said it!

Still waiting for decent health care access in the USA ... even Obama's welfare for the medical big money industries scheme is barely a start and still being actively blocked by the right wingers.

[SpokaneAl]

"Obama's budget also would steer hundreds of billions of dollars to the nation's crumbling infrastructure of roads and bridges, ..."

Didn't that $750 billion stimulus package back in 2009-2010 do the same? The only infrastructure project I remember hearing about was that bridge in California that the US paid the Chinese to build.

In remembering the discussion over all the "shovel ready projects" I was wondering the same thing.

[SpokaneAl]

America needs more socialism and less tea baggerism.

There, I said it!

Still waiting for decent health care access in the USA ... even Obama's welfare for the medical big money industries scheme is barely a start and still being actively blocked by the right wingers.

The term tea bagger started out made up of a very reasonable, conservative group. Then the media stepped in with their colorful conclusions and all kinds of wackos followed. Now it is pretty much a knee jerk meaningless definition.

[ALLSEEINGEYE]

Americas spends more on it's military then the next 12 countries in the world COMBINED!!! That is crazy. It only makes sense that if you have a 18 Trillion dollar deficit, that you should cut back on your military spending and use that to pay off the deficit. If they halved their annual defense budget, they would have no deficit in no time flat and they would still spend more than the next 5 or 6 countries in the world combined.

Of course the big corporations that benefit from war mongering would never allow their puppet politicians in congress to write any laws that would make this happen.

[arjunadawn]

"The problem with socialism that eventually you run out of other people's money."

Lady Thatcher

This is more liberal socialist redistribution. The net result is further degradation of the America I once knew.

[CMNightRider]

as long as the rich pay less taxes than anybody else, useless

"The rich pay less taxes than anybody else??" According to the Congressional Budget Office, the 10% of households in America, with the highest incomes pay more than half of federal income taxes. It accounts for over 70% of federal taxes collected.

"Tax the rich??" How on earth did America end up with a socialistic president. Socialism and communism do not work. What we need is limited government, low taxes, and incentives to work hard.

[impulse]

Followed closely by this statement from the Obama White House...

Obama says he won’t accept budget that doesn’t raise spending

http://www.washingtontimes.com/news/2015/feb/2/obama-wont-accept-budget-doesnt-raise-spending/

I guess $18 TRILLION USD in debt isn't enough to break the back of the country...

When Obama took office just a little more than 6 years ago the US debt, from all time, was just over $10 trillion. Today it is $18 trillion and some wonder why some of us are "up to here" with him?

If the USA were run as a business and had to accrue for the spending set in motion by his predecessor, the picture would have been a lot different when he stepped into office.

Who's at fault, the guys who rang up the bills with tragically bad decisions, or the next 10 presidents who will be paying them down (or not)?

On an aside, it's interesting to note that America was at it's peak economic strength and growth when the top tax rate was 90%.

Edited February 3, 2015 by impulse

[Chicog]

What America needs is stimulus spending, a raised minimum wage and serious efforts to stop the wealth shifting from the bottom to the top.

America's economy depends on consumerism, and if you keep taking that money away from the consumers it will keep struggling.

All these so called "wealth creators" and "job creators" are a fiction from the GOP to justify handing over yet more money to them in return for getting their campaigns funded.

Edited February 3, 2015 by Chicog

[zydeco]

What made America successful was cheap land and scarce labor, which enabled the creation of the great American middle class. Immigration, legal and illegal, works directly against that model. Controlled and limited immigration is what is needed. But that horse has already left the barn. Bad times still coming. And it will take courage, will, and determination to put the country back on the right path.

[arjunadawn]

as long as the rich pay less taxes than anybody else, useless

"The rich pay less taxes than anybody else??" According to the Congressional Budget Office, the 10% of households in America, with the highest incomes pay more than half of federal income taxes. It accounts for over 70% of federal taxes collected.

"Tax the rich??" How on earth did America end up with a socialistic president. Socialism and communism do not work. What we need is limited government, low taxes, and incentives to work hard.

