Ten Tax Facts for Tax Day Tea Parties

/PRNewswire / -- President Barack Obama and the U.S. Congress have gone on a spending and debt spree that the country cannot afford. As a result, a spontaneous grassroots movement is emerging from every corner of the nation with a message for Congress and the President: Stop spending us into an inevitable spiral of debt and higher taxes ... now!

To that end, groups of Americans will be meeting in towns and cities across the nation on April 15 for "Tax Day Tea Parties." These "Ten Tax Facts" are an effort by the Institute for Policy Innovation (IPI) to make sure the American people are well-informed as they gather together to express their concern about the direction Washington is headed.

#1 .Under the Obama budget, the Congressional Budget Office (CBO) projects that the national debt will double over the next five years; and it will triple over the next 10 years to $17.3 trillion.

#2. Under the Obama budget, CBO projects that the national debt will soar over the next 10 years from 40 percent of GDP today to a shocking 82.4 percent. (Ronald Reagan left office with the national debt at 42 percent of GDP).

#3. The President's budget also states that total federal borrowing will grow by $2.7 trillion this year alone, an increase of 27 percent in one year!

#4. The budget President Obama proposes for this year increases federal spending by an incredible 34 percent over the previous year, with a total of $4 trillion in federal spending, the highest ever.

#5. The federal budget deficit (not the national debt) would reach $1.845 trillion this year, according to the CBO, the highest ever. That would be more than seven times Reagan's largest budget deficit of $221 billion, which caused so much consternation among Reagan's critics.

#6. The CBO estimates that this Obama budget deficit will total an astounding 13.1 percent of GDP, more than one-eighth of the entire U.S. economy, for the federal budget deficit alone! Under George Bush, the federal deficit for 2008 was 3.2 percent of GDP. The deficit for fiscal year 2007, in the last budget adopted when Congress was controlled by Republican majorities, was $162 billion, or 1.2 percent of GDP.

#7. The Obama budget also includes $1 trillion in tax increases on the upper 5 percent of income earners, mostly tax rate increases. But the top 5 percent of income earners already pays 60 percent of all income taxes.

#8. The Obama budget projects that revenues from the corporate income tax will more than double in 3 years, increasing, in fact, by more than 124 percent.

#9. Another $645 billion tax increase comes from President Obama's anti-global warming cap and trade system, which is essentially an energy tax on the production and use of carbon energy, such as oil, natural gas, and coal.

#10. While the Obama administration claims to have cut $2 trillion from the budget over 10 years, fully $1.5 trillion of those "cuts" actually represents the troop drawdown in Iraq, which was already scheduled to occur under the Bush administration. Of the remaining $500 billion in budget "savings," fully $311 billion is categorized as "interest savings" but is actually an additional tax increase on upper income earners.

It's not as if you can't stimulate economic growth while at the same time cutting government spending. President Reagan did it. Reagan adopted budget cuts soon after he entered office equal to close to 5 percent of the federal budget at the time. Even with his defense buildup, total federal spending declined from a high of 23.5 percent of GDP in 1983 to 21.3 percent in 1988 and 21.2 percent in 1989. That's a 10 percent real reduction in the size of government relative to the economy. Reagan's policies conquered inflation and started a 25-year period of economic growth, which would look awfully good today.

Obama's Speech Filled with Rhetoric, Wishful Thinking, According to Fitzgerald Griffin Foundation Columnist, Robert Hale

/PRNewswire/ -- The Fitzgerald Griffin Foundation website, http://www.fgfbooks.com/, released a column yesterday critiquing 14 points from President Obama's speech on Tuesday. North Dakota attorney and builder, Robert L. Hale, takes the President to task for "wishful rhetoric" and his "clear misunderstanding of how markets work."

Some of Hale's 14 points include:

--The President said: "In order to save our children from a future of debt, we will also end the tax breaks for the wealthiest 2 percent of Americans." Hale comments: "Does it seem a realistic that two percent of Americans are going to pay off a federal debt estimated to be between $12 trillion and $19 trillion?"

--The President said: "We have done more to advance the cause of health care reform in the last thirty days than we have in the last decade." Hale replies: "What has been provided is health care insurance -- not health care reform. Nothing has been done to reform a health care system that is bloated by massive Medicare and Medicaid mismanagement.

--The President said: "...we will put Americans to work making our homes and buildings more efficient so that we can save billions of dollars on our energy bills." Hale replies: "As a builder for more than 30 years, I can state unequivocally this is a fiction. It is simply cannot be done.

--The President said: "I'm proud that we passed a recovery plan free of earmarks." Hale comments: "Yet news reports identified up to 9,000 earmarks in Congress' $410 billion omnibus spending bill."

--The President said: "The ability to get a loan is how you finance the purchase of everything... and [how] businesses make payroll." Hale responds: "Businesses do not make payrolls with loans. Those that do, don't stay in business; they fail."

For more than three decades, Mr. Hale has been involved in drafting proposed laws and counseling elected officials in ways to remove burdensome and unnecessary rules and regulations.

"For those who listened carefully and understand how sustainable jobs and prosperity happen, the President's speech was a terrible disappointment," Mr. Hale said.

