When it is a Barry Tax increase

Published on January 15, 2013 By Dr Guy In Current Events

Actually it is worse than that. But first to the story (or non-story for the MSM). All hail savior Obama! Restorer of the Middle Class tax cut!

The problem is he restored nothing. He did not raise that tax. But he did raise another - that of course the media is ignoring. The Payroll tax.

The payroll tax cut was 2%, until Obama raised the tax. But it really is a lot more.

When they cut income taxes X%, you do not see an increase in your paycheck of X%, but of X-Y% (the Y being the fact that there are deductions built into the tax code). But the Payroll tax (SS or FICA for you noobs) is a solid 2%. Plus It is 2% on your GROSS income. Has anyone EVER seen your "gross" income? I never have. I think my grandparents did at some time in their youth (and I am now a grandparent myself).

So the Payroll tax increase that Barry just shoved onto the middle class is not 2%, but much higher. For some, it will be a paltry 2.5%. For most, it will be a 3%. And for some, it will be 4% or higher.

Coupled with his butchery of the MSAs, Barry just jacked up my taxes by 5% (or put another way, he reduced my disposable income by 5%).

And the worst of the Obama taxes are just starting. The middle class just got royally screwed. By the man that the media said was our savior. Yea, he is saving us into oblivion.

Or as others say, with friends like him, who needs enemies?

Comments

Jythier

on Jan 15, 2013

I'm not even middle class. Anyone who gets a paycheck just got hit with a tax increase (restoration). I didn't noticed the tax decrease, because I started my 401K savings the same year as the payroll tax cut. Really, we're just back to 2010 rates, but it's still a huge hit in an area that is a regressive tax - that means that the poor actually pay a higher percentage than the rich on this one.

I noticed the tax increase.

We need a tax increase, but we also need spending cuts. Social security tax can't be used for anything but social security... so... what exactly are they planning to do with the increased income from it?

Dr Guy

on Jan 15, 2013

It was a tax increase. They will spin it as a lot of things. And I will not argue whether it was warranted or not. But the reality is it is a tax cut. I calculated what the cost would be for my family. Given the MSA cut plus the payroll tax increase, I am losing 5% of disposable income. I was not saving 5% per year. So I will have to cut spending.

We do not need a tax increase. Tax increases have never solved the deficit problem. Never.

lulapilgrim

on Jan 16, 2013

Obama taxes all done without the Senate ever passing a budget.

Daiwa

on Jan 16, 2013

I'd have to look more critically, I guess, but I thought they just let the temporary 2% FICA moratorium expire, which should have returned FICA withholding to it's prior level. Did the 'base rate' also go up? Given that SS underfunding has been an issue for a long time, they never should have implemented the 2% cut in the first place, but that was a vote-buying maneuver.

Jythier

on Jan 16, 2013

Yeah, it just went back to the way it was.

Daiwa

on Jan 16, 2013

In fact, I've been miffed at the way some public figures on the right have been clamoring about this 'tax increase'. Disingenuous at best, unless the base rate or wage base actually changed.

Dr Guy

on Jan 17, 2013

lulapilgrim

reply 3

Obama taxes all done without the Senate ever passing a budget.

So was Obamacare.

Dr Guy

on Jan 17, 2013

Daiwa

reply 4

The "Payroll" tax was a replacement for a tax cut Bush implemented. As such, it was giving maintaining a take home pay for most middle income earners, and also giving a "tax cut" to the people that paid no taxes.

However that is but one change. Many of the Obamacare taxes are starting to kick in, and the one getting me also is the slashing of the MSA. For those without a Union Health care plan, where co-pays are the norm, that is a huge hit as before we could pay for the co-pays with pre-tax money. Now we no longer can.

Plus there is the tax on the Medical devices (check out how much a kid's braces just went up). When I add it all up, it means I have $5k less disposable income (since the 2% was on gross, not net) than before. So if you "earn" $100,000, that 2% was actually more like 3%. Plus all the other taxes are based upon a gross, but as I mentioned, no one living today has probably ever seen a "gross" check. It is always netted. That means from a practical standpoint, it is not a 2% increase, but more like a 3-4% increase. For those of us who have not seen a raise in 5 years, that is a big hit.

Dr Guy

on Jan 17, 2013

Daiwa

reply 6

In fact, I've been miffed at the way some public figures on the right have been clamoring about this 'tax increase'. Disingenuous at best, unless the base rate or wage base actually changed.

It does every year. It is indexed for inflation, so the top taxable amount increases every year. But that was the way it always has been (at least since Reagan).

MasonM

on Jan 31, 2013

Oh, I'm sure that everyone having less money to spend will help the economy greatly.

