Top 5 False Claims From Obama’s Address to Congress

 

IMHO, the Administration is operating under flawed logic. The simple truth is, they knew, and either didn’t care or saw more upside in pretending different. Facts! For those who care to read or listen.

 

 

 

Top Five False Claims from Obama's Address to Congress

http://www.regularfolksunited.com/index.php?tab=article_view&article_id=1088

 

CLAIM #1: "...not because I believe in bigger government – I don’t."  

FACT:   When Obama took the oath of office, federal spending for 2009 was on track to be about 22 percent of GDP, according to the CBO. Now with the passage of the trillion dollar Pelosi-Reid-Obama spending and debt plan, spending could hit 30 percent of GDP this year. That would be the highest level since World War II, and the biggest one year jump since Pearl Harbor. If that's not a belief in bigger government, then what is?    

 

CLAIM #2: "A failure to act would have worsened our long-term deficit by assuring weak economic growth for years."  

FACT:  When the government spends more money, it crowds out the private sector. 30 percent of GDP being spent by the government leaves only 70 percent for the private sector. Over time, it's the private sector--not government--which grows the economy. When the private sector gets crowded out, economic growth gets choked off.    

 

CLAIM #3: “Because of this plan, 95 percent of the working households in America will receive a tax cut – a tax cut that you will see in your paychecks beginning on April 1st.”  

FACT:  This is a mathematical impossibility. According to the IRS, there were over 138 million families filing income tax returns in 2006. Only 93 million returns paid income tax. That means that one-third of households had no income tax liability in 2006 (and this doesn't even account for those households that don't have to file tax returns, like most seniors). You can't cut taxes on 95% of families when one-third of them don't pay income taxes.   According to the Joint Tax Committee, 15 percent of families have neither an income tax nor a payroll tax liability.   No matter which way you slice it, you can't cut taxes for 95 percent of families. It's impossible. All you have left for the low end of the income spectrum is spending money, using the tax code as the distributor.    

 

CLAIM #4: “We will restore a sense of fairness and balance to our tax code by finally ending the tax breaks for corporations that ship our jobs overseas.”  

FACT: The U.S. is one of the only countries left in the developed world that double-taxes the international income of our companies. In order to ameliorate this double-taxation, a host of credits, deductions, and deferrals have been put into the tax code.   It would be far easier to simply conform to Japan, the U.K., Canada, and the rest of our trading partners by taxing only income earned in the United States. But making the double taxation problem worse by "closing loopholes" is a clear path toward outsourcing jobs and companies to friendlier nations.    

 

CLAIM #5: “In order to save our children from a future of debt, we will also end the tax breaks for the wealthiest 2% of Americans. But let me perfectly clear, because I know you’ll hear the same old claims that rolling back these tax breaks means a massive tax increase on the American people: if your family earns less than $250,000 a year, you will not see your taxes increased a single dime. I repeat: not one single dime.  

FACT: To be clear, the top 2 percent is a lot closer than you might think. According to the IRS, a family is in the top 2 percent of income if it makes about $300,000 per year. That's a comfortable family, to be sure, but not exactly the image of the Monopoly man that Obama would seem to imply.    

 

Let's take a look at the top 1 percent, the truly "evil" in the Obama-Pelosi-Reid worldview. According to the IRS, they earn about 20 percent of the income in America, but pay 40 percent of the income tax. The top 5 percent pay 60 percent of the income tax. The top 10 percent pay 70 percent of the income tax.   Does the term "blood from a rock" mean anything to President Obama?  

Furthermore, most of the small business profits are earned in these top-two percent households. 40 percent of the sole proprietor profits are earned there. Almost 90 percent of business partnership and Subchapter-S corporation income is earned there. All told, more than $2 out of every $3 in small business profit is earned by families that Obama said he was going to raise taxes on last night. Since small businesses pay their business taxes on their owners' 1040s, to raise their taxes is to raise the tax rate on the lion's share of small business profits in America.

Josie06 Josie06
56-60, F
12 Responses Feb 28, 2009

Sorry. Maybe it would have been better if I had merely passed judgment on your lack of thought, your parroting of republican spin points, your inane drivel recirculated from the rightwing spin machine...then again, that is all you ever show us, so what else are you?

bitlord comment: "Right.<br><br />
Let's put all workers everywhere out of jobs so the economy spirals out of control into a global depression because YOU want pure brutal capitalism.<br><br />
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You're a very bad joke Josie!"<br><br />
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Thank you bitlord ... for passing judgment on me.

Right.<br />
Let's put all workers everywhere out of jobs so the economy spirals out of control into a global depression because YOU want pure brutal capitalism.<br />
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You're a very bad joke Josie!

Bankruptcy is there for a reason ... business that can't make it and make terrible mistakes. CEO salaries or any other bad business decision.<br><br />
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They should fail ... not be rescued by the government to fail at later date.

steve...you are generalizing. the stock holders (investors) elected these CEO's and set their pay. If their companies fail, the stckholders lose. The government should have kept their nose out of it and let them fail. I am not envious or angry with the CEO's or their companies...I am pissed that the government is using my money to prop them up.<br />
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You should read up on basic economics of a capitalistic system.

the obsecene alaries of the ceo's of failed companies should have been allowed to fail. Then there would have been the change needed to correct this. Instead the government is not letting this bad management fail as it should.

How about the obscene salaries of the ceo's and other top employees of companies which have failed aor lost billions. If the ceo's are so f****ing smart and worht ebery one of the millions of dollars some of them make, how come their company failed or lost billions? Surely, if they had to pay a few hundred thousand dollars more in takes, they would somehow be able to survive.

Let's look at the underlying phrase: 'To each according to his ability."<br />
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i believe this is the basis of the progressive tax rates in the US. The more you make the bigger piece of your piece the government gets.<br />
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#1. How about a flat tax. Say (for this writing) 10% of everyone's income. 10% of $20,000 = $2,000 or 10% of $250,000 - $25, 000 or 10% of $1M - $100,000. Seems much fairer and spread the burden across society.<br />
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It is never as we see it or as simple as we make it. Let's look at who pays the tax in America (i hope some take the time to read these):<br />
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http://www.ntu.org/main/page.php?PageID=6<br />
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http://www.american.com/archive/2007/november-december-magazine-contents/guess-who-really-pays-the-taxes<br />
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(2002 data) http://usgovinfo.about.com/od/incometaxandtheirs/a/whopaysmost.htm<br />
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http://www.fairtaxblog.com/20060524/who-pays-taxes-in-the-usa/

Josie I have never been able to understand the thinking of some who feel that because someone has more they should be forced to give more.<br />
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Giving to help others is not something that should be forced upon someone. Many do not seem to look at the fact that those who make much inaddition to paying more in taxes or many of the same ones who keep many charities working. <br />
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Many of these people worked hard and earned their way to where they are. There are many of these people that give back so much in their communities due to how much they have. <br />
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Are there some bad apples in the bunch. Yes, but there are bad apples in all bunches. Yet throwing out the whole basket because of a few is wrong.<br />
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The effects of this so called new tax plan is going to do far more damage then many realize. The so called rich of this country do a lot of good in many areas other than job creation. The snowball effect of putting an enemy target on them is going to take the country from it's knees to it's being flat on it's face.<br />
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Once the snowball starts rolling it will be hell to stop if at all. We need to look past the bad apples in the basket and look to the rest of the basket because it is that group that is the model of the American Dream.

We'll make it easy is to understand? It is always easier to spend someone else’s money than your own.<br />
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If someone has lots of money the thought will always be they can afford to lose or give up some. The question is one of fairness.<br />
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Is it fair to burden others with taking care of someone not their family?<br />
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In some ways i might answer yes. But what we seem to think is that we can force people to do this and exclude others. That id not democracy rules, that is more mob rule.

steve824, you have a point. But frankly, i don't think you see the big picture on this. Just a small one on how the rich can afford to pay. There is more to how an economy and a nation works than that.

People always talk about small business. When was the last time a business person said "Damm, I was going to start a business but the federal taxes were too much" or "Damm, I was in business and everything was going well. Then, the government changed some tax rule and I closed my doors the very next day. It was IMPOSSIBLE for me to pass on the cost of the taxes to my customers."<br />
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The people who make over 250,000 per year will have there taxes increased. I am betting that they will not miss a meal or a vacation or a big screen tv or clothes or anything else. I do not hate you if you make more money than me. I just want you to pay your fair share of taxes.