Obama’s Class Warfare

He’s launching a new era of tax and spend.

The American economy is finally coming back, after one of the slowest post-recession recoveries in recent history. So naturally President Obama has decided that what we really need now is a return to the era of tax and spend. Oh, and of course, a healthy batch of class warfare too.

The president wants to junk the sequester caps that have been largely responsible for reducing our estimated deficit from $1 trillion a year to a more manageable but still sizable $469 billion this year. He would increase discretionary spending for next year by $68 billion above the spending caps enacted in 2011, with the increases roughly split between defense and non-defense spending. If these increases are enacted, discretionary spending would increase roughly 7 percent from this year to next, compared with average growth of 4 percent from 2004 to 2013.

The president would pay for his spending spree with a massive tax hike on small businesses and capital investment. The tax hike would cost Americans $320 billion over ten years, including higher taxes on capital gains, banks’ assets, and financial transactions. He would also end the tax deductibility of earnings in the highly popular 529 College Plans.

That capital-gains increase, by the way, would give America a higher capital-gains tax rate than such competitors as Canada, Greece, Norway, and Spain. If you include the state capital-gains taxes in 42 states, we would also be higher than Sweden and Finland. And, of course, countries such as South Korea, the Netherlands, and New Zealand have no capital-gains tax at all.

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