Obama outlines budget with healthcare fund, tax hikes for wealthy
Unveiling his first budget outline, President Obama this morning said it is "an honest accounting of where we are and where we intend to go" -- including the full cost of the wars in Afghanistan and Iraq -- and focuses on basics, not items that are "nice to have."
While the country needs to add to the federal deficit in the short term to get the economy going, fiscal discipline is needed for long-term prosperity, Obama said. And that includes investments in education, energy, and healthcare that will create savings later on.
His $3.55 trillion spending plan is for the fiscal year that begins Oct. 1. It projects a federal deficit in the current fiscal year that ends Sept. 30 of a record-shattering $1.75 trillion, up from the most recent estimate of $1.3 trillion. As a proportion of the full economy, the deficit would be the highest since World War II, and the White House projects it would hover around $1 trillion for the next two years before starting to decline to $533 billion in 2013.
Obama is also pledging to cut the federal deficit in half by the end of his first term, telling Congress and the nation that his administration has already identified $2 trillion in savings over the next decade.
But White House budget director Peter Orszag told reporters today that the $2 trillion is actually $1 trillion in spending cuts and $1 trillion in tax and fee increases.
Republicans quickly trashed Obama's budget, saying it doesn't make sense to raise taxes during a recession and criticizing the level of spending.
"The era of big government is back, and Democrats want you to pay for it,” said House Republican Leader John Boehner of Ohio said at a news conference. Obama is starting to make former President George W. Bush -- whom even fellow Republicans have assailed for dramatically increasing the federal deficit -- "look like a piker when it comes to spending," Boehner added.
Senator Judd Gregg of New Hamphire, who almost joined Obama's cabinet as commerce secretary, said Obama's plan doesn't do enough to trim the deficit.
"It's like you take four steps back and then only take two steps forward," he told reporters. "I mean, basically, that's what's happening here. We're taking four steps back in the deficit fight, and then we're only taking two steps forward in the deficit fight, when the -- when if you were just to stay on the basic course you were on, you would take three steps forward."
UPDATE: Many Democrats welcomed the budget as a badly-needed change of direction after the Bush administration.
“After eight years of missed opportunities and slight of hand budget gimmicks to hide reality, this budget reflects an honest change in Washington that begins to reckon with our biggest challenges,” Senator John F. Kerry said in a statement.
“Finally we have a President who is up front about the true costs of war in Iraq and Afghanistan, and finally we have a President grappling with big challenges here at home. For too long, our tax system has rewarded exorbitant wealth over hard work. That ends today. The President’s budget will give 95% of Americans a permanent tax cut to give relief to millions struggling. The more than $630 billion committed to health care will cut costs and provide a down payment towards covering every American. The cap and trade proposal demonstrates that real global climate change solutions are a top priority for this President. This is nothing short of a sober, honest assessment of where our country stands and a tough, realistic plan to get our budget in line with our priorities.”
Obama's budget accounts for part of the cost of the $787 billion stimulus plan. It also accounts for as much as $750 billion more in aid to financial institutions, more than doubling the $700 billion financial rescue plan passed by Congress last October.
Obama also wants to set aside $634 billion over 10 years -- generated from higher taxes on the wealthy and cuts in payments to insurers, hospitals, and physicians -- as a down payment for a healthcare overhaul designed to cover more of the 47 million Americans without insurance. Advocates are calling the reserve fund the clearest sign yet that Obama is serious about taking on healthcare, even as he still tries to revive the recession-bound economy.
Obama is seeking an additional $75 billion for the wars through September, on top of the $40 billion already appropriated by Congress. The administration will also ask for $130 billion for Iraq and Afghanistan in fiscal 2010 and will budget the costs of operations in Iraq and Afghanistan at $50 billion annually over the next several years.
The plan also contains a controversial proposal to raise hundreds of billions of dollars by auctioning off permits to exceed carbon emissions caps, a major policy step on global warming.
Obama's 140-page budget outline is to be followed by a more detailed plan in mid- to late April, which he said will include the results of a line-by-line scrubbing of the budget for waste and inefficiency.
The president wants Congress to extend the $400 annual tax cut in the stimulus package that is to start showing up in most workers' paychecks in April. He also wants to extend the tax cuts passed in 2001 and 2003 for couples earning less than $250,000 per year. Those tax cuts were due to expire at the end of 2010.
The tax cuts for couples making more than $250,000 a year, however, would end as scheduled, increasing the tax rate on earnings above that amount to rise from 35 percent to 39.6 percent. Under Obama's plan, wealthier people would also face cuts in itemized deductions for mortgage interest, charitable contributions, local taxes, and other expenses -- to 28 percent from the 35 percent they can claim now.
Obama's full remarks are below:
THE PRESIDENT: Before I begin, I have some good news to report. Starting today, the recently unemployed will benefit from a COBRA subsidy that will make health care affordable. At a time when health care is too often too expensive for the unemployed, this critical step will help 7 million Americans who've lost their jobs keep their health care. That's 7 million Americans who will have one less thing to worry about when they go to sleep at night. Equally important, it prevents a further downward spiral in our economy by ensuring that these families don't fall further behind because of mounting health care bills. And it is a direct result of the American Recovery and Reinvestment Act that I signed into law the other week -- a recovery plan that has only just begun to yield benefits for the American people.
But while we must add to our deficits in the short term to provide immediate relief to families and get our economy moving, it is only by restoring fiscal discipline over the long run that we can produce sustained growth and shared prosperity. And that is precisely the purpose of the budget I'm submitting to Congress today.
In keeping with my commitment to make our government more open and transparent, this budget is an honest accounting of where we are and where we intend to go. For too long, our budget has not told the whole truth about how precious tax dollars are spent. Large sums have been left off the books, including the true cost of fighting in Iraq and Afghanistan. And that kind of dishonest accounting is not how you run your family budgets at home; it's not how your government should run its budgets, either. We need to be honest with ourselves about what costs are being racked up -- because that's how we'll come to grips with the hard choices that lie ahead. And there are some hard choices that lie ahead.
Just as a family has to make hard choices about where to spend and where to save, so do we, as a government. You know, there are times where you can afford to redecorate your house and there are times where you need to focus on rebuilding its foundation. Today, we have to focus on foundations. Having inherited a trillion-dollar deficit that will take a long time for us to close, we need to focus on what we need to move the economy forward, not on what's nice to have. That's why, on Monday, I held a fiscal summit to come up with a plan to put us on a more sustainable path. And that is why, as we develop a full budget that will come out this spring, we're going to go through our books page by page, line by line, to eliminate waste and inefficiency. This is a process that will take some time, but in the last 30 days alone, we have already identified $2 trillion in deficit reductions that will help us cut our deficit in half by the end of my first term.
For example, Agriculture Secretary Vilsack is saving nearly $20 million with reforms to modernize programs and streamline bureaucracy. Interior Secretary Salazar will save nearly $200 million by stopping wasteful payments to clean up abandoned coal mines that just happen to have already been cleaned up. Education Secretary Duncan is set to save tens of millions dollars more by cutting an ineffective mentoring program for students, a program whose mission is being carried out by 100 other programs in 13 other agencies.
We've targeted almost $50 billion in savings by cracking down on overpayments of benefits and tax loopholes -- that is money going to businesses and people to which they are simply not entitled.
This is just the beginning of the cuts we're going to make. No part of my budget will be free from scrutiny or untouched by reform. We will end no-bid contracts that have wasted billions in Iraq and end tax breaks for corporations that ship jobs overseas. And we'll save billions of dollars by rolling back tax cuts for the wealthiest Americans while giving a middle-class tax cut to 95 percent of hardworking families. But we'll also have to do something more -- we will, each and every one of us, have to compromise on certain things we care about, but which we simply cannot afford right now. That's a sacrifice we're going to have to make.
Now, I know that this will not always sit well with the special interests and their lobbyists here in Washington, who think our budget and tax system is just fine as it is. No wonder -- it works for them. I don't think that we can continue on our current course. I work for the American people, and I'm determined to bring the change that the people voted for last November. And that means cutting what we don't need to pay for what we do.
Now, what I won't do -- as I mentioned at the Joint Session speech a couple of days ago -- what I won't do is sacrifice investments that will make America stronger, more competitive, and more prosperous in the 21st century; investments that have been neglected for too long. These investments must be America's priorities and that's what they will be when I sign this budget into law.
Because our future depends on our ability to break free from oil that's controlled by foreign dictators, we need to make clean, renewable energy the profitable kind of energy. That's why we'll be working with Congress on legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy.
And to support this effort, we'll invest $15 billion a year for 10 years to develop technologies like wind power and solar power, and to build more efficient cars and trucks right here in America. It's an investment that will put people back to work, make our nation more secure, and help us meet our obligation as good stewards of the Earth we all inhabit.
Because of crushing health care costs and the fact that they drag down our economy, bankrupt our families, and represent the fastest-growing part of our budget, we must make it a priority to give every single American quality, affordable health care. That's why this budget builds on what we have already done over the last month to expand coverage for millions more children, to computerize health records to cut waste and reduce medical errors, which save, by the way, not only tax dollars, but lives.
With this budget, we are making a historic commitment to comprehensive health care reform. It's a step that will not only make families healthier and companies more competitive, but over the long term it will also help us bring down our deficit.
And because countries that out-teach us today will out-compete us tomorrow, we must make excellence the hallmark of an American education. That's why this budget supports the historic investment in education we made as part of the recovery plan by matching new resources with new reform. We want to create incentives for better teacher performance and pathways for advancement. We want to reward success in the classroom. And we'll invest in innovative initiatives that will help schools meet high standards and close achievement gaps, preparing students for the high-paying jobs of tomorrow -- but also helping them fulfill their God-given potential.
These must be the priorities reflected in our budget. For in the end, a budget is more than simply numbers on a page. It is a measure of how well we are living up to our obligations to ourselves and one another. It is a test for our commitment to making America what it was always meant to be -- a place where all things are possible for all people. That is a commitment we are making in this, my first budget, and it is a commitment I will work every day to uphold in the months and years ahead.
I want to thank all of you for being here, but I also want to give a special thanks to Peter Orszag, Rob Nabors. They have been working tirelessly in getting this budget prepared, getting it out in a timely fashion. They're going to be doing more work in the weeks to come. And I am absolutely confident that as messy as this process can sometimes be, that we are going to be able to produce a budget that delivers for the American people.
All right. Thank you.
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Having a nationalized heath care is great but it should be done as a health incentive : broken down into 4 weight groups. The people that have a healthy body fat ratio should get thier health insurance for free and the most obese group will pay $350/month.
A yearly check to see if someone smokes should also be factored also.
Terrific! As part of fiscal responsibility, we're going to raise taxes on the small business owners that hire people. To make sure that we take care of our fellow man, we're going to remove incentives for people to donate charities.
Does anyone have ambitious children? If so, what are you telling them in regards to making their hard work now pay off in the future? Is there a new lesson: are we now telling them to work hard now so they can pay more into the system in the future?
Only $250K a year? I work with a ton of small businesses who owners who clear that, but not by much. It should've been an increased tax for those with an income over $500K. Obama claims to be helping small business here, but I have a feeling he's underestimating the extra 5% increase on the families income ranging from $250K to $500K per year. Where did they get the $250K from?
The plan also contains a controversial proposal to raise hundreds of billions of dollars by auctioning off permits to exceed carbon emissions caps, a major policy step on global warming.
GRRRRRRRRRRRRRRRR It doesnt work
STUPID STUPID STUPID....
It's about time. Bring on the class warfare. Income distribution has been getting worse for a long time now. It's time to reverse that by taxing the rich that have gotten that way mostly by cheating and stepping on the backs of everybody else.
GRRRRRRRRRRRRRRR, yes it does.
Hobbit you wrote...
The people that have a healthy body fat ratio should get thier health insurance for free and the most obese group will pay $350/month.
Its kind of like people that pay their mortgages shouldnt have to pay for other peoples mortgages because they made poor decisions...
but we will have to pay that as well...
I would like to see someone cut the price o medicines. I have diabetes and with insurance I pay 185.00 for a bottle of medicine this is my co-pay.I have another that has an 80.00 dollar co-pay then I have another that has 103.00 co -pay. I am on disability and my husband is retired. So we have a fixed income.We have a home to finish paying for if we can,these quotes is for 90 day supply. With all the necessary things the medicine puts us in a hole.I am thinking about just leaving some of it off. We draw just enough to keep us from getting any help.Just wanted to share some of my story. Thanks
Are you kidding me Tom?????
If someone makes over $250 thousan a year, why the heck are you worrying about them. A five percent increase will make a noticeable difference in there pay, but it doenst matter. THey make 250,000 DOLLARS A YEAR!
This is great. Something else for free I am sure 95% of people will vote for that
Cap and trade does not work.. check out cheatneutral.com
example.. say there was a company that you could pay lets say $5.00 to and by paying this you could cheat on your wife.. the company would give that $5.00 to another couple to stay monogamous. Does it really reduce the amount of cheating going on in the world?
I think not..
It spreads wealth but doesn't reduce carbon emissions..
I'M BEHIND THIS PLAN 100%. ALL OF THE DISBELIEVERS DIDN'T HAVE ANYTHING TO SAY ABOUT OUR LAST 8 YEARS WHEN MONIES WERE BEING SPENT ON THINGS THAT HELP THE RICH AND HURT THE POOR. THERE ARE SO MANY PLACES THAT PAY THEIR CEO'S AN OUTRAGEOUS SALARY AND BONUSES AND PUT THE WORKING PEOPLE OUT ON THE STREET BECAUSE THEIR PROFIT IS NOT AS HIGH AS THEY WISH. I FIRMLY BELIEVE THERE IS NO ONE IN THE WORLD WORTH MILLIONS A YEAR IN SALARIES. KEEP UP THE GOOD WORK.
Nel,
I am in my mid-50s and have worked all of my life, including over 20 years of military service. My family has just gone over the 250K mark, so I guess we are technically rich. I resent your broad brush statement about "rich people" getting that way by cheating and stepping on the backs of everybody else. You will probably find that most people just over the 250K threshold for being rich, do not feel rich, and worked their tails off over a lifetime to get there.
Yeah, maybe we can find the $9 or $12 Billion the last Administration just LOST in Iraq. I be that would help the budget. Didn't see the Grand Ole Party fussing about that when it happened. Another casualty of War right? Can the Republicans even say fiscal responsibility looking at the last 8 years? We know they've found their voice now amazingly enough. pesky volcanoes. What did Palin think of that remark?
Not only do we pay for deadbeats who don't pay mortgages, we will soon have to pay for all the obese losers having a bypass at 30 from living off a diet of candy and cheese fries.
America 2009 RIP
The obvious advice to our children is to make sure that they seek a career in the federal gonvernment, because nobody else is going to be able to afford employees.
Thank you Comrade Obama, our own Dear Glorious Leader, who will show us the one path of enlightenment to the true socialist utopia foretold by Marx, Mao, Minh, Kim & Chavez!
Why do you suppose the "democrats" are all breaking out in monkey-bites about the Republican legislators not voting for their pork-laden "stimulus" bill? After all, it passed, didn't it? They GOT what they wanted! The reason IS because they know when the American people see that the bill DIDN'T DO what the democrats promised, learn about all the pork that was in it, and realize that the democrats blew the money that COULD have brought about a recovery, the American people will know which party did it to 'em, because the Republicans are on record as opposing the democrats shameful waste of taxpayer funds. There will be only one party to blame, the democrats can't say "They voted for it, too!", and now they're scared!
BRAVO, BRAVO, Mr. President:):)
Finally someone in Washington (White House) with a plan and a conscious with it.
Continue to stay the course and the focus will line up for whom it really counts. Not to worry about all of the nay sayers, they'll just enjoy the benefits of your very hard work and never give one thought of appreciation, let alone support!!
Aint socialism great..
BIG GOVERMENT --The President is giving the impresion that for many years there have not being a federal financial outpouring to education, health care and energy... Big Govement/liberal ideas time and time again has being proof to be a failure. There is absolutely NO MENTION t1o;1. teacher Union control in education 3. Senate corruption and involment with the banking industry 3. TORT reform and continues this lotery mentality within health care. ( Are the Lawyers taking a cut?) How many lawyers save lifes??or they are in the ER at 3-4 AM taking care for your love ones--NEVER--.But nooo lets cut our most prestigious proffesionals reinbursement.. People need to realize that Medicine is not a perfect science and as long physicians continue to practice defensive medicine and their Malp. inssurance continue to go up --health care will go up... Rather than continue to dump money in to a problem first find the root of the problem. Carbon tyrade Cap --What a Joke--that is going to affect many small and medium size bussinesses--WAKE UP PEOLPE--This is not taking America Back--we are going backwards--
reason for which
Mike, the problem is that there are a lot of people who work their asses off and make 40K a year. There has always been this big myth that hard work will get you more money, etc. After working my ass off my whole life, I have come to the conclusion that hard work alone will never get you in the +250K category . Of course, there are exceptions and you may be one. But the facts remain that income for the top 20% has skyrocketed while income for the lower 50% has basically remained flat since the late 60s. Is that because the top 20% worked harder? I think not. I've seen enough from the bankers, the insurers, the pharmaceuticals, the CEOs, etc. to think there is a lot more involved.
We should begin to look at countries in Europe and Asian (i.e. Japan) that seems to have figured out how to run a nationalized healthcare system, as well as efficient schools. I know we are the greatest country in the history of time and all, but we seem to fail epically at healthcare and education. Might be time to look elsewhere for help, and if that means spending close to a trillion dollars to solve either, then we have to do it. If we remain both unhealthy and uneducated, it will only be a matter of time before we lose out standing the the world.
I personally think taxes should be raised on anyone making over 150K and they should lower the taxes on anyone making less than $50K a year an equivalent amount.
Obama's supporters had it right. Now, you can aim low and your wonderful big government will take care of you. There is no incentive to achieve and prosper because the government will take all of your earnings and squander it on people who don't deserve it. At least global warming is going to kill us all before any of this matters.
All ylou supporters of this are missing ONE HUGE THING: Raise taxes on busness owners and not only do the stop hiring, they may actually lay off OR raise prices and then who pays?? YOU! Just what we need. More stupid socialist policies to take away from those who work hard for a living. Your ignorance is showing.
