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Is there an Obama tax Increase in your future?

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wasteful View Drop Down
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    Posted: Aug 02 2009 at 1:05pm
Probably.

Geithner Won’t Rule Out New Taxes for Middle Class

August 02, 2009 8:02 AM

abc News
 
To get the economy back on track, will President Barack Obama have to break his pledge not to raise taxes on 95 percent of Americans? In a “This Week” exclusive, Treasury Secretary Tim Geithner told me, "We’re going to have to do what’s necessary.”

Geithner was clear that he believes a key component of economic recovery is deficit reduction. When I gave him several opportunities to rule out a middle class tax hike, he wouldn’t do it.

“We have to bring these deficits down very dramatically,” Geithner told me. “And that’s going to require some very hard choices.”

“We will not get this economy back on track, recovery will be not strong and sustained, unless we convince the American people that we are going to have the will to bring these deficits down once recovery is firmly established,” he said.

While Geithner told me, “There are signs the recession is easing,” he warned that, “We have a ways to go.”

“I want to emphasize the basic reality that unemployment is very high in this country,” the secretary said. But, he underlined that the administration is “going to do what is necessary to bring growth back on track.”

Turning to the bank bailout, he told me it is “quite unlikely” that the U.S. Treasury will go back to Congress to ask for more funding for the financial rescue package.

"We do not plan to ask for more money and I think it’s quite unlikely that we do," Geithner said in his most blunt language to date on TARP funding. The secretary said that today the TARP has roughly $130 billion, in part due to more than $70 billion that has already come back into the government.

Geithner also strongly endorsed legislation currently pending in the House that would increase the power of the SEC and give shareholders more rights to vote on executive compensation. He insisted that Republican criticism that the government is overly involved in the financial system is unfounded.

"Everybody understands that we cannot have our financial system go back to the practices that brought this economy to the brink of collapse," he told me. "It is going to take fundamental reform."

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Vivian Moon View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Vivian Moon Quote  Post ReplyReply Direct Link To This Post Posted: Aug 02 2009 at 5:38pm

Now is the time for all Americans to let their wallets do the talking.
Look at the labels before you purchase items large and small.
BUY FROM LOCAL STORES
BUY WHAT IS MADE IN
USA

PUT AMERICANS BACK TO WORK

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Hermes View Drop Down
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Post Options Post Options   Thanks (0) Thanks(0)   Quote Hermes Quote  Post ReplyReply Direct Link To This Post Posted: Aug 02 2009 at 9:22pm
I'm with you on that statement Vivian !!  Clap
 
A tax hike is enevitable. You can not continue the way they  are and not expect taxes to raise. They are spending untold $billions on two active police actions. If they expect to continue perpetual actions then someone has to pay for it.
 
 
No more democrats no more republicans,vote Constitution Party !!
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Post Options Post Options   Thanks (0) Thanks(0)   Quote wasteful Quote  Post ReplyReply Direct Link To This Post Posted: Aug 03 2009 at 4:34pm

AP ENTERPRISE: Biggest tax revenue drop since 1932

By STEPHEN OHLEMACHER, Associated Press Writer Stephen Ohlemacher, Associated Press Writer 6 mins ago

WASHINGTON – The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation's plate and struggling to find money to pay the tab.

The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.

Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever.

The last time the government's revenues were this bleak, the year was 1932 in the midst of the Depression.

"Our tax system is already inadequate to support the promises our government has made," said Eugene Steuerle, a former Treasury Department official in the Reagan administration who is now vice president of the Peter G. Peterson Foundation.

"This just adds to the problem."

While much of Washington is focused on how to pay for new programs such as overhauling health care — at a cost of $1 trillion over the next decade — existing programs are feeling the pinch, too.

Social Security is in danger of running out of money earlier than the government projected just a few month ago. Highway, mass transit and airport projects are at risk because fuel and industry taxes are declining.

The national debt already exceeds $11 trillion. And bills just completed by the House would boost domestic agencies' spending by 11 percent in 2010 and military spending by 4 percent.

For this report, the AP analyzed annual tax receipts dating back to the inception of the federal income tax in 1913. Tax receipts for the 2009 budget year were available through June. They were compared to the same period last year. The budget year runs from October to September, meaning there will be three more months of receipts this year.

Is there a way out of the financial mess?

A key factor is the economy's health. The future of current programs — not to mention the new ones Obama is proposing — will depend largely on how fast the economy recovers from the recession, said William Gale, co-director of the Tax Policy Center.

"The numbers for 2009 are striking, head-snapping. But what really matters is what happens next," he said. "If it's just one year, then it's a remarkable thing, but it's totally manageable. If the economy doesn't recover soon, it doesn't matter what your social, economic and political agenda is. There's not going to be any revenue to pay for it."

A small part of the drop in tax receipts can be attributed to new tax credits for individuals and corporations enacted in February as part of the $787 billion economic stimulus package. The sheer magnitude of the tax decline, however, points to the deep recession that is reducing incomes, wiping out corporate profits and straining government programs.

