Obama tax hikes defended by myths and straw men

"President Barack Obama has called for a huge, $921 billion tax increase beginning on January 1, 2011, and congressional Democrats have signaled their intent to meet his request and more—after the mid-term elections.[1] To achieve the bulk of this increase, the Democratic leadership need merely do nothing: The tax relief enacted a decade ago during a mild recession is scheduled to expire and Congress apparently intends to let this tax relief lapse in 2011 coming out of a severe recession.

In the big picture raising taxes is not about the size of the deficit but about a vision for America and the appropriate size of government. Federal spending has exploded under President Obama. It now consumes around 25 percent of the economy, producing dangerous and unsustainable deficits. Either Congress and the President return spending to historically normal levels of about 20 percent of the economy, or taxes must go up dramatically. While the long-run budget picture remains the greater threat, current deficits are a severe and immediate threat that must be addressed very soon.

The state of the economy today plays an especially critical role in how Congress should respond. The unemployment rate hovers near 10 percent and is likely to remain highly elevated for years according to the Administration’s own economic forecast. The American economy seemed poised to recover earlier in the year, but is restrained by a number of factors internal to the economy such as ongoing weakness in the real estate market, factors external to the economy such as a potential slowing of export markets abroad, and especially by the broad erosion of business and consumer confidence due to policy threats from Washington. For all the talk of jobs, jobs, jobs, Washington policymakers appear singularly intent on inhibiting job creation. The Obama tax hike arising from the expiration of long-standing tax relief is but one example of many...."

The full text of this article can be found at the Heritage Foundation.

In the rest of the article, J.D. Foster highlights and explains the numerous myths that Democrats use to persuade Americans that tax hikes will benefit the country:

"STRAW MAN: Extending current tax policy will not stimulate the economy.

REALITY: While extending current tax policy will provide at most a modest boost to the economy, raising taxes will slow down recovery.

MYTH: Preventing a tax hike is a tax cut.

FACT: Extending the 2001–2003 tax provisions is not a tax cut; the failure to extend any of these provisions as Obama proposes is a tax hike.

MYTH: An extension of the tax cuts must be paid for.

FACT: It is neither necessary nor logical to raise taxes to avoid a tax hike elsewhere.

MYTH: Higher tax rates would not weaken the economy in the short run.

FACT: Higher tax rates would sap the recovery.

MYTH: Small businesses would be only marginally affected by higher taxes rates.

FACT: Successful, growing, hiring small businesses are especially targeted by higher tax rates.

Myth: Tax rates matter little in the long run.

Fact: Tax rates have their most powerful effects on long-run growth and wages.

MYTH: The country cannot afford not to raise taxes.

FACT: The problem is spending, not revenues. The country cannot afford to let current spending levels continue.

MYTH: The Obama tax hikes would alleviate the long-term budget crisis.

FACT: The Obama tax hikes, while enormous in their own right, are almost inconsequential compared to the size of the unfunded spending in Social Security, Medicare, and Medicaid.

MYTH: A strong economy will solve America’s budget woes.

FACT: A strong economy will help, but only aggressive spending reductions will restore a sound fiscal policy.

MYTH: President Bush intended the tax cuts to expire.

FACT: The tax cuts were intended to be permanent and were enacted on a temporary basis solely to overcome a parliamentary hurdle."