Tuesday, July 12, 2011

The waiting to tax until 2013 ploy

The new argument from Obama and liberals is that no one should worry about their pressure to raise taxes because they're not going to hike taxes until 2013.

As Bryan Preston translates,
Re-elect me to get massive job killing tax hikes when I’m a lame duck and you can’t do a thing about it. That right there is a sure-fire winner of a message. If you want to morph into Walter Mondale circa 1984.
Do you really think that the economy is going to be kicking into high gear in 2013? At the best we might hope for a couple of points shaved off the percentage of people out of work. But there is no sign that we'd be chugging along with strong economic growth 18 months from now. What would be different in our economic circumstances then? So would a tax hike that came along just as the economy started growing again really be a great idea?

Would employers want to hire people now, knowing that they faced a tax hike in a year and a half? Economists know that people make decisions based on their long-term prospects. Employers would certainly take into account such an anticipated tax hike in their present-day hiring decisions.