the state of the union
The President presented his vision in a clear, well delivered speech. He outlined his programs and plans to get there.
He appealed to the people who believe government is the solution. In fact he proposed $6 trillion dollars of additional spending, spread across various programs.
Begin free education with three and four year olds, continue it through two years of community college. Additional child care support. Rebuild the roads and bridges. Healthcare subsidies.
The list was endless.
How would he pay for it? Raise tax rates on what he called the rich (anyone earning over $400K). Raise tax rates on corporations.
So what it comes down to, in my opinion, is a philosophy of government.
In America do you go out earn and achieve what you can, or do you think the government should do it for you? If your answer is the government should give it to you, then you can’t say others who toil and create have too much. We are built on individuals doing for themselves and family.
We’re one proposal from guaranteed income, an idea the generations before us would never consider, but a socialist society would.
Now you and I know that the tax increases will not cover the $6 trillion bill by raising the federal rate to 39.5% and increasing the capital gains to the same number.
What happens is, the spending never ends, and when the revenue falls short the added burden begins on lower and lower brackets. You can count on that. Check history. Remember, when the income tax was created people were laughed at who said “why someday the government might take 10% of your salary.”
Why is it that no spending programs ever go away? Why is it when new programs are introduced they are always additives? Don’t you in your household eliminate some things to do others? With the government every program only grows. Why? Because it’s your money. It’s always easier to spend other peoples money.
Thus, the Biden proposals are for bigger government, more support and less individual initiative. If you think that is the right way to make the America of tomorrow right for your children then you are for the spending.
A question one might ask is this. If the opportunity out there is so great and we are heading to new heights, why don’t we let people do what they do best and go out, get jobs and create? I keep seeing and hearing help wanted signs and establishments saying they can’t hire people because they are getting paid not to work. If we give out more does that drive people to work? We’ve created more millionaires and success than anyone because people were doing for themselves.
One thing I did learn last night was a partial answer to the question we have long asked, what is fair share?
I heard the President say those making under $400K are paying their fair share, it is those above we still need to define what it is.
I do know when we had tax rates in the 70% area in the 1970’s that our nation stalled. It was only the release from those rates that drove a boom. People invested again and individual drive was reborn.
Maybe we’re different today. I doubt it though.
Take note too, that there was no mention of lifting the SALT limit that many blue states have demanded. Lifting it would benefit the higher income individuals and cost the federal government too much revenue. Keep an eye on this because the blue state Democrats are on record as saying this must go. Any lifting of SALT makes the higher rates a fraud.
Lastly, the term “corporate welfare” and they “are not paying their fair share” has a recent example.
When we raised those rates to 35%, because after all they are only corporations, what happened? They left the U.S., and our jobs went to China, India, S.Korea, Mexico and Taiwan, among others. When we went to 21% and were competitive, what happened? We saw our manufacturing base grow.
It might sound good to say “corporate welfare,” but the reality is we compete in a global economy and raising rates is not in a vacuum, no matter how you present it.
Add this, you raise corporate rates and consumer prices go up. The people pay in one way or another.