On The Road To
Socialism? We've Arrived!
By PATRICK J. BUCHANAN
| Posted Tuesday, March 03, 2009 4:20 PM PT
In his campaign and inaugural address, Barack Obama cast himself as a
moderate man seeking common ground with conservatives.
Yet his budget calls for the radical restructuring of the U.S. economy,
a sweeping redistribution of power and wealth to government and Democratic
constituencies. It is a declaration of war on the right.
The real Obama has stood up and lived up to his ranking as the most
left-wing member of the Senate.
Barack has no mandate for this. He was even behind John McCain when the
decisive event that gave him the presidency occurred — the September
collapse of Lehman Bros. and the market crash.
Republicans are under no obligation to render bipartisan support to
this statist coup d'etat. For what is going down is a leftist power grab
that is anathema to their principles and philosophy.
Where the U.S. government usually consumes 21% of gross domestic
product, this Obama budget spends 28% in 2009 and runs a deficit of $1.75
trillion, or 12.7% of GDP. That is four times the largest deficit of
George W. Bush and twice as large a share of the economy as any deficit
run since World War II.
Add that 28% of GDP spent by the U.S. government to the 12% spent by
states, counties and cities, and government will consume 40% of the
economy in 2009.
We are not "headed down the road to socialism." We are there.
Since the budget was released, word has come that the U.S. economy did
not shrink by 3.8% in the fourth quarter, but 6.2%. All the assumptions in
Obama's budget about growth in 2009 and 2010 need to be revised downward,
and the deficits revised upward. Look for the deficit for 2009 to cross $2
Who abroad is going to lend us the trillions to finance our deficits
without demanding higher interest rates on the U.S. bonds they are being
asked to hold? And if we must revert to the printing press to create the
money, what happens to the dollar?
As Americans save only a pittance and have lost — in the value of
homes, stocks, bonds and other assets — $15 trillion to $20 trillion since
2007, how can the people provide the feds with the needed money?
In his speech to Congress, Obama promised new investments in energy,
education and health care. Every kid is going to get a college degree.
We're going to find a cure for cancer.
Who is going to pay for all this? The top 2%, the filthy rich who got
all those Bush tax breaks, say Democrats. But the top 5% of income earners
already pay 60% of income taxes, while the bottom 40% pay nothing.
Those paying a federal tax rate of 35% will see it rise to near 40% and
will lose a fifth of the value of their deductions for taxes, mortgage
interest and charitable contributions.
Two-thirds of small businesses are taxed at the same rate as
individuals. Consider what this means to the owner of a restaurant and bar
in Los Angeles open from noon to midnight, where a husband and wife each
put in 80 hours a week.
At year's end, the couple find they have actually made a profit of
$500,000 that they can take home in salary. What is the
Obama-Schwarzenegger tax take on that salary? Their U.S. tax rate will
have hit 39.6%. Their California income tax will have hit 9.55%.
Medicare payroll taxes on the proprietor as both employer and salaried
employee will be $14,500. Social Security payroll taxes for the proprietor
as both employer and employee will be $13,243.
In short, U.S. and state income and payroll taxes will consume half of
all the pair earned for some 8,000 hours of work.
From that ravaged salary they must pay a state sales tax of 8.25%, gas
taxes for the 50-mile commute, and tens of thousands in property taxes on
both their restaurant and home.
And, after being pilloried by politicians for having feasted in the
Bush era, they are now told the tax deduction they get for contributing to
the church is to be cut 20%, while millions of Obama voters, who paid no
U.S. income tax at all, will be getting a tax cut — i.e., a fat little
check — in April.
Any wonder native-born Californians are fleeing the Golden Land?
Markets are not infallible. But the stock market has long been a "lead
indicator" of where the economy will be six months from now. What are the
markets, the collective decisions of millions of investors, saying?
Having fallen every month since Obama's election, with January and
February the worst two months in history, they are telling us the stimulus
package will not work, that Tim Geithner is clueless about how to save the
banks, that the Obama budget portends disaster for the republic.
The president says he is gearing up for a fight on his budget.
Good. Let's give him one.
Copyright 2008 Creators Syndicate,