Why is Medicare going south ? In 2001 I had cancer of the Pancreas, I am one of the lucky ones. My surgeon stated there was about a 20% five year survival rate. Yes I am one of the very lucky ones. At that time I was still working and I had good company group health insurance. They paid virtually all of a very stiff medical bill. At first after surgery my insurance would pay all the post op bills (after a small co-pay of course) I wasn't 65 yet. Then when I turned 65 Medicare became my primary coverage (I had no choice), with my old insurer becoming secondary. Everything was fine for a few months until I had to go in for one of my regular 6 month exams, which included a CT scan of the pancreatic area. Well guess what ? Medicare would no longer cover this procedure (not definitive enough for reliable detection of pancreatic cancer) was the response I received from the Medicare officials here. Since Medicare would not cover any portion, my secondary insurance (who always paid for it in the past) would not even considerate it now. So I am 3000 dollars out of pocket every 6 months now for this procedure alone. Being retired and not being a movie star, ball player or politician this really hurts.
This last January my primary care physician wanted to do a yearly blood work up on me. So he sent me to the lab with a laundry list of blood test to be done. The lab people promptly had me sign a paper stating that I understood Medicare would no longer pay for a PSA test (a screening test for prostate cancer) this was now my responsibility. Again, my insurance used to always paid for this. Medicare is government, is it not ? This brings up serious questions for the elderly. Just what kind of medical coverage is Mr. Obama going to offer us ? Is it going to be real coverage, or is he going to blow smoke again ? I just have a terrible gut feeling about what is going to happen. My primary care physician was baffled at this. Upper abdominal CT scans and PSA test, although not strictly limited to of course, are primarily concerned with problems afflicting the elderly. Well just who is Medicare supposed to help ? It seems that (at least in my personal experience) the federal goons are well on their way to dictating what test a doctor can and cannot prescribe. Will they tell him what medications to prescribe next ? Why have doctors ? Simply go see your local politician. I suppose this is going to be blamed on the dead horse Bush. Waiting to see when CNN finds something Teddy Roosevelt did wrong in 1905. So what's next for the elderly ? Perhaps mandatory termination. I wonder what will be the termination date, 65, 70, surely the government won't let people live beyond retirement ? Just think of the waste. I can just see the TV ads now "Come in and tour our facility, guaranteed painless euthanasia, and with this weeks paper coupon we will even throw in a free urn, you can keep your loved one's ashes right on your mantel for all to see, only a nominal environmental burning fee of 10 dollars per pound of body weight".
Are we really sure we want mandated government health coverage ? After the past few weeks of a falling sky being rammed down our throats, I think perhaps America really should demand that we know what is in this new Obama cure all medical package. But then if we demand to know, being the stupid public that we are, our bureaucrats will simply laugh at us, just like the last time).
Will someone please tell me this not our CHANGE for the elderly ?
Mike_dallas - many many people worked their tails off for a lifetime and DO NOT make 250k/year ever. Your assumption that somehow hard work = high pay is as broadbrushed as Nel's regarding "rich people"
Also, 95% of small businesses will not get taxed additionally under this plan. If you read his entire speech as well as the resources to support this, you would understand that.
I say let the government do what they were set up to do, keep the country and the people secure and safe. Government was not set up to interfere in peoples personal lives and tax everyone to death. People need to become responsible for themselves and not rely on anyone else to pick them up. Education is available for everyone and it's paid for by the taxpayer. The least everyone can do is have the mind to get out there and get it. Even college, there are all kinds of grants to help with that. But this mindset that the taxpayer is responsible for people who don't pay their mortgages, don't take care of their families and don't want to work has go t to go, i don't care if people make 250 thou a year, they have worked hard for it and have given up a lot to be able to accomplish success. Everybody needs to do that insttead of sitting back and saying woe is me. It won't work. It will break our country.
Yeah you DISBELIEVERS get with the picture. The government is going to come and SMOKE YOU OUT! Give me a break! Survival of the fittest meant that the race only gets stronger over time. Our Government for decades has been interfering with this natural law and causing the genepool to become weaker. People were better off when they had to hunt and grow crops to eat...living off the land and adapting to the types of food available to them. Today, people can go take a plastic card handed to them and eat all kinds of crap that they were never meant to eat, resulting in obesity and the host of expensive illnesses that the government will now offer to pay for through socialist health care. But what do they care? Now we will tax fat foods and drinks in order to help all of us who take good care of ourselves and our families pay for these losers.
Why don't we begin by ceasing to send so much money oversees to these countries that supposedly "need us". Where were these cowards after 9/11?
Help those who help us. We aren't the police of the world. It's about time the USA worries about the USA for a while and gets our nation back on our feet and back to greatness. Our govenrment currently and in the past has needlessly spent billions of dollars a year on nothing
Obama: America's Cesar Chavez.
Right comrades?
IT ISN'T GOING TO WORK. " Those who don't learn by previous mistakes are doomed to failure"
Osama Obama-one and done.
Gee - the Globe didn't highlight that there's a $1.75 trillion dollar deficit. Must have been trying to avoid sensationalizing headlines of the mesiah's bad news.
A movement in the right direction is the 'High Deductable' health plan. Low preminums, high deductable. Preventive care 100% covered. Healthy people pay less, unhealthy people pay more. Coupled with the Medical Bank/Medical Reimbursement before tax payroll programs, you can manage your expenses and be covered in a catatrophic emergency. Medical care is a privilidge, not a right. If you live an unhealthy lifestyle, you, not me, needs to pay for it.
I'm all about health care for children (i think they should all be covered) but I eat healthy and exercise often so why do I have to pay for Slobby McGee down the street who is neglectful of their own health and scarfs down 3 big macs and a large fry for dinner. How about we fund health care by imposing a 30% tax on fast food. This is socialism at its finest....no need to take any responsibilty for your own actions and decsions because everyone else will pay your way.
Phasing out mortgage interest deductions eh Barack? That should really help the economy. $250k gets you to the middle class here in Boston and as a group we're already paying over 60% of the taxes in this country. I'm cutting jobs and will continue to cut more as I'm taxed more. That's reality Barack, hopefully this budget will be laughed at by the congress, but they're more inept than Obama's administration..
Where did this $250K figure evolve from anyway? In my opinion the package and plan looks to eliminate a true middle or upper/middle class. This regime will have the middle and upper class as well as our future generations paying for the mistakes of the recipients in which this plan aims to benefit- majority of which are looking for a free handout/bailout.
