Tags: Obama | Budget | Raise | Taxes

Columbia’s Hubbard: Obama Budget Will Raise Taxes for Everyone

Friday, 27 April 2012 08:02 AM

Glenn Hubbard, Dean of Columbia Business School, says maintaining President Barack Obama's level of spending means everyone will pay far more taxes.

"President Obama's budget fails to identify the choices he will ask us to make. But the arithmetic is clear: His path means large tax increases for all Americans," Hubbard writes in The Wall Street Journal.

"Assuming the president favors raising marginal tax rates over broadening the tax base (consistent with his failure to consider the tax proposals from Bowles-Simpson), an across-the-board tax increase of 11 percent for taxpayers with incomes under $200,000 would be required to raise the money the president proposes to spend."

Editor's Note: Obama’s Economic ‘Fix’ is In . . .

Since Obama was elected in 2008, a rising share of the economy — an estimated 24.3 percent of GDP in 2012, according to the Office of Management and Budget, up from 20.8 percent four years earlier — has been devoted to federal spending, Hubbard notes.

The problem gets much worse, says Hubbard.

“The Congressional Budget Office estimates that, absent changes in policy, the nation will spend 10 percentage points of GDP more on Social Security, Medicare, Medicaid and related programs in 2058 than it does today,” he says.

Moreover, all of Obama’s proposed tax increases on upper-income taxpayers are projected to raise $148 billion per year. Viewed next to proposed additional spending of roughly $500 billion per year, or this year's federal budget deficit of $1.3 trillion, the president's budget faces an arithmetic challenge.

“We need a debate over what we want government's role in society to be,” says Hubbard. “Voters also must have a menu with prices — showing the true cost of the special on offer.”

Town Hall reports that even Democrats aren’t supporting President Obama’s 2013 budget, which was defeated by the House last month in a vote of 414-0. Senate Democratic leader Harry Reid says he has no plans to even bother scheduling a vote on the 2013 budget in the Senate.

Editor's Note: Obama’s Economic ‘Fix’ is In . . .

© 2021 Newsmax Finance. All rights reserved.

Friday, 27 April 2012 08:02 AM
Newsmax Media, Inc.
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved