Obama's Economic Perfect Storm

Well the debates are over, the pundits and talking heads have spoken; and the winner is…… Nobody. And why is that; because we have 19 days until the election and the only vote that counts is YOURS; not the polls, not the media, not your crazy buddy at work… yours and yours alone.
But one thing you have to remember is that this election as a whole; meaning Presidential and Congressional, will have an historic impact on our country. There is a distinct possibility that we could have the ‘perfect storm’ between the executive and legislative branches of government. The Democratic party could possibly had control of both houses of Congress and the While House; giving them unlimited power to change law and even constitutional amendments; with little to no resistance, and that is scary!

And why is this scary? Well let’s first take a look at Obama’s most recent statement of ‘spreading the wealth around is good for everyone’; how is punishing accomplishment and hard work good for everyone? First, Obama’s tax-rate increases on income will fall heavily on small businesses, which create the majority of net new jobs. Here’s why: According to Internal Revenue Service data, half of all business income is taxed at individual rather than corporate tax rates, and about two-thirds of all flow-through business income is earned by small-business owners with annual incomes exceeding $200,000. The bottom line: Up to one-third of all business income is taxed at the two marginal rates Obama wants to raise.Second, history demonstrates the economic folly of raising capital-gains taxes at any time, and the economic benefit of keeping them permanently low. By influencing the incentives for people to invest, the capital-gains tax directly impacts the demand for — and value of — equities. Similarly, it influences the rate of investment, particularly in new, high-risk ventures. But Obama wants to RAISE capital-gains taxes. But the bigger question is where will it stop? So today it’s $200,000; maybe tomorrow it is $100,000; or less.

And why would I say that; very simple, Obama has outlined numerous spending increases:

A $65 billion-a-year health plan
$15 billion in green energy spending
$85 billion in tax cuts and credits
A $25 billion-a-year increase in foreign aid
$18 billion a year in education spending
$3.5 billion for a national service plan

Put it all together, and we are talking about a $200 billon plan, $800 billion over four years. And that does not even include fixing the alternative minimum tax, a $50 billion-a-year item that will assuredly get passed.

Big question… HOW IS HE GOING TO PAY FOR ALL THAT???

Taking Obama’s statement of cutting taxes on 95% of Americans; there is no way that raising taxes on only 5% of the country will pay for an ADDITIONAL $200 billion in spending; the numbers do not add up. Even if he took ALL of the income of the Forbes 500 riches Americans he could only run the government for a few months; at Today’s spending levels; not counting an additional $200 billion in spending AND a reduction in tax revenues.

It is very simple… to get to a balance budget and have a surplus you can only do two things; increase revenue and reduce spending. In these economic times increasing revenue, i.e. taxes; is not advisable; however decreasing spending is advisable and warranted.

You owe it to yourself and your family to ‘peel the onion’ back on the rhetoric preached by these candidates and really get to know them and what they stand for.