To Mike -Dallas-- Thank you. My sentiments exactly. I'm in the "technically rich" category and I did not cheat to get there. I believe that I worked and continue to work hard and made and continue to make responsible and conservative financial choices along the way. My largest liability every year is my tax liability which is now scheduled to increase (in large part) to assist people many of whom have made poor choices. The current Administration pays lip service to the word "responsibility" while embarking on a plan that forgives and encourages irresponsible behavior.
I keep hearing stim. checks are being mailed out, Who are receiving them and for how much? When I ask people I geet the shoulder shrug.
Our country is in a serious recession, and any Economics 101 student will learn that this is not the time to be raising taxes on anyone, period, no matter what their income is, and especially not businesses large or small - they are the ones who will play a large part in bringing us out of our current woes.. And while healthcare for everyone sounds good, we are not in any position to be talking about the staggering amount of money that will cost. Maybe at a later time, when we can hopefully see the end of this recession and a lowering of the budget deficit - if either of those things ever happens. That issue should be tabled until we get the banks and business straightened out.
Hobbit349 clearly impresses me with the use of logic to say that people should be held accountable for their own choices. Now can he/she apply this thinking to all of their thinking? If so how does socialism/collectivism work
I deeply resent paying to bail out General Motors. Any 9 year old kid with a passing interest in cars 20 years ago could have foreseen that company going down the tubes. They put out such crap for products that they could only sell to rental fleets. They've kowtowed to the UAW for generations. We've already thrown billions at them under TARP and now it's looking like it will all go down the drain anyway, unless we throw billions more. If we are going to spend billions at all, let's spend it on health care - not on horribly mismanaged corporations that deserve the inevitable death facing them.
Smahtguy, in 2006 (the latest year for which I could find data), the bottom 75% of taxpayers (those making under $64,702) paid 13.73% of the total income tax revenues. Thus, the top quarter paid over 86% of the taxes. I don't think you can cut an equivalent amount from the taxpayers making under 50k.
People what needs to happen is that the lawmakers need to be placed into the same medical and financial situation as the average American. Those of you who believe that they are obviously don't have a clue. All of what is going today by the Democrats is lips service. They are telling the American exactly what they want to hear. Just remember back when the government was collecting all of the social security taxes. For years the tax collected was a surplus, then the government (democrats I believe) decidied to use the surplus for their pork projects. Now Social Security will be dufunct in a few years. The lawmakers have their own plan which is not Social Security. The mediccare & medicaid is the same thing. We need to put these clowns into the same system that everyone else is in with no priority given to anyone. Then watch how fast these issues get resolved.
man this is awful. i am not rich. i am in graduate school, losing with myriad expenses a lot more money than i earn. but i do not think it is the responsibility of gov't to help me - i chose this life for myself. i do not think it is the responsibility of rich people to give me benefits.
i hope these policies don't last so that we can restore personal responsibility and hard work to america. otherwise there is no incentive to strive. and to those who say hard work doesn't pay off - you're wrong. it does. but part of hard work involves making connections with people who hold your future in their hands, being smart in how you work, not simply how much you work. in a meritocracy the cream *tends to rise to the top. i am so tired of people complaining about rich people. get over it. don't live off of handouts from more successful people. by and large they have earned it, are smarter than you, more qualified than you (or me), and should be compensated for their work. of course they also have a greater responsibility for the upkeep of society, but this should be accomplished as much if not more through voluntary, strategic charitable giving than blind, mandatory taxation in a backwards attempt to "spread the wealth around."
I am agree with Obama 100% no more tax breaks for the corporations who are sending jobs overseas when the americans can work here. Obama i can tell it is going to pass, and you republicans for once work with him enstead of fighting ok.. Obama is nice and honest. he is going to get this country back the way it should. no more sending jobs overseas.
I'm just curious. If we all run around in this world deciding that we don't want to help any one else, then where does that leave us? No matter what class you are or how much you make, if you're just in it for yourself...well that's part of the problem right there.
Yea there are some people who screwed up and there are some people who cheat the system, but there are also people who were fairly untreated by the system and some people who were screwed by no fault of their own...if you don't want to help those who screwed up, then you're not helping those who were screwed. You're just stepping on their back to make youself better, to help yourself be better. In the real world, that just doesn't work. Look at the other countries that have High class and low class. That's it, that's all there is. And if you're low class it's next to impossible to break out of it.
Maybe some of these people we are helping now, will make it out of their funk no matter the reason they are in it and give back in return. Because yes, potentially they will. Yes there are degenerates...People who will never change and always expect and get help. But right now that's not the issue.
Those of you who are complaining about a 5% increase in taxes after making 250 a year is rediculous. Don't get me wrong, I know many of you worked hard to get where you are and I hope some day I'll be there too and maybe even am already well on my way, however there are some people that won't ever have that opportunity. How else would we have a Dunkin Donuts or McDonalds or restaurants with Servers who only clear tips. Or Maids who clean your hotel room. Not every one can make that kind of money and it's unfair for those who don't to lose as much money as those who do. And for business owners that clear that much, but don't see it in their "personal" bottom line, and don't want to pay extra taxes to help out the people who are putting that money right back into their business, well that's plain ignorance. Chances are those people you are helping are the ones putting money into your business. We all struggle at some point in our lives and in that struggle most of us have gotten help. Whether it be generous tax deductions or help from family and friends...At some point you have to return the favor.
My family and I, wife and twin daughter age 20 months, make over$250k a year for the second year in a row. We bought a modest house and did a 30 yr mortgage. We have modest cars and we try and save as much money as possible. But, I am sorry I know some people make less than $250k, but $250k in the Northeast is not a lot of money. I am sorry people but $250k is not even upper middle class, it is maybe middle class of the middle class. People will never be able to rise of class ladder so to speak because budgets like this keep knocking us down a level. Especially when I have to pay for all of these jerks that bought houses they had no business buying. I get penalized for trying to make a better life for my family, and myself because some other people decided to get greedy and move into bigger homes and than they claim they were duped into it. I guess people can no longer read. This cannot be the answer, because the truly rich will get even richer and 5% to a person making a million is nothing, but not to a person making $250k. Lastly, that 95% of smal business owners number that keeps getting thrown around is off by 65%. It will not affect 30% of small business owners.
