There's one for you, 19 for me - Macleans.ca
 

There’s one for you, 19 for me

Obama’s big government projects mean higher taxes in the future, says Mark Steyn


 

According to Mark Steyn’s latest column in the Orange Country Register, the U.S., Britain and Italy have at least two things in common when it comes to their finances: all three spent untold billions stimulating their economies and all three are the only major economies that are still in a downturn. Of the three, the U.S. has the most shameful record: “Gordon Brown and Silvio Berlusconi can’t compete with Obama’s $800-billion porkapalooza,” Steyn writes. “The president has borrowed more money to spend to less effect than anybody on the planet.” Steyn’s real fear, though, is that those stimulus dollars, along with the White House’s ambitious healthcare reforms, will burden future generations with a crippling debt load that can only be lessened through higher taxes. Americans are realizing this, Steyn argues, even if their fears seem perversely optimistic. “More and more Americans are beginning to figure out what percentage of them will wind up in ‘the richest 5 percent’ [on which the Democrats will purportedly raise taxes] before this binge is over,” he writes. “According to Gallup, nearly 70 percent of Americans now expect higher taxes under Obama.”

Orange Country Register


 
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There’s one for you, 19 for me

  1. I guess by "America needs Change", Obama meant that it literally needs your extra change, as in dimes and quarters. I have a feeling that all the Canadian politicians trying to tie themselves to Obama will regret their efforts.

    • You have a feeling?

      Well, that qualifies you to be an economist. Or maybe a psychic.

  2. You mean Obama can't fix a near trillion-dollar structural deficit and pay off enormous accumulated debt during the worst recession since the Great Depression without raising taxes?

    What a fraud!

  3. Germany and China both had massive stimulus plans as well – they recovered relatively fast. Canada's is actually larger than the of the UK, as a percentage of GDP and way larger than that of Italy. Not to mention that both the US was at the forefront of the housing collapse, with the UK tied up in it as well, far more than Canada, Japan, France or Germany were (those being the G7 countries that have recovered or seem most likely to make at least a blunted recovery this quarter).

    http://www.imf.org/external/np/pp/eng/2009/020109

    Yes, I know, it's the IMF, but interesting stats there for any interested, one which contradict Steyn's massive overgeneralizations on at least the UK and Italy.

    As for the debt load, even with the massive increases lately, the projections have the US's total federal debt at about 100% of GDP – right where it was after WW2. Yes, it's a huge concern for the country, but it's hardly an unmanagable debt load – we've had worse before, the US has had worse before, and we've all managed to deal with it in the past. The only way this becomes a crippling debt load is if Americans can't pull up their bootstraps like previous generations have done.

    • Yes, but what were the average family tax rates after WW2 before the debt reached the 100% GDP level (about 20%?)and what are they now (about 50%)? And what will they have to be to pay off this 100% GDP debt load? What is the marginal tax increase that will be needed to pay off this debt, and can the average family handle that additional percentage on their taxes?

      It's a very different time and different cirmcumstances.

  4. Yes, but what were the average family tax rates after WW2 before the debt reached the 100% GDP level (about 20%?)and what are they now (about 50%)? And what will they have to be to pay off this 100% GDP debt load? What is the marginal tax increase that will be needed to pay off this debt, and can the average family handle that additional percentage on their taxes?

    It's a very different time and different cirmcumstances.

    • Please, current average tax burden in the US is about 30% – lower, actually (note, this is the tax BURDEN, including non-income taxes). In 1950, it was considerably higher. Heck, even the lowest income bracket had a marginal tax rate of 17% back then, with the highest at 84%. In the US right now, the highest marginal income tax rate is 35%.

      Yes, it's a very different time and different circumstances – the country is, from a purely fiscal point of view, much more capable of paying off this debt. A lot of it could come from the top earners, as they're about the only group whose real wages have gone up significantly over the last decade and they're at a historically low level of taxation.

      As a last point of comparison, Canada, not 13 years ago, had a federal debt level of above 60% of its GDP. Last year, we were down around 35% – down almost 2% a year. Federal debt is always a concern, and on both sides of the border we should be pushing for intelligent ways to reduce that debt. However, this is far from a financial doomsday for Americans – provided their society can accept some sacrifices and at least a partial rejection of the "me" culture that has gripped them for the last three decades.

  5. You mean America will have to reverse the Reagan taxcuts and end the "starve the beast" attitude of the Republican Party. The horror of it all.

    Notice how Steyn so easily forgets the fiscal incompetence that preceded the Obama administration in the form of George W Bush.

    • An Inconvenient Truth.

  6. Steyn's book, America Alone, is an interesting one. I think he is on to something, but his alarmist attitudes are tiring. Taxes are not the enemy. Anybody notice how horrible American roads are? Ours can be bad, but in the US, they are unbelieveable. Why? Because Americans don't want to pay taxes to fix them. That country is so a**-backward it's unreal.