Raising Taxes Will Cripple An Already Fragile Economy

As I'm sure you are painfully aware, the economy is in serious trouble. Lately the stock market is in constant turmoil with more daily volatility than we've ever seen. The bond market, which drives interest rates, is going through the same type of daily turmoil. House values are still in the twilight zone and government bailouts aren't having quite the effect they were supposed to. At least in the timeframe they were supposed to. Unemployment is on the rise. Blah, blah, blah...

So why would anyone want to raise taxes in an already fragile environment? When are people going to understand that higher taxes stifle growth? In a higher tax environment, obviously many of us will pay higher taxes. But we will also pay more for the goods and services we use on a daily basis because businesses will not absorb the higher taxes they have to pay. They will simply pass the higher taxes on to their customers, us, via higher prices. A double-whammy we just can' afford.

Here is a quote that sums it up nicely. "Given current economic conditions, if Americans elect a presidential candidate who will raise taxes instead of lower them, the economy probably will not rebound by spring 2009 as it otherwise would, Steve Forbes, editor-in-chief of Forbes magazine said. Click here http://www.cnsnews.com/public/content/article.aspx?RsrcID=38138 to view the article.

So who is talking about raising taxes? No one, right? Both candidates are claiming to cut taxes. But who is telling the truth and who is omitting the truth? If you take a few minutes to read an article posted on American Thinker at http://www.americanthinker.com/2008/10/senator_obamas_four_tax_increa.html, you'll surely find out. It is a worthwhile read and I highly encourage you to take the time.

Just in case you don't have the time to read the article I will gladly summarize. On January 1, 2011 the Bush tax cuts of 2001 and 2003 are set to lapse and thus return to the level they were in 2000 if they are not renewed or made permanent. Whether you are a Bush supporter or not, you have benefited from them whether you believe it or not. The media tells you that only the rich benefited so I am providing you a link so you can see if you benefited or not. Go to http://www.moneychimp.com/features/tax_brackets.htm and input your income for any tax year you wish and then compare that to the tax you would have paid in the year 2000, which is what the tax rates will return to if they are allowed to lapse.

Senator McCain, like him or not, vows to make the Bush tax cuts permanent and even lower taxes further. Lower taxes spur economic growth. Companies can expand, which will require them to higher more people. Americans get to keep more of the money they earn, which can then be used to buy the things they want or need and, ultimately, stimulates the economy.

Senator Obama, on the other hand, vows to let the Bush tax cuts lapse, thus rasing taxes. In the American Thinker article Ned Barnett says, "Senator Obama claims that letting a tax cut lapse - allowing the rates to return to a higher level - is not actually a "tax increase." It's just a lapsing of a tax cut.

Do you see the difference?

Neither do I!"

Senator Obama gets around the raising taxes issue because technically he did not raise the taxes. The cuts simply lapsed because he chose not to renew them. He claims that 95% of Americans will get a tax cut under his plan but fails to mention that up to 40% of Americans don't pay income taxes. How do you cut taxes for someone who doesn't pay taxes? You give them money anyway, which, simply put, is WELFARE.

The bottom line is that we cannot afford a tax increase even if it is a passive increase. Obviously, there are other issues to consider and it is not my intent to turn this into a political debate. I simply want to shed some light on a very important issue facing us all as we go forward.