Hard work should be rewarded. Most successful people worked hard. You say you have worked hard and only make $40K or $50K? You should look at what you need to do to better your own situation. Like everyone, I always want to make more, but there was a time when I was VERY dissatisfied with my salary. I spoke with my manager about it, outlined my value and got a significant raise. Are those who are making less making their dissatisfaction with their salary known? Are you improving yourself to continually add value to your company? If you have done these things and are not valued - leave! As soon as the economy turns around look for a new job. I cannot stand it when people sit and do nothing and complain about their situation - the only person who is in charge of bettering your situation is you. People who make big money do this - they ask for raises, document and demostrate their value.
Then there are the people who complain about how much they make and they are a teacher or something. Well, that is the career path you chose - do you know any teachers making $100K a year? I am not saying they don't deserve it, but I am saying, they don't make that much. If you were hoping to get rich through hard work and decided to be a teacher - clearly you are missing the mark. Did you want to realize your lifelong goal of being a parametic and think you would make $250K a year? If you wanted to make $250K a year, you first must put yourself in a position that actually does have that earning potential. Expecting to make $250K a year in some positions is just not realistic - and again, I am not saying they don't deserve it - but I am saying you are not going to make that much no matter how hard you work.
I hope to be at the $250K mark someday and based on the salary increases I have seen in my career up to this point, there is no reason to think that I could not get there. I will get there all on my own AND I put myself in a position that has this much potential. I don't mind paying my fair share of taxes, but punishing success is wrong.
Nel_B, making a lot of money is not entirely dependent on effort. like you claim, you've worked hard, but have not earned the random 250K threshold. but it's ridiculous to suggest that those who have earned over that have somehow cheated something/someone. my life experience shows me a lot of it has to do with not only taking risks, but also being a bit lucky. working as hard as you can as a school teacher, for example, will not result in fabulous wealth. working as hard as you can as an entrepreneur may, but there's certainly no guarantee and you may lose it all. do you complain as much when someone loses it all? either way, being bitter because you haven't made that amount does not entitle you or anyone to take from those that have. ambition is not a sin; it's what made this country. rewarding it encourages future gains for all; punishing it...well, read "Atlas Shrugged" and you'll see.
Barry Obama is an imposter , a non-citizen, an enemy to the Constitution and is not eligble for the role according to our Constitution. He has NEVER produced
birth documents folks - and this American Idol president is destroying our contry before our eyes.
THIS IS A DISASTER AND WE NEED A REVOLUTION.
I'm make somewhat over $250K - gee never realized I'm RICH! I don't mind paying my fair share, but don't come after me like I'm Bill Gates. I already pay well over $50K in taxes. Stupidly I bought a house with a mortgage I could afford, kept my skill set current and maintained a good job, spent within my means. Dumb, dumb, dumb....
"Aim low and your wonderful big government will take care of you."
Well said. Punish success and hard work. Reward failure and lack of ambition.
Welcome to Euro-socialism.
If the government won't let anyone fail, it won't let anyone succeed.
Get in line for health care, that will be socialized ..and ruined...next.
I look forward to the day that making $250K.yr is a problem for me.
Hey COURT, you are very small minded. Good for Mike_Dallas!! He earned his money!! No one gave it to him. He doesn't suck off the gov't payroll & pension system. He went out and hustled & earned his money. He probably has a few kids that are going to college, but guess what....because he is "rich" as you like to say, he won't get any financial aid. So the $250 he's making, shrinks down to about 1/2 of that after he's done paying all the higher-end taxes. And then what's left, he gets to pay top dollar because he can't get a discount on college tuition. So you bust your a$$ your entire life, save, save, save for the kids, don't buy that new car, don't go on that trip because you save for your kids. They you're punished for saving. So I guess the lesson is don't strive to be better. I guess we should spend all our money foolishly & wait for the GOV'T to come bail us out.
I'm sorry, but that is a pathetic way to live. NObama and his O-bots are starting a huge class warfare. I, for one, do not like people who are lazy & leach off the gov't. Now that group of people is expanding. It will be very difficult to turn this ship around.
Once people get accustomed to free things, just try taking them away. They riot in the streets......when they should be working!
Erica defends the high tax idea by saying
"I know many of you worked hard to get where you are and I hope some day I'll be there too and maybe even am already well on my way, however there are some people that won't ever have that opportunity."
Thanks to Obama and socialism, NONE of our children and grandchildren will have that opportunity you speak of, to succeed based on their merits and hard work, without relying on government.
The private sector as we know it wil not exist; look at Euro-socialism, which is our future; NO ONE except those in government , or those who have inside connections to government , succeed.
$250 thousand in yearly income is not rich at all, especially in metroplitan places like Boston, NYC, SanFrancisco etc. To prove my point, most couples who make $250 k a year have the following expenses.
1) Big mortgages. To buy a decent house in MA, you need to spend $500k to be in a decent neighborhood. That would equate to a monthly cost i.e. mortgage, PMI, insurance, taxes etc of $3,000-$4,000 a month.
2) Student loans. Most couples who make $250 k a year have advanced degrees i.e. law degrees, MD, or MBAs. These professionals have anywhere from $50k-$250k in student loans. These student loans could equate to $1000-$2000 a month.
3) Child care cost. Most of these famillys need to have both husband and wife work full time to afford their mediocre life which includes paying off their mortgage and student loans. If they have 2 kids that need day care that could be $3,000 a month for both of their kids to go to day care.
4) Education cost for the kids. If they have 2 kids, you know the kids will want to go to a private university like BU, Harvard, BC etc. You would need to save $400,000-$500,000 in the first 18 years of your kids life to afford those colleges. You know you aren't getting any financial aid, because you are rich according to Obama. To save that much money in 18 years, you need to put away another $1,500 a month!!
5) Retirement cost. If you plan on retireing on 80% of your income of $250k a year. you better start saving at least 15% of your income or $3,000 a month in a 401k.
6) Medical Cost. You will more than likely be self eployed and need to pay your health insurance on your own if you own your own business. That would be at least $1,500 a month.
Conclusion. A familly of 4 which makes $250k a year is not rich!! See below
Gross Revenue $250,000/12 months=$21,000 a month before taxes
Gross Revenue after Income Taxes of 40% = $13,000 a month after taxes
Monthly Expenses
$3,000-----Mortgage for a mediocre home in Needham, Wellesley, etc.
