Taxes & Spending

Obama Eats Crow

Make no mistake about it, Obama’s announcement that he’ll keep all tax rates at the current levels is a huge victory for the GOP.  Here’s a man who banked his presidential run on rescinding “tax cuts for the rich.”  Far from a throwaway line on the campaign trail, it was Barack’s central talking point.

For him, spiking taxes on the “wealthy” wasn’t just political positioning. It was deeply ideological, part of his core philosophy.  Here’s a man who has lamented that the Supreme Court never codified “redistribution of wealth” in our legal code, and the same dude who made one Ohio plumber a household name by telling him how advantageous it was to “spread the wealth around.”

Barack, the most anti-capitalist President in modern time, was humiliated, both personally and publically, by being forced into backing a two-year extension of the tax cuts he loathes. Obama ate a capitalist sandwich, and you know he hated every bite of it.

Moreover, this move by Barack puts his left-wing base in a tremendous bind.  After all, it was just last week that the House Democrats voted for tax hikes! Obama has now sent Vice President Plugs to Capitol Hill to get leftist lawmakers to eat this same capitalist sandwich.  These are the same leftist lawmakers, mind you, who spent nearly the entire Bush presidency railing against “tax cuts for the rich.”

It’s hard not to gloat over the left’s great agony.

Having said that, Obama’s caving isn’t a total victory for the GOP.  Forget for a moment that extending unemployment benefits another 13 months drains more private-sector resources from the economy and does nothing to spur job creation.  The fact is that, under this “compromise,” the current tax rates are set to expire in just two years. Naturally, in the short-run, it’s good news that taxes won’t be raised on any income bracket. But the quick expiration creates the same level of uncertainty that has prevented businesses from expanding and investing to begin with. Unlike Washington, entrepreneurs and business owners operate on a planning and financing calendar that goes beyond two years.

We’ll be reliving this fight in 2012. That may be sweet music to the ears of the punditry, but it is one mighty pain in the ass for entrepreneurs and small business owners.

And then there’s the left’s messaging on tax cuts that Republicans still are unable to bat down.  It’s frustrating because we know what the Democratic Party’s playbook entails. There’s nothing new about it. The Democrats fan the flames of class warfare, pitting one segment of the population against another.

“Tax cuts for the rich! Tax cuts for the rich! Bush cared only about the rich (and Halliburton)!” 

And so on and so forth.

But when Republicans engage such liberal rhetoric, they avoid tackling the immoral premise of a rapacious government’s seizing the fruits of our labor and redistributing it as Washington bureaucrats see fit. In fact, the “legalized plunder” argument, which has fueled the rise of the Tea Party, seems never to make its way into the GOP’s notes. Rather, Republicans promote tax cuts, or in this case an “extension,” on utilitarian grounds. That is, it is those much-maligned “rich” who have the risk temperament, investment capabilities, purchasing power, and entrepreneurial spirit to foster the power of job creation within the economy, which benefits us all.

As Americans for Tax Reform points out, for instance, if the Democrats had gotten their way and enacted an increase on the top two marginal tax rates, it would’ve hit the majority of small business profits—those same profits that business owners use to invest back in their companies and expand shop. We’d all lose, rich and poor alike.

But conservatism isn’t advanced by tactical victories here and there only.  Conservatism is advanced when we fundamentally shift people’s thinking back to the constitutional ideas of free enterprise, private property, and limited government.

For us, the conservatives, our starting point for every public policy discussion should begin on the truth that protecting the inalienable rights of individuals is the only reason that government exists. We are not sheep led by a governmental shepherd.  Instead, we are the shepherds and the government is around to ensure that some thief doesn’t mess with our flock—regardless of how big our flock is. In other words, government exists to enforce laws in order to maintain a civil and free society, not to tell us how to live our lives or redistribute our income.

Maintaining tax rates at their current position is good news, to be sure. But in the midst of this debate, the GOP is still not making the moral case for free markets. Republicans are still allowing our most productive citizens (the “rich”) to get whacked around like a piñata in a kindergarten classroom.  And as a result, liberals remain relentlessly committed to the politics of greed and envy. They encourage Americans, as national policy, to covet their neighbors’ goods—a principle wholly at odds with this country’s heritage.

Obama was forced to eat crow and propose a tax policy he hates. Still, if the GOP doesn’t start making the moral case and not just the utilitarian case for capitalism, the percentage of people who are comfortable—heck, who feel entitled—to live off of the productivity of others will only increase. A scary thought when almost 50% of the population already doesn’t have to pay federal income taxes.

God bless the “rich,” and their wealth-creating abilities. It’s because of them that your paycheck hasn’t bounced.

And God bless our forefathers for giving us a nation where property rights and limits on government overreach were enshrined into law, regardless of one’s pay stub. The left despises and actively battles against those freedoms, which is why conservatives can never become complacent in defending and articulating our first principles.


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