So here goes!
“The State of the Union address, which is Mr. Obama’s third appearance before a joint session of Congress, offers an opportunity for the president to restate the goals of his administration as he tries to turn the election-year conversation to the economy. The speech will be punctuated with a handful of new ideas — calling for a spending freeze on a portion of the domestic budget — but aides said it would largely be an opportunity for Mr. Obama to return to the proposals that swept him into office. [NY Times]
The spending freeze is an attempt to rein in the ballooning deficit, but mostly the things affected are things like road repairs, education, national parks, air traffic control, etc. Necessary services whose budget cuts won’t make a dent in the actual budget deficit.
Here in Oregon, we just passed Ballot Initiatives 66 and 67. And what do those ballot initiatives do?
Oregon voters bucked decades of anti-tax and anti-Salem sentiment Tuesday, raising taxes on corporations and the wealthy to prevent further erosion of public schools and other state services.
The tax measures passed easily, with late returns showing a 54 percent to 46 percent ratio. Measure 66 raises taxes on households with taxable income above $250,000, and Measure 67 sets higher minimum taxes on corporations and increases the tax rate on upper-level profits.
The results triggered waves of relief from educators and legislative leaders, who were facing an estimated $727 million shortfall in the current two-year budget if the measures failed.
Oregonians did what was necessary. Nobody likes to pay taxes, but you can’t demand to have basic government services on one hand and then turn around and claim you don’t want to pay taxes with the other. Taxes are, afterall, what creates a government budget. Other states, and the Federal government should look at what Oregon did to prevent budget deficits and spending freezes.
Which brings us to Obama’s planned banker’s tax. “According to Ira Stoll,” writes Jeffrey Goldberg, “the founder of AQR Capital Management, Clifford Asness, is comparing President Obama to the Cossacks because of his attacks on… bankers.”
Some people will say Mr. Asness is over the top in comparing Mr. Obama’s proposal of a 0.15% tax on liabilities of firms with assets of $50 billion or more to a pogrom, in which Jews were thrown from rooftops, raped, and had their homes looted. And they may be correct. Still, something about the way the term “bloodsucker” is being thrown around in this discussion has certain people familiar with Jewish history (like, well, me) just a little bit sensitive.
Also floating in this cesspool, is Treasury Secretary Timothy Geithner being grilled before Congress on the AIG Bailouts yesterday.
The notion that the upper income tax bracket was never less than 70% until President Ronald Reagan reduced it to 50% in 1982 and then to 38% in 1987 (I think). It hasn’t fluctuated that much since then.
At the same time, I don’t profess to fully understand the complexities of the United States Tax code, but it seems that people struggling to get by on a day to day level shouldn’t be burdened with paying taxes — determining what that threshold is is another matter.
Finally, it also seems to me that American democracy has created a unique beast — one that creates governmental stability to keep chugging along regardless of the ups and downs of wars, economic failure, misguided regimes, etc.; but one that also is incapable of any long-term planning that may strengthen and stabilize said union, often to its own detriment.