$1,000-----Student loans for your advanced degrees
$3,000-----Day care for your kids
$1,500-----Kids college fund
$3,000-----401k, IRA, Retirement accounts. Can't count on social security.
$1,500-----Health Insurance for a familly of 4. You are self employed and are rich!!!
-------------------
$13,000----total expenses excluding food, clothing, transportation exceeds your take home pay. You are not rich if you make $250k a year. Obama should have made it $500k
conclusion
d
More politics of fear, hate and envy from Barry O.
Thanks for the money rich folks! It's about time the republican guard is on the defensive. After 8 years of the rich getting richer and the poorer getting poorer, we finally have a leader to reclaim Americans hard earned tax dollars that were given to the rich corporations for going to war. Everyone seems to forget that we are in this mess due to our fearless republican dip&hit. This recession started a while ago and the cowboy on the bull took a country to war where we should not be.
Once again it is the wealthy speaking up about "Socialism" and "frivolous spending" when it was their silent mouths collecting large no-bid contracts and reaping tax benefits from the govt. Now that seems to be changing and the rich (who need to get richer) are now piping up. I can't wait until these jerks are silenced. Be a part of the solution and not the problem republicans. And once again, thanks for the money.
Anyone else get the sense that this financial "9-11" is being used for democrat social program-lust the same way that 9-11 was used to further the republican pentagon-lust? What better time to launch a war when everyone is worried that they are going to get blown up at their local mall? What better time to stuff a trillion here or a trillion there into your favorite social program when everybody is worried about making their mortgage payments?
I'm so alienated by both parties at this point.
My only comment on the whole "reward people who bought houses they couldn't afford" thing is this.... Though I don't own a home, and am not one of these people, I can sympathize with some of the people who did. I'm guessing that they are mostly in their 30's and 40's, have children, and did whatever they had to do to get their kids into a good neighborhood and school system. Or at least as best they could. Living in the Northeast, high prices are the reality (created artificially by irresponsible lending). If I were one of these people I would take out whatever loan I could to get a decent house, in a decent neighborhood, with a decent shool system. Lets not forget where the blamee really needs to be placed... with free marketers who will never consider the consequences of moving the needle on a quarterly basis
Why work.............Socialism is here.........everyone put their hands out. Don't send you kids to college...why spend $. Why work for something better. No matter how much $ you make....there sould there should not be someone taking 40% of it. What if I came into your house and took 40% of your stuff and gave it to the guy next door.
More money to bailout banks- Hmmmm...isn't that why we pay interest and rediculous fees to banks so they can make money?
Where is the accountability?
The increase taxes are only on the income above 250k not the entire 250k.
"The tax cuts for couples making more than $250,000 a year, however, would end as scheduled, increasing the tax rate on earnings above that amount to rise from 35 percent to 39.6 percent."
Also, making 250k a year as a family does sound like a lot of money, depending on your situation. If a married couple are new doctors right out of school, what about the 300+ thousands they may owe on school loans? what about if they have a mortgage? With those big bills, what is left over doesn't make 250k seem to be as much as everyone thinks.
"eliminating tax loopholes for companies who ship jobs overseas" Let's think this one through....make it more expensive for the Multi National corporation to do business in the USA because their taxes went up....how can they cut costs? Sending more jobs overseas!!
Let's also think through the "cap and trade for carbon" idea. This system is designed to raise billions. From where you ask? Your pocket is the answer. It will increase the cost of carbon based energy so that alternative energy will be mroe economically viable. Was $4 gallon of gas "taxing" on the poor? You bet it was. $4 will be cheap if this system is put in place. You think that ExxonMobil won't figure out a way to pass on their additional costs to the consumer? Think again.
Both these plans will backfire and cause tremdous economic pain for ALL social classes. If Obama gets his way, there won't be any social classes left, we will all be poor.
This doesn't increase taxes for the rich, it increases taxes for the working!
If your rich, you don't work. Your income is capital gains and is taxed as something like 10-15%. The rich won't pay more under this plan. Educated, hard working, double income families will pay more.
You know the f'king backbone of the country.
GRRRRRRR
How many of the people making over $250K a year report small business income on their tax filings? (I think its 60-80%)
How many of the new jobs that are created in the US are created by small business owners? (~60%). By raising the tax on small business owners surely we will be reducung job creation at the very time we need new jobs.
A millionaire is not someone who makes a million bucks a year. Or a person living in a million dollar home with a mortgage. A millionaire is a person with a net worth of a million bucks.
If we want to make a truly egalitarian society we need to tax assets and not income. All that income taxes do is make it harder for people without money to become rich. Its ironic to me that most of the utra rich are pro-high taxes on income.. That's because they have already made their money.
Brave tactic, putting the budget put forth in a single pitch, a very big gamble. Over the past 8 years, budgets were submitted piecemeal, so items like the the cost of Iraq war was diluted in order to avoid causing sticker shock. I'm not sure if this admin is extremely brave or naive.
"I look forward to the day that making $250K.yr is a problem for me."
$250k per year will be a lower middle class salary in a few years once all this inflation spending money creation kicks in. That means huge tax increases for the middle class if the tax brackets aren't indexed to our inflationary future. Even without the Obama tax increases the existing tax brackets will be eating more and more of middle class earning just as the AMT does now
Budgeting another 750B for financial institutions while we already have TARP 1 expect TARP 2, along with other financial institution bailouts, seems to me like a way to approve a huge amount of money that can and will be used for other projects (because its already in the budget) when its not used for the banks.
Overall, the budget seems like is a disaster in the making - there is no way Obama can cut the deficit w/o lowering the tax ceiling into the middle class.
oh, plus....not only will the great and wonderful "O" increase taxes, he will also reduce the amt of mortgage interest you can deduct..so that's essentially another tax increase.
funny how the media fails to mention that
Did I forget the increase in Cap Gains taxes??? Oh yeah, that too.
PLAIN AND SIMPLE, THIS IS CLASS WARFARE.
Shocker stated
"If we want to make a truly egalitarian society we need to tax assets and not income. All that income taxes do is make it harder for people without money to become rich. Its ironic to me that most of the utra rich are pro-high taxes on income.. That's because they have already made their money. "
Shocker, what do you think the estate tax does??
