Obama heads off the tax cliff
President pushes hike for top earners
- Duration 6:39
- Date Jul 14, 2012
President pushes hike for top earners
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I'm not proposing anything radical.
I just believe that anybody making over 250000 dollars a year.
Should go back to the income tax rates we were paying under Bill Clinton.
Welcome to The Journal Editorial Report I'm -- ago that was President Obama on Monday invoking Bill Clinton.
In -- call to raise taxes on Americans making more than 250.
Thousand dollars a year he says his proposal is -- radical at all so -- congressional Democrats and maybe even some Republicans.
Follow him off that tax cliff let's ask Wall Street Journal columnist and deputy editor Dan anger.
Political diary editor Jason Riley and columnist Mary honest -- -- oh great so.
Mary we've got this huge tax cliff everybody agrees because of all these expiring tax provisions there via.
First of -- to substantively is it already affecting economic growth out.
It isn't you know the big word out there is uncertainty people feel uncertain by the way you said 250000 dollars that's for a couple.
It's actually 200000 dollars for individuals so.
And you know -- -- number Democrats who say that is way too low if you're gonna raise taxes on people which you know this is basically -- tax increase.
But -- problem is that you know people look at.
The lack of a permanency in other words he's saying when it in and the -- extend this for one year for those under -- -- and one year and that leaves you know you wondering okay how we think in -- pay for this huge deficit one year is is not going to.
And that it's not over after a year if he gets reelected.
I'm pretty sure that my taxes are going up attacks -- my small business are going up the cost to pay for Obama care is it you know put a bigger burden on us.
So all of that is making investors hold back I think.
Says the paradox why do this if you're the president if there's Mary suggests and I agree with Mary -- this is already affecting the economy negatively why do this if it's gonna hurt the economy between now and November.
-- don't think he cares.
I think honestly honestly Paul I think it is purely a political ploy to re elect him president.
They have obviously got polls out -- -- help him get reelected if the economy.
Continued -- -- -- you tell me but what trumps that in their minds is fact that they have done polling which shows that these attacks on the wealthy and the idea that.
His proposal to raise taxes on the wealthiest are polling well out in the country and in the swing states.
End of story -- long as he can get it across the goal line I don't think he cares how much economic record book.
Course if you ask people to poll you know raise taxes on the rich guys or me which do you prefer well -- always say the rich guy.
Right about the polls it was an ABC news Washington Post poll out recently.
That show that on the issue of taxes where Republicans usually -- Democrats.
Romney and the president are performing evenly.
Now the presence internal polls are also showing that perhaps that embolden them to go forward with -- tax plan.
I think he thinks the American people trust me more on this issue.
I can play this class warfare card and perhaps it'll get me past November is that a failure though of Mitt Romney's -- ability to make the tax argument because Jason's right historically Republicans have had a big tax advantage particularly when Democrats are saying all raise taxes on somebody.
I think at this point in time it is because.
I think Paul people out there with every passing week more people start paying attention to a presidential elections to life.
I think people are beginning to get nervous about the substance -- -- -- has proposed.
He gives the speech and he talks about millionaires ought to pay their fair share wait a minute we're talking about people making 200000.
That is the upper middle class those are not wealthy people.
And I think this is beginning to sink in among the electorate that that proposal really.
Touches the middle class and -- the level the middle class the people aspire to getting into you may not be able -- a million but you could -- 250000.
-- also says that this we're just going back -- the Bill Clinton tax rates and that's not accurate because it ignores the fact that under the his health care bill.
There's going to be a three point 8% surcharge new.
On investment income in particular so that means you basically capital gains are gonna go up 60%.
Dividend rate could triple.
From 15% now that's got to have an impact.
On stocks for example.
This president is making a bad.
That his narrative about how the economy works -- -- that rich people don't pay their fair share.
And they exploit the working class he's making he's betting the farm but on that marriage -- Economics that it is is not here he's basically saying that consumption tax cuts to promote consumption middle class will spend their share of the -- -- -- okay.
But tax rates on investment and savings don't matter.
But -- -- is an all consumption a function ultimately a savings and investment.
Again I think as you said today -- and I mean I think this is a failure of the Romney campaign because without somebody counteracting that argument.
I think it might be very easy for the president who is some much better political animals and Mitt Romney to make that case that somehow.
You know you're not get -- you're not getting what you deserve.
Because the rich are taking it from -- the question of whether Republicans -- -- -- ground here two years ago.
They did and he was forced to extend the bush tax cuts across the board will -- Connecticut to the end of this year.
Well so far Jason they have they've basically been saying look this is a big big tax increase on small business have been making the argument that -- -- and -- have made has since been have a negative impact.
On the economy.
So so far I don't see any breaks in and in the lines here in fact some of the Democrats in the senate have have have demonstrated some real skittishness.
About voting for a big tax increase I think one of the reasons Obama did this now.
Was to basically try to coalesce that the Democrats in the senate in particular lot of those swing state Democrats in Montana and Missouri.
-- who are running for reelection try to keep -- united behind him.
I mean what's the evidence that I -- did I guess -- going to be the question is will the growth argument trump the equity market.
Sure I mean what are we expecting 2% growth for the rest of right what do you file if we're not gonna help it if it -- -- On on on job creators is that -- -- and accelerate economic growth.
I don't think so I hope the Republicans can make an argument all right.