Flakey101

on Jan 31, 2013

lulapilgrim

reply 3

Obama taxes all done without the Senate ever passing a budget.

What does your good book say about bearing false witness Lula?

Congress, and the Senate, passed the "Budget control act" last year, that makes the budget a law, not just a resolution, for last year and this year. So you are running under a current budget.

You need to get your terminology correct. The actual GOP claim is no budget resolution has been passed, which is technically correct, but false in that they made it a law instead, which has stronger enforcement to it, because it is against the law not to follow that budget, where as a resolution is more in the way of a guide line.

So please keep saying that no budget resolutions have been passed if you so desire, but you are very wrong in just saying no budget has been passed, because it has.

Dr Guy

on Jan 31, 2013

MasonM

reply 10

Oh, I'm sure that everyone having less money to spend will help the economy greatly.

Why else would Obama shut down his Jobs Council (other than the fact it had not met in over a year).

Dr Guy

on Jan 31, 2013

Flakey101

reply 11

What does your good book say about bearing false witness Lula?

Congress, and the Senate, passed the "Budget control act" last year, that makes the budget a law, not just a resolution, for last year and this year. So you are running under a current budget.

The books says thou shalt not. So why did you?

The act is not a budget. The senate has not passed a budget in over 4 years. The LAST one they voted on they voted down unanimously (it was Obamas).

Flakey101

reply 11

You need to get your terminology correct.

No, you do. The act merely codified CRAs. Without a budget they are required in order to (guess??) CONTINUE (the C in CRA).

BTW: The A is for act.

Flakey101

reply 11

So please keep saying that no budget resolutions have been passed if you so desire, but you are very wrong in just saying no budget has been passed, because it has.

It is correct. No budget has been passed. Again, even you admit it. The BCA is not a budget.

lulapilgrim

on Feb 22, 2013

Morning Bell: Obama and the Seuss-quester

Amy Payne

February 22, 2013 at 8:46 am

On Pennsylvania Avenue, right near the end, there lived a President who wanted to spend.

He knew spending meant power, so hour by hour, he thought up more spends from his Washington tower.

“I’ll spend without limits; I’ll spend without blame! Raising taxes to pay—that’s the name of the game.”

Down the street, though, a House filled with thriftier folk had a budget to pass, or the country’d go broke. “We can’t spend all day; we’ve got bills to pay! Let’s keep deficits and higher taxes away.”

The Senate next door to the House just refused. “We don’t like your budget. We’ve got some bad news: The President says we can spend all we want, and we’ll simply raise taxes whenever we choose.”

So they spent and they spent and they borrowed some more. And when all that was spent, they spent same as before.

But not everyone thought the spending was nice. In the House and the Senate, some spenders thought twice. “We’ll cut down on spending. We have a bad feeling…” then—SMACK!—right on schedule, they hit the debt ceiling.

Then the President’s office, confronted with debt: “If it’s cuts they want now, then it’s cuts they shall get. We’ll threaten such cuts that NO one would take, and show them that cuts are not smart to make.”

“This will make Congress move. We’ll just float out a tester… broad, haphazard cuts that we’ll call the sequester.”

The Senate and even the House said, “Okay! That will motivate us to find a good way. We’ll figure this out and stave off those cuts—to allow them to happen, we’d have to be nuts.”

So the deadline was set, but the spending went on. A year and a half had soon come and gone. The House passed a budget; the Senate said no; the President very much enjoyed the show.

“Spend higher! Spend faster! Grow the welfare rolls! Soon, love for the spending will show up in the polls.” He even raised taxes, but it wasn’t enough—the levels of spending grew too fast to keep up.

“Don’t you mind the sequester,” he told Capitol Hill. “You said you would fix it, and I’m sure you will.”

But they could not agree on ways to cut spending, and before they knew it, the sequester was pending.

“Oh no!” they all cried. “We can’t let these cuts stand!”

And the President said, “WHO thought of this terrible plan?”

They didn’t remember his plan all along. He distracted them with his spending-cut song. Now he returned to save them from harm, and to keep them forgetting all but his charm.

So the President said with a glint in his eye, “You tried to cut spending. I saw how you tried. But it’s just too painful—I’m sure you can see. From the beginning, you should have listened to me.”

“I’ll save you all from the spend-cutters’ axes. You see, the solution is just to raise taxes.”

***

We don’t know yet how this story will end. Will Congress raise taxes and continue to spend? We need a balanced budget with smarter cuts—reforming entitlements will take guts.

Let the President know that we’re onto his plan. Share this story with as many people as you can.

Original artwork by Glenn Foden.

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