A few points: Tom from Norwood, a lot of the expenses you cite are tax deductable. So if you gross even as much as probably $300,000 you still won't be paying the highest rate because your deductions will lower your taxable income below $250G. Not to mention, of course, that the vast majority of families face many if not most of the same expenses you do with a lot less income to deal with it. Also, you only pay the higher rate on the income over $250G.
Jenn G: Your point assumes our economic system rationally rewards the most important or socially beneficial jobs. It doesn't. Why should a hedge fund manager be paid $500 million a year and teacher make only $40G? The disparity is ridiculous and has no bearing on its societal worth.
I agree that people who make $250G are not generally the idle rich who live off investments. They should be taxed even more. Capital gains for the group making over say $500G should be taxed as income not capital gains, which currently is only taxed at a 15% rate.
Plus, I must say, since so very few people make over $250G a year, I find it hard to believe so many of them write to the Globe here. I suspect more than a few are fudging the facts to make their ideological points.
Can people stop with the 250K households are middle class nonsense? Less than 2% of U.S. households make that much.
In BO's budget, federal government debt will be 70% of GDP in 2019. That's twice as high as it is now. And he claims that is a new age of responsibility! it just proves that saying that giving money and power to politicians is like giving whiskey and car keys to teenage boys.
Where were you guys on election day? Voting for Obama like most of the people in Massachusetts?
It's funny but sad if you dan't have a job you don't get the tax cut. So if you can find a job that you are screwed not that $400 would help I will end up putting in into my gas tank anyway. you can keep my $400 dollars if it mean my wife can get a job.
Tax hikes for the wealthy? Yeah, right - Obama and his cronies are ultra-wealthy. Does anyone REALLY think they are going to raise taxes on themselves? Rest assured there will be plenty of loopholes for the hyper-rich Democrats to use. The middle class will be stuck paying the bill, as usual.
Pat in post #69 wins the prize for seeing the real agenda here.
Like the AMT, unless the $250K limit for the tax increase is indexed for inflation, it’s going to ensnare more and more of the middle class.
Do the math. The tax increases won’t kick in until 2011, and Obama’s budget projected revenues out for 10 years – that's out to 2021. If inflation runs at an average 3% per year (a pretty good number) $250K in 2021 is the equivalent of a family earning $180K today. If inflation is 5%, it’s the equivalent of $146K. And, if inflation is 7%, families making $119K today would get hit with the higher taxes.
During Jimmy Carter’s presidency (1976-1980), the last time we saw something like this, the inflation rate was an average of 8.25% per year. If Obama’s economic policies lead to the same kinds of inflation that Carter gave us, that means that the higher taxes would kick in for families earning the equivalent of $97K today.
So much for a middle-class tax cut….
RWC,
If you read the article many of the so called write offs like mortgage interest, student loan interest etc . will be eliminated by Obama. Then he will raise income tax on the so called rich. I would state he would raise taxes on the ambitious, entrepreneurial, and risk taking U.S. citizens. What will be the incentive to do well in life if you are penalized. Not only will he tax you, any money you save that you want to pass on to your heirs, will be taxed at over 50%.
Tom
For 30 plus years, my husband has worked 70 hour work weeks at his company. Our whole family has sacrificed for his job and his career. According to Obama, we are wealthy, and we dont' deserve tax loopholes, though I'm not sure we've ever had one. Our tax rate with state and federal is at 40% now. Half the country pays no taxes at all, but we will be paying half our income to the government once the new rates are enacted. After all our hard work, it is discouraging to hear people say we dont' deserve what we have and we need to share our "wealth." We had always hoped our children would have a better life than we did, but I doubt that will be possible since the country is sliding into socialism.
Everyone should read Old MO stories or even talk to people that you know from Canada about how much they like their rationed healthcare.
Everyone might have health insurance but it is going to be WORTHLESS
Ask yourself why the Elite of some of these other countries who have universal healthcare come to BOSTON and NEW YORK for treatment.
YOU ARE NOT A "RICH" OR "WEALTHY" COUPLE IF YOU MAKE $250K PER YEAR. And it just isn't right that the government, when it is all said and done, (please count state taxes, gas taxes, real estate taxes, excise taxes, sales taxes, etc) takes close to 50% of your earnings. IT IS NOT RIGHT PEOPLE, TAXES ARE TOO HIGH -- PURE AND SIMPLE.
Only the elite few are allowed to be rich in a socialist regime. 1.6 million dollar home qualifies one for this privilege. We understand Obama. Now he is going to tax the hell out of big oil, just because they have it. They are simply going to increase the price of their product to the public. If I were the big oil companies I would simply move my headquarters to another country, tell Obama to shove it and charge America what they damn well please. I am sure many have already thought of this. Take from the American rich and give to the ghettos around the world. Why does he want to destroy the American way ? And the democrats think they have had it bad. You ain't seen nutin yet. Who will pay your welfare checks when the rich are as poor as you ?
$46,000 was the adjusted gross income of my wife and I and we also had the zero claims taken out on the w-4's and itemized deductions, we still have to pay almost $1,300 in taxes that we have already had the max taken out of our taxes and we made less this year than the last two tax years. So you tell me? What did this congress do for my wife and I that all of you that voted for the administration in charge of this mess do for us.
It's obvious that if you don't make much, or don't work harder than the average person, you like Obama because he keeps helping the "poor" and those who make bad financial decisions (big credit card and mortgage debt). It took us 20 years of working holidays and weekends to make what we make today and now we will be put in a higher tax bracket when we live in NJ and already pay the most in the country for car insurance, property tax and income tax. The government at the state and federal level will take 50% of our income (39.6 federal and 9.8 state). We are not rich. We pay 17+K in property tax and live modestly. Why work hard anymore?
You know what? I am tired of hearing from the $250k complainers...and the "we are basically middle class"...whatever....you have more disposable income, drive nicer cars, live in nicer houses, have nicer clothes....your OWN choices and spending are what put you in a position to TRY and claim middle class status just because you are "barely getting by" so woe is me if you have to take one less vacation a year when people bust their tails to drive oil leaking crap cars to work or even have to take the bus or walk to work just to pay the mortgage because they have an honorable job like being a teacher which is obviously not for the money. We live in a society of overspending and we are never happy enough and can't have enough...driving through the projects or something and then look at your life...you will survive...you won't go hungry....you won't worry about where the next rent payment is coming from...sorry but put it in perspective people...