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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: tejek who wrote (132902)	4/11/2013 3:13:48 PM
From: RetiredNow	1 Recommendation Read Replies (1) \| Respond to of 149317

I prefer neither party's approach to budgeting. They are both terrible. ------------ 6 Ways Obama's Budget Is Worse Than Everyone Thinks Fiscal Policy: Shorn of its accounting gimmicks, the president's budget isn't a "balanced" plan to get the debt crisis under control. It's a monument to fiscal irresponsibility. With much fanfare and a lot of media hype, President Obama unveiled his latest budget plan — two months late. An IBD review of Obama's budget finds that, among other things, it: • Boosts spending and deficits over the next two years. Obama's own budget numbers show that he wants to hike spending over the next two years by $247 billion compared with the "baseline," which even after his proposed new tax hikes would mean $157 billion in additional red ink. Obama claims he'll get tough on spending and deficits later, but every budget expert knows boosting spending today only makes it harder to cut later. • Vastly exaggerates spending cuts. The press has widely reported that Obama's budget would cut spending a total of $1.2 trillion over the next decade. But Obama's own budget shows that he actually cuts spending a mere $186 billion. (The relevant tables can be found at whitehouse.gov on Pages 187-190.) Obama inflates his claimed savings by first canceling the automatic sequester spending cuts he previously signed into law, then reclaiming them as new savings, and by adding in cuts in interest payments on the debt. • Relies almost entirely on tax hikes. Obama's budget shows his plan would increase revenues by $1.14 trillion over the next decade. That means his budget proposes $6 in new taxes for every $1 in spending cuts. • Cuts the deficit less than claimed. "My budget will reduce our deficits by nearly another $2 trillion," Obama said Wednesday. But his budget shows total deficit reduction over the next decade would be just $1.4 trillion. Plus, deficits start rising again after 2018. • Creates a new entitlement without a reliable means to pay for it. Obama claims he can finance a new $76 billion "preschool for all" program by raising tobacco taxes again. But after an initial spike, tobacco tax revenues will start trending downward year after year as more people quit smoking, while the costs of this new program will keep climbing. The last time Obama hiked tobacco taxes — to pay for an expansion of Medicaid — revenues came in $2.2 billion less than expected. • Boosts taxes on the middle class. Obama proposes to change the government's "consumer price index" in a way that will lower the official inflation rate. He's selling it as a way to cut Social Security annual "cost of living" adjustments, which are based on the CPI. But because his "chained CPI" would also apply to annual tax bracket adjustments, it will end up hiking taxes by $124 billion — mainly on the middle class — over the next decade through bracket creep, according to the Congressional Budget Office. In his remarks Wednesday after releasing his 65-day-overdue budget, Obama claimed: "The numbers work. There's not a lot of smoke and mirrors in here." Fact is, if it weren't for smoke and mirrors, Obama would have no budget plan at all. Read More At Investor's Business Daily: news.investors.com Follow us: @IBDinvestors on Twitter \| InvestorsBusinessDaily on Facebook

To: tejek who wrote (132902)	4/11/2013 3:19:34 PM
From: RetiredNow	Read Replies (1) \| Respond to of 149317

Here's a description of Obama's tax proposals. I can get behind this. Looks good to me. GOP will never go for it, though. ------------- How Obama's budget would hit the rich By Jeanne Sahadi @CNNMoney April 11, 2013: 2:08 PM ET NEW YORK (CNNMoney) Throughout his time in the White House, President Obama has pushed for the wealthiest Americans to pay more.The oft-stated goal: to help reduce deficits, help pay for new investments and make the tax system "fairer." Of course, some broad proposals in his 2014 budget would affect people up and down the income scale. For example, he would raise cigarette taxes and change how inflation is calculated. But he also includes several measures that specifically target high-income households. Cap value of tax breaks: As he has proposed before, Obama wants to limit the value of itemized deductions and exclusions for high-income households. Normally a taxpayer multiplies her top tax rate by the amount of a deduction to calculate the taxes saved. But Obama would cap that rate at 28%, which is below the top two income tax rates. So, for example, someone in the 39.6% bracket today would save $39.60 on a $100 deduction. Under Obama's proposal, she would save $28. Besides itemized deductions, the limit would apply to tax-exempt interest, employer sponsored health insurance, retirement contributions and foreign excluded income, among other things. The administration estimates the measure would affect the top 3% of filers. Roughly speaking, that means those making more than $200,000 ($250,000 if married). The proposal would raise an estimated $529 billion over 10 years, making it the single largest revenue raiser in Obama's budget. Enact a Buffett Rule: In 2011, Obama proposed the "Buffett Rule" as a guiding principle for tax reform. The idea: to make sure that people earning more than $1 million don't end up paying a lower overall federal tax rate than many middle class taxpayers. His budget this year proposes the more concrete "Fair Share Tax." It would impose a minimum 30% effective federal tax rate on people with adjusted gross incomes above $1 million, although it phases in for those making between $1 million and $2 million. The income threshold would be adjusted for inflation every year. Taxpayers would get a break for charitable contributions when calculating what they would owe. Last year, the Tax Policy Center estimated that about 0.1% of all households would owe more as a result of a Senate bill nearly identical to Obama's Fair Share Tax. The average tax increase for those affected? About $173,000. All told, the proposal is estimated to raise $53 billion over 10 years, without a cap on itemized deductions. Increase the estate tax: The president is again calling for the federal estate tax to revert to 2009 parameters. Under those parameters, the first $3.5 million of one's estate would be tax-exempt and the portion above that would face a top tax rate of 45%. That would be a bigger tax bite than the current estate tax, which was made "permanent" by the fiscal cliff deal passed at the start of the year. That deal set the exemption level at $5.25 million adjusted for inflation and the top rate at 40%. The Treasury Department estimates the change would raise $72 billion over a decade. Impose new limit on tax-advantaged retirement accounts: Obama would limit the tax-advantaged portion of an individual's retirement savings. The value of defined contribution plans like 401(k) and IRA accounts, as well as defined benefit pensions, would count toward the limit. The account balance threshold would be based on what could finance an annuity of $205,000 a year in retirement. In 2013, that would be $3.4 million for someone age 62, or $3 million for someone age 65. At that threshold, the proposal would affect far less than 1% of IRA and 401(k) account holders, according to estimates from the Employee Benefit Research Institute. Depending on how the threshold is adjusted in future years, however, that percentage could rise significantly. The Treasury estimates the proposal could raise $9 billion over a decade. Raise tax rate on investment fund manager income: Managers of private equity, venture capital and hedge funds are taxed 20% on the portion of their compensation known as carried interest, essentially paying the long-term capital gain rate. Obama wants carried interest to be treated as ordinary income. The result: wealthy fund managers could pay a rate as high as 39.6%, or more than 2.5 times the rate they pay now. The proposal is estimated to raise $16 billion over 10 years. Raise Medicare premiums: Currently, higher income Americans pay more in premiums than the average enrollee for Medicare Parts B and D. Those are the Medicare programs that cover doctor visits and drug costs. The higher premiums are paid by individuals with incomes over $85,000 ($170,000 for married couples) -- a lower threshold than typically considered high income. Obama has called for a further increase in their premiums by 2017. He also made a second proposal that would capture even more people. Right now, the $85,000/$170,000 income thresholds are frozen through 2019 and then will start to adjust for inflation. But Obama has proposed to freeze those thresholds until 25% of all Medicare beneficiaries meet them. Currently only about 5% of those in Part B and 3% in Part D are already paying higher premiums, according to the Kaiser Family Foundation. The proposal would raise an estimated $50 billion over 10 years.