I was told to get the hell out Washington, D.C., that it was no longer safe to be here. I was told that I couldn’t survive, that nobody could survive, that we are all doomed. I was told to run--run from here, run anywhere ... but that it didn’t matter. Nowhere is safe, we are all doomed.
Admittedly, I was informed of these grave matters by a homeless man with a wild beard and gutshot eyes. He was hysterical and probably a little high, but I’m not sure how that makes him very different from a lot of the folks in this town, especially the ones writing our national laws. He made sense to me. I thought about dropping all the worldly possessions I had on me (an iPhone, some pocket lint, and a hideous tie) and following him through the city, absorbing his otherworldly wisdom.
Then it hit me. This wasn’t about the Apocalypse. Not even another terrorist attack on our city. No, this was something far more ominous. He was talking about the implosion of Obamanomics, the unintentionally ironic “Recovery Summer,” the upwardly creeping rate of unemployment despite a veritable orgy of government “stimulus” spending and, god help us, a rapidly approaching election prompting the liberal braintrust of Congress to feel the need to do something.
It is true. We are doomed.
The last time this particular Congress felt the need to do something we got Obamacare, tax increases, and a hideous display of engorgement on taxpayer money the likes of which we haven’t seen since King Louis XIV built the Palace of Versailles. It may indeed be time to start stockpiling canned goods and bottled water in a hollowed-out basement.
So what’s next on the Need To Do Something agenda?
Raise taxes, of course. Again.
For an administration that warns so frequently about not going backwards, this one returns with disturbing frequency to the same parched well--take money from some people and give it to others (usually government). In this case, the White House intends to raise taxes on the business community to ... uh, give it to the business community.
For example, President Obama proposes making the Research and Development tax credit permanent. A good idea. It will help companies stay competitive. Should have been done a long time ago. The problem? He wants to raise taxes on many of the companies that could use such a credit, and plenty that can’t. He calls it “closing corporate loopholes.” Most people would call it what it is--a new tax on the private sector. To the tune of $100 billion.
The federal hunger for new taxes doesn’t stop there. Obama proposes to spend another $50 billion on roads and infrastructure. This above the billions spent in his earlier stimulus package. And how will he pay for it? If you say “cut spending elsewhere,” you won’t be allowed in this barroom game of trivia ever again for spouting such drunken silliness. No, we’re looking at more corporate tax hikes on the business community.
And then there is mother of all tax hikes. The White House intends to let the Bush-era tax cuts for the top two tax brackets expire. The rates currently at 33 percent and 35 percent will jump to 36 percent and 39.6 percent respectively.
We’re told that only “wealthy families” and “wealthy individuals” (think Rockefeller and Old Man Potter) will pay these new taxes. Even better, some of that revenue will help pay for policy proposals meant to help small businesses create jobs. The only problem is that many small business owners pay their taxes at the individual rate--putting them, by Obama’s definition, into that class of pot-bellied millionaires who deserved to be soaked. These business owners aren’t pocketing their revenue, though; they are reinvesting it in their businesses--paying for salaries, rent, healthcare, office equipment and other forms of overhead. You know, creating jobs.
Except it’s going to be a lot harder for these small businesses to create--or even save--jobs as they are struggling to pay for new taxes. If this administration gets any more business friendly, the Summer of Non-Recovery may go on forever.
And you can smell it now. The fear is settling in like smog over Los Angeles. Business owners--small, large and in-between--don’t know what their tax rates will be in any given year, don’t know what other “corporate loopholes” they face in the coming years, don’t know what new regulations await them, don’t know how much their health insurance premiums will continue to spike as a result of Obamacare and they are watching the stock market spin up and down like a yo-yo. As a result, they aren’t hiring, they aren’t buying, and they aren’t expanding. They’re huddled in the corners of their offices in fetal positions.
Hence, 9.6 on the unemployment Richter Scale.
If the administration is serious about getting the economy back on track, it should quit trying to “do” so much. Forget about eight-kajillion-dollar stimulus bills. Forget about costly and over-reaching liberal programs framed as cost-cutting endeavors. (Remember how the new health care entitlement was really a way to “bend the cost curve” downward on the nation’s debt? Yeah, Democrats on the campaign trail are trying to forget about it too.) Forget about Cash for Clunkers and Cash for Caulkers and Cash for Desperate Congressman in Tough Re-Election bids. And forget about perverse efforts to cut taxes by raising them; small businesses can only handle so much of this kind of relief before going bankrupt.
The simplest solution is to do what Congress finds most difficult –nothing. Well, almost nothing. Quit scaring hell out of the private sector, and make a commitment to not raise taxes anymore. Don’t let the lower tax rates currently in place expire, especially in the middle of this turtling economy.
Pay attention to that crazy sonofabitch on the street corner. He may not be homeless at all. He may just have been a small business owner stumbling along, brain-stunned and drooling as wonders how long his business can last with all of these costly programs coming out of Washington to help him.