It’s
rather amusing watching the liberal
media launch a full-scale attack on
George Stephanopoulos and Charles
Gibson, with General Tom Shales of the Washington
Post leading the charge. ABC’s
Stephanopoulos and Gibson
had the audacity to ask Obama
some tough questions during the
Democratic debate Tuesday night.
Challenge
Obama with well-informed questions on
tax policy and politics? Wound the media
favorite? How dare they?
The fallout is fascinating. With members
of the mainstream liberal media lunging
at each others throats, it’s kind of
like watching Hillary and Obama go at
it.
But here’s the deal: During the
debate, Obama bungled his answers on tax
policy, big time. Period. End of
sentence. End of story. To my liberal
friends in the media, all I can say is:
Get over it. Your guy has a very poor
grasp of basic economic principles.
First off, you don’t raise taxes
during a recession. That’s a
no-brainer. Second, doubling the
capital-gains tax rate will affect
Americans up and down the income ladder,
not just rich hedge-fund managers. In
addition, capital-gains tax cuts are
self-financing, and they stimulate jobs
and the economy. You want to raise
budget revenues and spark economic
growth? Cut
the cap-gains tax rate. That’s what
history shows.
The Wall Street Journal’s
Steve Moore points out that in 2005,
almost half of all tax returns reporting
capital gains came from households with
incomes under $50,000, while more than
three-quarters came from households
earning less than $100,000.
Obama also proposed uncapping the
payroll tax,
another blunder that will hit
people up and down the income ladder.
While Obama pledges tax hikes only for
folks earning more that $200,000 a year,
his tax hike on payrolls would actually
slam middle-income earners. The cap on
wages subject to the payroll tax is
presently $102,000. By eliminating that
cap Obama will be soaking veteran
firemen, cops, teachers, and
health-service workers, along with a
variety of other occupations.
In fact, in America’s largest cities,
a firefighter married to a school
teacher can earn close to $200,000
filing jointly. So not only will each
spouse separately pay more for Social
Security and health care under Obama’s
plan, together they’ll also be slammed
by Obama’s cap-gains tax increase.
This is more than just a failure to
understand the Laffer curve. It’s
another cultural misstep by Obama. I
can’t help but wonder if the senator knows
any cops or firemen. His appeal is to
well-educated latte liberals. That
remark about middle-income folks having
turned to God, faith, and guns because
of economic setbacks? Not only was it
ill-advised, it illustrates the wide
cultural chasm that exists between the
candidate and the rest of America.
In effect, Obama’s economics are bad
and his social circle is very limited.
This is one of the many reasons why a
quarter of the Hillary Democrats are
telling pollsters they’ll likely move
to John McCain in the general election.
Obama’s
real agenda is far-liberal
left. It’s an ideology that places
income redistribution above economic
growth. That’s his real message. And
it’s the same one that sunk Carter,
Mondale, Dukakis, Gore, and Kerry. Bill
Clinton? He was a growth Democrat. So he
won twice. But Obama is aligning himself
with the Democratic losers. And that
will make him a loser as well.
The Gallup poll taken after the
Democratic debate reveals that
Hillary’s pit-bull routine may have
worked. We’ll learn more on that front
come Tuesday when Pennsylvanians head to
the voting booths. But that’s a
different issue. What I’m saying is
that liberals need to quit blaming
Charlie Gibson and George Stephanopoulos
for Obama’s shortcomings. Instead,
they need
to blame Obama for failing to grasp
how tax penalties on upward mobility
will hurt the very people he thinks
he’s going to help.
Jack Kemp has effectively made
the point that African American
communities desperately need capital in
order to create new businesses and jobs.
Yet as Obama takes the capital out of
capitalism, all those who are not rich
will be hurt when the rich folks with
capital have less of it — after tax
— to invest in those new businesses
and new jobs.
That’s exactly why
wealth-redistribution plans always
backfire. Robbing Peter to pay Paul is a
surefire economic loser. So is putting
government in charge of the economy,
which is what Mr. Obama is
proselytizing.
This marks the third mistake for the
Illinois senator. Not only does he not
understand economics; not only is he set
apart from middle-class values and
beliefs; he apparently hasn’t read
much history either.
Did someone say inexperience?
— Larry
Kudlow, NRO’s Economics Editor, is
host of CNBC’s Kudlow
& Company and author of
the daily web blog, Kudlow’s
Money Politic$.
