This just in

Higher taxes drag down the economy; where has this story been?

  • Follow Editorials

A ton of Americans didn’t see the payroll tax increase coming. Others simply didn’t want to believe it when they heard or read about it, upon the rare occasion that the media would report on it. It had to just be right-wing talking points.

But when it hit their paychecks in January, they became believers.

“An increase in Social Security taxes is leaving Americans with less take-home pay – and a more negative outlook for the U.S. economy,” the Associated Press reported this week.

“The Conference Board said Tuesday that its Consumer Confidence Index dropped 8.1 points in January from December to a reading of 58.6, the lowest since November
2011. ...

“Conference Board economist Lynn Franco said the tax increase was the key reason confidence tumbled in January, making Americans less optimistic about the next six months.

“For a worker earning $50,000 a year, take-home pay will shrink this year by about $1,000.”

This shouldn’t have been any surprise.

For one thing, the national media could’ve done a better job warning people (as this page did). But perhaps they didn’t want to rain on President Obama’s fiscal cliff victory – although, didn’t he promise no tax increases on anyone making less than $200,000?

For another thing, the media have constantly attacked anyone preaching fiscal prudence in government. Think Tea Party. What the media should have been doing during the tax-and-spend debate of the past year is to stress to readers and viewers that the more money you take out of earners’ hands, the less money they have to spend.

That sounds simple enough. But if we’ve got that so down pat, why was the January tax increase implemented and why was it able to sneak up on so many people?

The reason that happened is also simple: The national media took Mr. Obama’s implicit message – that tax increases on the wealthy will improve the economy – and they ran with it. They let him snooker people into somehow believing that feeding the federal government behemoth is in some magical way going to improve things in the society at large. How does that work?

Instead, we’ve had another abject lesson in basic economics: If you want less of something, tax it. In this case, taxing workers means they are able to spend less, creating a drag on an already fragile economy.

A report out Wednesday indicated the economy actually shrank 0.1 percent in the fourth quarter of 2012. Again, that has now been followed by higher taxes on workers in January, which has led to a plunge in consumer confidence and, no doubt, spending.

“The surprise contraction,” says another AP article, “could raise fears about the economy’s ability to handle tax increases that took effect in January and looming spending cuts.”

Smooth move, Washington!

The payroll tax increase is supposed to go to your Social Security retirement fund. Theoretically, that’s a good thing. But in reality, there is no retirement fund: Washington has been looting Social Security for decades to pay for ongoing government spending (which your boss would be put in prison for if he or she tried that at work). So, it’s not really an investment in your future; it’s just another dollar for Washington.

And at a time when workers need every cent they can keep.

This just in: Higher taxes slow the economy.

Surprise!

Comments (31) Add comment
ADVISORY: Users are solely responsible for opinions they post here and for following agreed-upon rules of civility. Posts and comments do not reflect the views of this site. Posts and comments are automatically checked for inappropriate language, but readers might find some comments offensive or inaccurate. If you believe a comment violates our rules, click the "Flag as offensive" link below the comment.
bubbasauce
22425
Points
bubbasauce 02/01/13 - 03:24 am
11
2
You reap what you sew. This

You reap what you sew. This nation is doomed, I hate to say so. Americans keep putting these crooks back in office election after election. I really don't get it.

Riverman1
87582
Points
Riverman1 02/01/13 - 06:16 am
15
3
Obama's low information voters

Obama's low information voters don't know what payroll taxes are since most of them are not on one. And they dang sure never had to meet a payroll for employees.

my.voice
4931
Points
my.voice 02/01/13 - 07:51 am
8
2
All this talk about a "fiscal

All this talk about a "fiscal cliff" (which we went off of decades ago) allowed Obama and his thugs to sidetrack the American tax PAYER from seeing the rattlesnake laying at the door. Remember Mister Obama extended the tax cuts.....but only thru the end of the year. I mean he had to do whatever he had to in order to seal up the election.

And there wasn't any coverage of this in the government mouthpieces (CNN, FOX, NBC, ABC, CBS) either.

Fiscal cliff.......right, good one.

Rhetor
1026
Points
Rhetor 02/01/13 - 08:13 am
6
10
Are you serious?

