Thursday, October 16, 2008
At a campaign stop in Holland, Ohio last weekend BO had an interesting encounter with Joe Wurzelbacher, now known simply as "Joe the Plumber". The content of their discussion is worthy of our attention, as it demonstrates the problems with Obama's economic proposals. Joe the Plumber brings a human face to the destruction which would be brought about if BO should be elected President.
Joe pointed out that although he does not fit anyone's definition of "rich", BO's proposed tax hike for people making more than $250k would hit him hard. The reason is that Joe runs a small plumbing business which employs 5 people. It is not large enough to make it worthwhile to incorporate, so the revenue the business generates is taxed as ordinary income for Joe. However, from that money he must pay the salary of his five employees and the expenses of running the plumbing business -- vehicles, insurance, parts, etc. What he actually pays himself, money he can spend for his own housing, food, medcial care, clothing, and other living expenses, is far less than $250k. Obama's plan is to bend Joe the Plumber over a barrel and mercilessly rape him. BO justified his plan to Joe, saying "I don't want to punish your success. I want to make sure that everyone behind you gets the same shot at success. I think that when you spread the wealth around, it's good for everybody." Where I come from, that is called Socialism. Anyone who can explain the distinction is welcome to take a shot at it. The distinction will certainly be less than relevant to Joe as the IRS takes a big bite out of his income.
As I explained a few weeks back, anyone who believes BO's claim that he will cut taxes for 95% of all households is smoking something stronger than the "blow" BO experimented with in high school. First and most obvious, 40% of people currently don't pay any Federal Income Tax at all. How can you go any lower than zero? With 60% of the population bearing the entire tax burden, 60% is clearly the upper limit on how many people's taxes can be cut. The truth is that the "tax cuts" BO proposes fall into two categories: eliminating taxes that nobody pays anyway, and adding refundable tax credits that people have to jump through hoops to get. Getting rid the the AMT and making Bush's tax cut permanent are both good ideas which up until now have not happened only because Democrats have blocked Republican efforts to enact them. In fact, BO voted against a bill to eliminate the AMT last year, casting doubt on his claim that he now wants such a measure. The laundry list of refundable tax credits are not actually tax cuts, but rather wealth redistribution spending increases, as you can see when you understand the meaning of the word "refundable". As stated above, government mandated wealth redistrubution is by definition socialist. BO proposes a $500 yearly refundable tax credit to individuals making less than $75,000 and $1000 yearly for couples making less than $150k. BO thinks it is a good idea to rob Peter to pay Paul in standard socialist Democrat fashion. Or in this case, he will rob Joe the Plumber, a hard-working plumber who employs 5 people and creates a significant amount of economic activity, to pay someone who employs no one and does not earn enough to pay a dime of personal Federal income tax.
McCain also wants to spread wealth around, but he wants Joe the Plumber to do it by employing people, creating jobs, producing a valuable product, growing his small business, and creating economic activity, the life blood of the economy. By contrast, BO wants to do it by government mandate, by unleashing every Democrat's favorite attack dog, the IRS on "rich" Joe's overpriviliged wallet. Biden seemed to think that there was virtue in paying higher taxes, saying "It's time to be patriotic time to jump in, time to be part of the deal, time to help get America out of the rut." BO even suggested that it was "Christian" to want wealth redistribution. We all believe in patriotism and charity, but you have got to admit that it doesn't mean as much at the barrel of a gun. It is not really charity if it is not voluntary. Try not practicing that brand of patriotism or Christian charity and watch yourself land in jail.
That sells well for the 40% of people who pay no personal income tax, until they figure out that they work for Joe the Plumber, who can now no longer afford to employ them because BO hiked Joe's taxes by $12,500. Sorry, you poor sucker. As you stand in the growing line to claim your Unemployment check, you might take some consolation in BO's assurance that "I think that when you spread the wealth around, it's good for everybody."
Too bad you can't feed yourself on those choice bits of socialist rhetoric.
Posted by Don Dodson at 10:47 AM