LNC Chairman Response to Obama and Jindal

-Libertarian National Committee (LNC) Chairman William Redpath released the following statement Wednesday:

“Americans have always bounced back from adversity by exercising the freedoms guaranteed by limited government, which is why Libertarians are so disappointed in the recovery-delaying policies laid out last night by President Obama.

“No nation has ever spent its way out of a recession. In fact, budget-busting policies, like those proposed by President Obama, and our society’s overreliance on debt, are largely what got our economy into this needless situation.

“Obama’s statement that ‘A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future’ was particularly disturbing. He wrongly assumes that tax money belongs to government, not the taxpayer it was taken from, and only government can create prosperity. The private sector’s investment, not government’s, is what is really responsible for the wealth of ordinary Americans.

“The American people know better. They know entrepreneurs, not government, create prosperity for all. That is why they agree with Libertarians that tax relief for employers and taxpayers must be at the center of any stimulus plan.

“Instead of an unceasing focus on ‘jobs’ the government should be creating the conditions for wealth creation for long-term prosperity. Government policies should be changed to stop rewarding debt incurrence and to promote private savings and investment.

“Sadly, President Obama is taking America in a different direction. His promise last night to raise taxes on employers will delay our eventual recovery, prolonging the suffering of the unemployed and underemployed.

“I hope President Obama is serious about ending ineffective programs. We shall see. I was also heartened by his call for Universal Savings Accounts for all Americans as part of Social Security reform, but future details will have to be carefully examined.

“I salute Governor Jindal’s opposition to the large stimulus bill, and his mea culpa on behalf of the Republican Party. Republicans have a well-earned reputation for expanding deficits, bloated budgets and government largesse. The Medicare entitlement expansion, ‘No Child Left Behind’ and TARP bailout are just a few of the Republican proposals responsible for our unsustainable budget. Hopefully, as the current opposition major party, the Republicans can return to the limited government beliefs that the Libertarian Party has never abandoned. President Obama last night simply promised to carry on the Republican legacy of explosive spending and expansive welfare that not only creates a generation of dependents, but also got us into this situation to begin with.

“America is unique in its greatness and the promise it offers it citizens to live their lives as they please, so long as they do no infringe upon the rights of others. The Libertarian Party stands alone as the only party that still believes in the protecting the civil liberties Americans have fought and died to protect, as well as the entrepreneurial spirit that creates prosperity and jobs. The American people agree, and we welcome them to join their friends and neighbors here in ‘the Party of Principle.’”

FRC's Tony Perkins Responds to President Obama's Address to Congress

/PRNewswire-USNewswire/ -- Family Research Council (FRC) President Tony Perkins released the following statement in response to President Obama's address to Congress last evening:

"While the reaction to the President's speech was mixed, the reaction on Wall Street will be most telling of whether or not the President succeeded in infusing confidence into the nation's faltering economy.

"As President, it is incumbent upon Barack Obama to encourage the American people and help drive our nation's economy forward. That is, however, a difficult feat with one foot on the accelerator and the other on the brake. Despite the hopeful talk designed to nudge the nation forward, the reality of bigger and more costly government is stopping many Americans dead in their tracks on the road to economic recovery.

"The bottom line is bigger government is bigger government regardless of the patriotism that is wrapped around it. The President's pork barrel spending bills and his speech tonight reflect a philosophy that says only massive government spending will cure our economic troubles. The President's call for fiscal responsibility rings hallow when the actions that follow only pile on more massive debt and mortgage away the future of our children and their children.

"We do applaud the President for focusing on reducing the dropout rates in America, for there is little hope for those who cannot enter the workforce with the most basic of skills. However, the key is not doubling the size of the Department of Education it is in restoring parental involvement in education by allowing parents to make the fundamental decisions about their child's education, whether it be charter schools, private schools or home-schooling. All children in America should be treated equally."

Obama's 'Newer Deal' Likely to Raise Deficit

/PRNewswire-USNewswire/ -- As President Barack Obama takes office, he is promising a bold stimulus plan for the declining economy. Some of his proposals mirror those of Franklin Roosevelt's New Deal. A new report from Casey Research, "Obama's Newer Deal," examines Obama's plan in comparison to Roosevelt's and concludes that it is even more risky.

The Obama plan relies on both spending and tax cuts to raise incomes and promote recovery. The Obama administration believes people need to have money to spend in order to get the economy moving.

Casey Research's analysis shows that what is needed is a "great deleveraging: using assets to pay down debts. Like a household with finite income and too many credit cards, there comes a time when the piper has to be paid. Getting more credit cards only temporarily makes the problem go away and surely makes it all worse."

There are other key differences between the New Deal and the Obama plan. In 1933, the federal debt was $360 billion in 2008 dollars and 40% of the GDP. In 2008, the federal debt was just under $11 trillion and 70% of the GDP.

The government is likely to add $3 trillion to the national debt in 2009 alone.

"The time will come and probably in 2009," concludes Casey Research, "that the only way the U.S. will be able to fund its deficits is to create money by printing it. The Treasury will have to sell bonds, and in the absence of foreign buyers, the Fed will have to print the money to buy them. The consequence will be runaway inflation, increasing interest rates, recession, and inevitable tax increases."

"The era of runaway U.S. consumerism is over. The economy's eventual turnaround will only occur after the debt that permeates the economy is substantially reduced. It's going to be a painful process," says Casey Research.

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