(Jim Clark) – Question: What do alcoholics, drug addicts, cheating husbands and politicians have in common? Answer: They’ll tell you anything you want to hear, any time you want to hear it.
A case in point is President Obama’s State of the Union Address. As the Associated Press said, “It was a wish list, not a to-do list”. It was an election year sword rattling aimed at energizing his base, not a serious invitation to Congress and the American people to work together to fix what’s wrong with America.
Obama demanded that wealthy Americans, whom he defined as those making over one million dollars a year, pay 30% of their income in taxes. Pollster Rasmussen reports that 52% of registered voters asked about that issue agree that 30% is a fair tax rate for the top 1%, so Obama’s rhetoric seems to have caught on.
But he didn’t say whether he wanted to increase capital gains and dividend taxes to a 30% rate . . . that’s what it would take if he wants to confiscate and redistribute the wealth of high earners . . . because that would also punish retirees and trust beneficiaries who also pay at the 15% rate on such earnings.
Why so favorable a rate? Because corporate earnings paid out as dividends have already been taxed at the full corporate rate before distribution. Obama didn’t say that he wants to tax municipal bond interest, because that would cripple local governments. He just somehow wants to hurt success and isn’t sure how to go about it.
Painting a utopia for his listeners, Obama said: “Take the money we’re no longer spending at war, use half of it to pay down our debt, and use the rest to do some nation-building right here at home.”
Sounds good, except that the Iraq and Afghanistan wars have been largely financed through borrowing, so it’s unclear where any pool of cash might appear from. A cut in defense spending might reduce the nation’s spiraling deficit some, but not if Mr. Obama immediately spends that money on other programs. Also, what happens if Iran closes the Strait of Hormuz and gasoline goes to $10.00 per gallon?
Fanning the flames of populism, Obama intoned: “We have [had] subsidized oil companies for a century. That’s long enough. It’s time to end the taxpayer giveaways to an industry that’s rarely been more profitable, and double down on clean energy industry that’s never been more promising.”
What he didn’t add is that this is the third time he has made a serious run at energy subsidies. In 2009, when Democrats owned the White House and Congress, he unsuccessfully sought $36.5 billion in oil company tax increases, but his fellow Democrats did not support him. The same invective appeared in his 2011 State of the Union address and Congress again ignored him. Now he has unassailable opposition from Republicans in the House and Senate who want to spur domestic oil and gas production and generally look askance at tax increases.
To add to his embarrassment, Obama cited Ener1 in his speech as a successful clean energy company. The following day Ener 1 filed bankruptcy.
Regarding international affairs, Obama said: “Through the power of our diplomacy, a world that was once divided about how to deal with Iran’s nuclear program now stands as one.” Yeah, maybe, except for Iran’s major oil trading partner China and its ally Russia, which vetoed United Nations sanctions against Iran.
Two days after the State of the Union address, Nevada Policy Research Institute published a video showing Obama leaving a clean energy promotion event in a motorcade of 22 fossil-fueled vehicles, a clip that was repeated on the Drudge Report.
If you’re still waiting for “hope and change” be patient. See: http://www.youtube.com/watch?feature=player_embedded&v=UDDRiGIUYQo
(Jim Clark is President of Republican Advocates and a member of the Washoe County & Nevada State GOP Central Committees. He can be reached at email@example.com.)