The Republican 700 Billion Tax Increase of 2008
We are witnessing the biggest tax increase in American history.
The President is advocating a 700 Billion tax increase to be under the control of Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke. Rushing in fact. Urgent.
Let me repeat that – the biggest tax increase in history is being pushed forward by George Bush in the form of a 700 Billion bailout of wall street.
The blame for this 700 Billion tax increase is left clearly at the feet of Phil Gram, an Aggie, like me. Which is embarrassing. But facts are facts, and as we say in Aggieland "an Aggie does not lie, cheat, or steal or tolerate those who do." That said, Phil did not act alone. But his lone actions could have prevented this.
So while I don’t understand all of the subtleties of the current
situation, what I *do* know is that NO politician wants to be known for
a tax increase. So they borrow and leave it for another politician to
take the blame.
My point is that while the iron is hot, while desperate measures are needed, the CURRENT POLITICIANS are completely 100% accountable for this tax increase.
Sure they don’t believe in balancing the budget anymore, but make no
mistake, we need to give a pass to any future politician who raises
taxes to cover this commitment from the current lot.
So in this case, the Republicans are championing the biggest tax
increase in history. And the Democrats are walking behind them saying "yes sir." Both parties clearly walking away from their base with a "hey, we gotta do it" mentality with no long term solutions.
Indeed, here we are. Here’s to new taxes, tonight is kind of special.
September 23rd, 2008 at 1:32 pm
This is the first place I have seen this “bailout” being labeled exactly as it is, a tax increase.
I would like to see the media using the term “tax increase” for any spending that is over budget, perhaps it would make people start looking at the way the government is running our economy and our future in another light.
It is laughable that the Republicans are foisting this on us while they run a campaign with talking points of keeping taxes low and hyperbole on the left’s socialist ambitions. This is socialism without even the slightest political masking of it as something other than socialism.
All courtesy of your friendly neighborhood Republican party, we have come a long way baby.
September 23rd, 2008 at 1:33 pm
I may regret saying this, but I completely agree with Newt Gingrich on this matter.
Normally, I think the man’s insane, but on this matter, he is dead right.
(It still feels weird, though.)
September 23rd, 2008 at 1:38 pm
Oh goodness, I was JUST saying the same thing over lunch today. They are going to leave a HUGE mess behind for the next administration to clear up – and it is going to cost *ME* money. It all just makes me want to weep.
After reading the link David posted, I have to say – I agree with Newt too.
September 23rd, 2008 at 1:54 pm
I’d rather bail out the people who can’t pay their mortgages vs. the banks who put out the scummy loans in the first place.
This brings out the escapist in me who says that I didn’t support the war, I didn’t advocate Bush’s “ownership culture” and have never voted for him, and who appreciates that you shouldn’t buy houses you can’t afford. I’m good with languages, right? There’s lots of good tennis to be played in France and Spain
.
September 23rd, 2008 at 2:35 pm
And so it is… our economy is now compared to a scene from The Big Lebowski. I am terribly afraid of my inablity to comprehend all of this and know the global economy may soon turn a cold shoulder to the US Dollar.
September 23rd, 2008 at 2:46 pm
Yet one more enormously expensive capricious stroll in the park for more less-than-model corporate citizens. How is it again that corporations get the rights, yet also get to shirk the responsibilities? How do I sign up for that???? That sounds really, uhm, nice and easy and… spineless.
Just infuriating, this comes directly out of our pockets and we are supposed to think ‘this is the only way’? And what will we get hit with next? Is this just softening the blog for worse to come?
September 23rd, 2008 at 3:05 pm
If you were wondering how big “700 Billion” is:
It is one third of the total amount of money received by the federal government in 2007, including social security, income tax, corporate tax, and all other receipts.
It is $140 billion more than has been spent on the Iraq war since the invasion.
It is $120 billion more than that spent on social security benefits.
per http://www.techpresident.com/blog/entry/30280/how_much_is_700_billion )
No way that kind of money gets “fast tracked” without criminal involvement.
September 23rd, 2008 at 3:25 pm
Like Son, Like Dad?
http://en.wikipedia.org/wiki/Read_my_lips:_no_new_taxes#Taxes_raised
September 23rd, 2008 at 10:08 pm
I’m certainly not an apologist for the Bush administration, nor an advocate of the numerous hacks in the investment banking community who profited wildly in the early part of this decade only to plant the seeds of a doomed system. But the simple fact is that the world’s credit marketplace is virtually dead in the water. The only ones able to borrow are those who don’t need to borrow. Companies that depend on credit to help fill their periodic gaps in cashflow are now restricted access to those funds. These aren’t companies that are irresponsible. They are just growing fast and need to spend in order to finance the costs of the growth. So literally thousands of small businesses wouldn’t be able to make payroll. Rinse and repeat. Normal folks who HAVE been paying their mortgages, will be out of work selling apples on the street corner for a nickle. My 101 year old grandmother would be happy to discuss how much fun a depression is. So vilify the bankers and the politicians and anyone else that will make you feel better. But I hope people will try to understand that the action being taken is designed to prevent a downward economic vortex that would leave any American family without 6 to 12 months of cash reserves living in their own version of Grapes of Wrath.
September 24th, 2008 at 8:19 am
@dpkpr / Dan – I *do* understand that we have to have a credit market. But shouldn’t that credit market be based on real assets and not bets-on-a-bet-on-a-bet insurance renamed “credit swaps”?
If the issue is business credit, guarantee loans backed by business credit. Our biz can borrow 80% of current assets roughly. Yet Investment Banks loan 34 times assets? Baroo?
Fool me once shame on you, fool me twice shame on me. And last time we supported this type of rushed regulation we got burned. So I’d like to see some REAL oversight.
And like I said, whoever votes for this bail out IS INCREASING TAXES. Just not this year. So future politicians will need, and justly so, to point out that everyone in office has voted to radically increase our taxes. If this is a political death for them, well, 700B makes that a political reality. Man up.
September 24th, 2008 at 1:04 pm
Good stuff, Ed! And your commentators have some excellent contributions as well!
September 24th, 2008 at 11:07 pm
I am not defending what was, I am being pragmatic and saying if you want to preserve even a modicum of a credit market in which you can borrow your .8 times (some European markets that are being used as reference points must show 200 percent collateral today, which would be a .3 times max), then we must take action. Blame whomever you like. There are plenty at fault, including the millions of Americans who borrowed more than they could afford to pay believing that the value of their property would eternally rise. But the growing political opposition to a rapid solution is not good for the economy or business or those who will be called upon to pay the “tax” as you call it. A delay will lead us into a depression in that will make every other economic downturn we’ve experienced in our lives seem like the good ol’ days.
September 24th, 2008 at 11:20 pm
Also, great to see The Chron pick up on your pissed offedness. You may want to rent the movie Network so you can go to your window and shout as loud as you can, “I’m mad as hell and I’m not going to take it anymore.”
http://www.youtube.com/watch?v=dib2-HBsF08