President Barack Obama, in his state of the union address, said:
Let me repeat: we cut taxes. We cut taxes for 95 percent of working families. We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college. As a result, millions of Americans had more to spend on gas, and food and other necessities, all of which helped businesses keep more workers. And we haven’t raised income taxes by a single dime on a single person. Not a single dime.
These are NOT tax cuts. A tax cut is when the amount you have to pay is lowered - when you get to keep more of what you earned.
These are tax credits - and are called such in all the legislation. The government collects the tax from you and then disguises their handout as some sort of giveaway you're supposed to be grateful for - but only if you happen to be in the particular group whose votes their trying to purchase.
Under the tax credit concept, the amount you owe is set and then the loving politicians who just want to take care of you graciously allow you to deduct from the amount certain dollars as a reward for the behavior they want to encourage.
How magnanimous of them!
The Wall Street Journal recognized this during the 2008 campaign:
But how does he conjure this miracle, especially since more than a third of all Americans already pay no income taxes at all? There are several sleights of hand, but the most creative is to redefine the meaning of "tax cut."
For the Obama Democrats, a tax cut is no longer letting you keep more of what you earn. In their lexicon, a tax cut includes tens of billions of dollars in government handouts that are disguised by the phrase "tax credit."(emphasis added)
If they'd actually cut taxes, you'd have more money to spend on the things you want rather than the things they want. If it was a true tax cut, it wouldn't matter how you spent the extra money, but with a 'credit' you're just following their dictates on how you should spend your limited dollars.
Then there is the little twist in the statement that few actually catch. Obama says he did this for "95% of working families." Here's the twist: 95% were eligible. He has no idea if 95% actually were able to take advantage of the credits because most of them haven't filed their taxes yet!
The only way the government will know how many families got their so-called 'tax cut' is when they analyze the tax returns to see the actual number who list the credits on their forms.
I'm pretty certain that 95% of those eligible didn't take advantage of all three 'cuts' he mentioned. In fact, I'd wager that less than 50% of 'working families' took advantage of the first-time home buyer credit - maybe even less than 25% because most people in that category already are in homes.
This is just another lie presented in the worst of ways to make you think you've gotten something you really haven't.
The problem is, though, that most people won't make the distinction between tax 'cut' and tax 'credit' and will never know the truth.
7 comments:
Once upon a time in America, words used to mean things. Today however, things like tax cuts, budget savings, and jobs created or saved have meanings more slippery than the tongues of the politicians who utter them.
The greatest shame of all however, is how the meanings of liberty and Constitution seem to have slipped from the popular lexicon for many of our leaders.
Well, I just figured my taxes. Since the "federal tax credit" lowered my withholding last year, I have been underwithheld 30%. Some tax cut. I owe almost $1000,AND I CLAIMED ZERO. What is the point of giving something when you're going to take it all back.
Interesting semantic argument. I see your point in some regards. Particularly in the instance of, say, tax credits to buy a hybrid car. Since that behavior is so particular and narrow I couldn't call that a "tax cut" or (my term) a "selective tax cut" regardless of how much it reduces a person's tax burden.
But if the tax credit does not necessarily change behavior--like the credit for people paying college tuition (the same number would have been doing it with or without the tax credit) and paying college tuition is not a particularly narrow thing to do, then I would be ok calling it at the very least a "selective tax cut."
If all these credits reduce the overall citizen tax burden, with no accompanying tax increases, I'm fine saying that it is a tax cut overall. I don't think that the accounting mechanism (it's a cut to the base burden in contrast to a credit later granted with no affect to the underlying burden) is enough to make a huge deal about.
On this note, Ohio's system where local property taxes are subsidized by income taxes has been called a "tax cut" for years.
That most certainly is not a tax cut.
Kadim said:
"On this note, Ohio's system where local property taxes are subsidized by income taxes has been called a "tax cut" for years.
That most certainly is not a tax cut."
AGREED!!!!
Kadim - I understand your logic but my point about not reaching the 95% would still be valid. I'm fairly certain that giving a credit for college tuition wouldn't apply to 95% of 'working families.'
So even if we want to twist the language to say that the combined credits have decreased the 'overall tax burden,' I still doubt if that would apply to even 50% much less 95% of whatever the President defines as a 'working family.'
We certainly fall below his $250,000 threshhold he identified during his campaign and yet we're not eligible for any of those credits. I'm confident others find themselves in the same boat.
So....
Point taken.
By the way, I was curious if you were going to say anything about the Blade's editorial about the Oregon vote for issues 66 and 67.
Kadim - how 'bout 'it's sooo wrong on soooo many levels I don't know where to begin'????
I might do a post on it yet this weekend - I've been a bit busy this past week and there are lots of things I've wanted to write about...
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