Its a race to the bottom where the common pool of humanity aspires to slothfulness, handouts, and non industrious lives. Its equality of outcomes rather than opportunity. The answer to the morass is not further tried and failed socialist policies but a return to the core principles that enable men (and women) to succeed or fail on merit and innovation. It necessarily follows that when you bankrupt a country your primary result is the destruction of the political system. It is to this aim Obama aspires.

The race to debase the US currency is the only possible outcome of such consistently destructive economic policies. One can argue the politics of economics all day, but the fact remains: under the stewardship of this man America has quickly approached the precipice where both our currency and our politics are debased, and worthless. It is only the negation of facts that can have someone not note the danger America is in. It is in this abyss I have my greatest concerns regarding this president.

[Rajhulmaheesh]

Why doesnt Megan Kelly ask the white house what happened to the $800 billion they had for shovel ready jobs.

The electorate spoke loud and clear just Say no to obama on everything. Whats 2 more years? -------

--

[impulse]

...and the Top 1 Percent Paid 35 Percent of All Income Taxes in 2011

I'm just going to focus on that single number.

Because in the next year (or so), the top 1% will come to possess over half of all the world's wealth. Look it up. It's in all the newspapers.

Seems a little unfair that they only pay 35% of all income taxes...

Edited February 3, 2015 by impulse

[Pinot]

as long as the rich pay less taxes than anybody else, useless

"The rich pay less taxes than anybody else??" According to the Congressional Budget Office, the 10% of households in America, with the highest incomes pay more than half of federal income taxes. It accounts for over 70% of federal taxes collected.

"Tax the rich??" How on earth did America end up with a socialistic president. Socialism and communism do not work. What we need is limited government, low taxes, and incentives to work hard.

Its a race to the bottom where the common pool of humanity aspires to slothfulness, handouts, and non industrious lives. Its equality of outcomes rather than opportunity. The answer to the morass is not further tried and failed socialist policies but a return to the core principles that enable men (and women) to succeed or fail on merit and innovation. It necessarily follows that when you bankrupt a country your primary result is the destruction of the political system. It is to this aim Obama aspires.

The race to debase the US currency is the only possible outcome of such consistently destructive economic policies. One can argue the politics of economics all day, but the fact remains: under the stewardship of this man America has quickly approached the precipice where both our currency and our politics are debased, and worthless. It is only the negation of facts that can have someone not note the danger America is in. It is in this abyss I have my greatest concerns regarding this president.

That is the Republican thinking in a nutshell. It's also the reason there will not be another Republican President for a long time. Let's not forget where that thinking got us and where we are today.

[wwest5829]

Take from people who work and give to the hood !

Well, the budget proposal has been made. We all know that Congress will now weigh in to the issue. The question I have is, what counter proposals will Congrss make and what will they do about funding. The majority in Congress seem to agree that, across the board cuts are not workable. Note that a large part of across the board cuts deal with the need for greater military budgets. So, do we increase the taxes on the wealthy, to say the level of the Reagan administration, to pay for this or should we cut Social Security and Medicare payments as some Republicans have proposed? I am sorry if you have reduced the country's needs to simply taxing employees to give to welfare recipients. Its a bit more involved.

[wwest5829]

Why doesnt Megan Kelly ask the white house what happened to the $800 billion they had for shovel ready jobs.

The electorate spoke loud and clear just Say no to obama on everything. Whats 2 more years? -------

Ha! Yes, the national electorate spoke twice as the President pointed out in the State of the Union, he remembered he won both national elections. Yes,

those who voted certainly elected Republicans. Looking a bit closer, what do you know, Democrats garnered more overall votes and the total electorate turn out was the lowest since the 1940's. So, the supposition that the majority of the people supported the Republican Party is not a truthful view.

However, I am more interested in seeing what the new Republican Congressional majority does to govern. What laws will be proposed? What government programs will be funded and at what level?