Video Of Obama Stating He Will Veto Any Effort Stop His Sequester
Obama has spent the last several weeks campaigning for higher taxes and painting a picture of economic Armageddon if he doesn’t get his way—food shortages, massive airline flight cancelations, and the like — and civil disorder — fewer police on the streets and cutbacks in border security.
Video of Obama stating that he will veto any bill against his sequester
The Budget Act of 2011 limits President Obama’s ability to allocate the cuts among departments. However, House Republicans have offered to draft legislation giving him discretion in where he trims the $40 billion, but the President has indicated no interest in such a deal.
Obama got $150 billion in new taxes in January and under current legislation Federal tax revenues will rise well above their average for the last forty years. Moreover, health care, social security, and federal pension spending—which are driving the deficits ever higher—are rising much faster than GDP.
The Congressional Budget Office estimates that although federal budget authorization will be cut $85 billion, actual spending will be sliced only $44 billion for the fiscal year ending in September.
Furloughed federal employees and contractors will spend less at gas stations and the mall, and considering in this multiplier effect, overall demand for goods and services will decrease about $80 billion or less than one half of one percent of GDP.
According to the White House, the sequester will mean up to 2,100 fewer food inspections, 373,000 mentally ill adults and children going without treatment, 70,000 kids being kicked out of preschool, 2,700 schools losing federal funding, about 30,000 teacher layoffs, a reduction in federal law enforcement capacity equivalent to the loss of 1,000 federal agents, 1,000 fewer criminal prosecutions, and the list goes on and on.
Tax increases the fiscal cliff deal allowed:
1. Payroll tax: increase in the Social Security portion of the payroll tax from 4.2 percent to 6.2 percent for workers. This hits all Americans earning a paycheck — not just the “wealthy.” For example, The Wall Street Journal calculated that the “typical U.S. family earning $50,000 a year” will lose “an annual income boost of $1,000.”
2. Top marginal tax rate: increase from 35 percent to 39.6 percent for taxable incomes over $450,000 ($400,000 for single filers).
3. Phase out of personal exemptions for adjusted gross income (AGI) over $300,000 ($250,000 for single filers).
4. Phase down of itemized deductions for AGI over $300,000 ($250,000 for single filers).
5. Tax rates on investment: increase in the rate on dividends and capital gains from 15 percent to 20 percent for taxable incomes over $450,000 ($400,000 for single filers).
6. Death tax: increase in the rate (on estates larger than $5 million) from 35 percent to 40 percent.
7. Taxes on business investment: expiration of full expensing — the immediate deduction of capital purchases by businesses.
Health-care tax increases that took effect:
8. Another investment tax increase: 3.8 percent surtax on investment income for taxpayers with taxable income exceeding $250,000 ($200,000 for singles).
9. Another payroll tax hike: 0.9 percent increase in the Hospital Insurance portion of the payroll tax for incomes over $250,000 ($200,000 for single filers).
10. Medical device tax: 2.3 percent excise tax paid by medical device manufacturers and importers on all their sales.
11. Reducing the income tax deduction for individuals’ medical expenses.
12. Elimination of the corporate income tax deduction for expenses related to the Medicare Part D subsidy.
13. Limitation of the corporate income tax deduction for compensation that health insurance companies pay to their executives.