Social Security tax receipts are down less than a percentage point from last year, but in May the government had been projecting a slight increase. At the time, the government's best estimate was that Social Security would start to pay out more money than it receives in taxes in 2016, and that the fund would be depleted in 2037 unless changes are enacted.

Some experts think the sour economy has made those numbers outdated.

"You could easily move that number up three or four years, then you're talking about 2013, and that's not very far off," said Kent Smetters, associate professor of insurance and risk management at the University of Pennsylvania.

The government's projections included best- and worst-case scenarios. Under the worst, Social Security would start to pay out more money than it received in taxes in 2013, and the fund would be depleted in 2029.

The fund's trustees are still confident the solvency dates are within the range of the worst-case scenario, said Jason Fichtner, the Social Security Administration's acting deputy commissioner.

"We're not outside our boundaries yet," Fichtner said. "As the recovery comes, we'll see how that plays out."

The recession's toll on Social Security makes it even more urgent for Congress to address the fund's long-term solvency, said Sen. Herb Kohl, D-Wis., chairman of the Senate Aging Committee.

"Over the past year, millions of older Americans have watched their retirement savings crumble, making the guaranteed income of Social Security more important than ever," Kohl said.

President Barack Obama has said he wants to tackle Social Security next year, after he clears an already crowded agenda that includes overhauling health care, addressing climate change and imposing new regulations on financial companies.

Medicare tax receipts are also down less than a percentage point for the year, pretty close to government projections. Medicare started paying out more money than it received last year.

Meanwhile, the recession is taking a toll on fuel and industry excise taxes that pay for highway, mass transit and airport projects. Fuel taxes that support road construction and mass transit projects are on pace to fall for the second straight year. Receipts from taxes on jet fuel and airline tickets are also dropping, meaning Congress will have to borrow more money to fund airport projects and the Federal Aviation Administration.

Last week, Congress voted to spend $7 billion to replenish the highway fund, which would otherwise run out of money in August. Congress spent $8 billion to replenish the fund last year.

Rep. Richard Neal, D-Mass., chairman of the House subcommittee that oversees fuel taxes, is working on a package to make the fund more self-sufficient. The U.S. Chamber of Commerce, which doesn't back many tax increases, supports increasing the federal gasoline tax, currently 18.4 cents per gallon.

Neal said he hasn't endorsed a specific plan. But, he added, "You can't keep going back to the general fund."

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Post Options Post Options   Thanks (0) Thanks(0)   Quote wasteful Quote  Post ReplyReply Direct Link To This Post Posted: Aug 03 2009 at 4:37pm

White House Says No New Taxes for Middle Class

The White House dismisses as "hypothetical back and forth" suggestions by top economic advisers that middle-class families could see a tax hike.  

FOXNews.com

Monday, August 03, 2009

President Obama is committed to making sure middle class families do not see a tax increase, White House Press Secretary Robert Gibbs said Monday, one day after two top economic officials seemed to leave the door open to a tax hike. 

"The president's clear commitment is not to raise taxes on those making less than $250,000 a year," Gibbs said, repeating Obama's pledge from the presidential campaign. 

On Sunday, Treasury Secretary Tim Geithner suggested that taxes increases are inevitable. 

"We will not get this economy back on track, recovery will be not strong and sustained, unless we ... can convince the American people that we're going to have the will to bring these deficits down once recovery is firmly established," Geithner said on ABC's "This Week." 

Asked point blank whether it was right to suggest it is a matter of when, not if, taxes will be raised, Geithner responded, "It is absolutely right." 

National Economic Council President Larry Summers also did not rule out future increases on CBS' "Face the Nation." 

YOU DECIDE: Would You Pay Higher Taxes to Fund Health Care Reform?

Gibbs, though, dismissed the comments Monday as part of a "hypothetical back and forth" that Geithner and Summers allowed themselves to engage in. 

"Promising that everybody's going to be on message may be a bar that's too high for me to leap over," Gibbs said.

Peppered with reporters' questions on the topic, he repeatedly said that despite the Sunday comments the president has been "clear" that he intends to shield middle-class families from a tax hike. 

"I am reiterating the president's clear commitment in the clearest terms possible that he's not raising taxes on those who make less than $250,000 a year," he said. 

But some Republicans say Obama already has broken his pledge not to raise taxes on the middle class. 

Republicans on the tax-writing House Ways and Means Committee on Monday released a list of six programs and proposals they claim would raise taxes on the middle class -- including the tobacco tax hike and proposals to include coverage mandates in health care reform legislation. 

"After only six months as president, (Obama) and congressional Democrats have repeatedly violated this pledge" not to raise taxes on middle-class families, Republicans said in a memo.

The discussion over future tax increases comes as the deficit is expected to hit $1.8 trillion next year. With spending still planned for a $1 trillion, 10-year health care reform plan, officials say something will have to be done to keep the deficit and national debt from growing wider. 

Gibbs said Obama is committed to cutting wasteful spending to help achieve that goal. 

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