Nemo me impune lacessit

No one provokes me with impunity


No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.

Article 1, Section 9, Constitution of the United States

If this is the law of the land...why in a republic (little r) and as republicans, do we allow mere POLITICIANS to the right to use a "title of office" for the rest of their lives as if it were de facto a patent of nobility. Because, as republicans, this should NOT be the case...just saying...

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Friday, November 20, 2009

Obama's No Tax Pledge Slips Into History

During the election campaign, September 12, 2008 during a rally in Dover, New Hampshire, then-prospective presidential candidate Obama said:
I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.
Fast forward to today...and Mr. Obama can no longer claim that he won't raise middle class taxes. Every single bill being considered for the seizure of the American health care system by the federal government will raise taxes. Here is a quick over-view of the Senate Majority leader's, Harry Reid, 2100+ page bill will raise your taxes:
1. The clearest violation is the 5% excise tax on cosmetic surgery and similar procedures (including teeth whitening). I assume that cosmetic surgery and similar procedures are skewed toward the high end of the income distribution, but there certainly are many people getting these treatments with annual family income less than $250,000.

2. The bill would allow State insurance exchanges “to charge assessments or user fees to participating health insurers, or to otherwise generate funding, to support its operations.” [ §1311(d)(5)(A) ] Health insurers would pass these “assessments or user fees” through to consumers as higher premiums. This would affect anyone who buys health insurance, including those with family income less than $250,000.
The bill would impose a 40% excise tax on health coverage in excess of $8,500 (individuals) / $23,000 (families). While policies this generous are almost certainly skewed higher on the income distribution, there are definitely families with income less than $250,000 receiving these plans. Again, health insurers would pass these tax increases through to those families.

3. The bill would increase taxes on all health insurance plans, as well as on brand-name drugs and biologics, and on medical devices. These tax increases would affect anyone who buys these goods, even if their family income is less than $250,000.
According to CBO, “By 2019, … the number of nonelderly people who are uninsured would be reduced by about 31 million, leaving about 24 million nonelderly residents uninsured (about one-third of whom would be unauthorized immigrants.)” (p. 8) These roughly 16 million people would pay “penalties” of $95 per adult in 2014, $350 per adult in 2015, and $750 per adult in 2016 and later. You’re charged half as much for each kid. Most of these 16 million people paying higher taxes will have family income less than $250,000 and will pay higher “penalties,” although not all will pay these full amounts.

4. The bill would create a new 0.5 percentage point increase in payroll taxes on individuals with incomes greater than $200,000 in 2013 and families with incomes greater than $250,000 in 2013. Since these amounts are for 2013 and not indexed, someone making $233K in 2009 would be affected by this in 2013, assuming 1% annual real wage growth and CBO’s assumptions about inflation. If you’re making $220K this year, you’ll probably be hit by the new tax in 2016. $210K this year, you first get bit in 2017, and so on.
So basically, when the federal government takes over health care, our taxes will rise, just as the cost of health care will rise. In the case of health care costs, those costs will rise dramatically. Unfortunately, it's the middle and lower classes who will pay, and pay, and pay some more. The wealthy have never had to worry about costs, but those of who actually work for a living do. Small business owners will be hit the worst. Those that I know are terrified about the impact of these bills. Not only will they be forced to lay off people in order to pay the "fees" and "fines" (taxes by any other name), but for the forseable future, they WON'T BE HIRING PEOPLE ANY TIME SOON! So much for any economic growth, at least for the next several years.

What most Democratic politicians just don't understand that small business is the engine upon which this country's economy is built. By muzzling any ability for small business growth, they also muzzle any possible job growth. A simple solution, would be for them to play the old game "Sim City" and see the direct impact of taxes and fees upon the growth of a simple city model. My experience was that when you raise taxes and fees beyond a fairly low point, growth is dramatically hampered. I seriously doubt that any politician will do so, "saying it's only a game". Yes, that's true, it's only a game and has a simple economic model, but in that context, it can be used as an excellent learning tool for basic economics.

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