The payroll tax (which funds SS & Medicare) was temporarily lowered only after a bruising battle against the Republicans in Congress, who didn't want to lower it. Obama campaigned like crazy to lower it. The Republicans only wanted to lower taxes for the rich. No one among the Dems had the stomach for another fight over the issue. BTW, your Tea Party caucus led the original fight not to lower the payroll tax, which you would have known if you read your own financial pages. The historical revisionism in this editorial is astonishing. Have a great day.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 09:09 am
9
4
That's right...they
Unpublished

That's right...they Republican's only want to lower the taxes on the rich.....that's what the Bush tax cuts did, right.........oh wait......that's just what the left SAID they did....until they were going to expire and the low information voters found out that they lowered taxes on ALL tax payers. Talk about revisionism. Heck......for years they were even called "the Bush Tax cuts FOR THE RICH."

effete elitist liberal
3167
Points
effete elitist liberal 02/01/13 - 09:37 am
7
10
say wha???

This piece is typical MR and ACES baloney. Here are the facts: virtually every Republican leader vigorously OPPOSED extending the 2010 temporary SS payroll tax cut after 2012. Yes, OPPOSED! That includes Romney, Boehner, and Paul Ryan. Every major Republican OPPOSED the extension, a failure which this ACES piece tries to pin on President Obama. The arguments which Republican leaders made in OPPOSING an extension of the SS payroll tax cuts included that the SS tax cut had lead to an underfunding of SS, funds which had to be borrowed, and that the SS tax cut thus simply added to the federal deficit. Why do you not read about this in this ACES piece? If you are not aware of the Republican opposition to extending the SS payroll tax holiday, I guess that just makes you another "low information voter."

Humble Angela
41338
Points
Humble Angela 02/01/13 - 09:47 am
10
5
Blame anyone but the guy who
Unpublished

Blame anyone but the guy who is supposed to be the leader.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 09:48 am
10
4
Can someone name one bad
Unpublished

Can someone name one bad thing that the President has actually accepted responsibility for? I mean according to what he will accept responsibility for, the nation should be better off than it ever has in history, since he has NEVER done anything wrong.

effete elitist liberal
3167
Points
effete elitist liberal 02/01/13 - 10:22 am
5
8
responsibility

Nice job, Humble, another one of your decisive, hard-hitting, fact-based responses. If you are not a typical "low information" voter, perhaps you can prove that my assertions were wrong. Perhaps you would enjoy proving to me and other readers that Republicans lined up to extend the SS payroll tax holiday into 2013. Prove that Paul Ryan, the idol of the far right, did not reject any extension of the payroll tax holiday, calling it
"sugar-high economics" that wouldn't promote long-term growth. To quote, well, you, "Prove it!"

dahreese
4747
Points
dahreese 02/01/13 - 10:57 am
7
5
It's a typical AC editorial,
Unpublished

It's a typical AC editorial, alright.

By-the-way, has anyone ever seen a liberal editorial cartoon in the AC?

You know, "fair and balanced" and that sort of thing?

dichotomy
34786
Points
dichotomy 02/01/13 - 11:05 am
7
3
I think the point of the

I think the point of the article is that during all of the end of year fiscal cliff Democrat "tax the rich" rhetoric, the Democrats did not say "and by the way lower middle class and middle class, you're taxes are going up too".

This just points out the fact that "tax the rich" really does nothing. Little, if any revenue will be raised from the rich. The only money in the economy that is consistently available for taxing is from the people who earn their money in a paycheck and have to immediately turn around and spend that money, i.e. the lower and middle class. The wealthy and the corporations always have the options of moving their money to tax havens, tax free bonds, and/or passing the cost of any additional taxes placed on them down to the consumers in the lower middle and middle class. The lower middle and middle class always pay the additional taxes in the cost of goods and services. They don't think about that when they are hollering "tax the rich". The "rich" did not get rich by absorbing costs and not passing them down. When you holler "tax the rich" you might as well be hollering "raise the prices of everything I buy" because that is what really happens. Think about it folks....it will eventually sink in.

And yes, I don't think either side advocated extending the payroll tax cuts. It was a stupid thing to do in the first place.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 11:11 am
7
3
Hmmmm...scrolling
Unpublished

Hmmmm...scrolling through.....looking for where I said EEL was wrong in his post.....hmmmm....can't seem to find it. Yes, Repblicans are guilty as well. Some of us are capable of accepting responsibility, AND placing blame where it belongs.......some are not.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 11:13 am
8
4
dahreese..ever seen a
Unpublished

dahreese..ever seen a conservative editorial in Huffington Post? I'm sure the AC publishes what will bring in the money. If people want a liberal editorial, they are free to look elsewhere......or are you one that believes they should be FORCED to post other viewpoints, ie the "Fairness Doctrine?"

allhans
24148
Points
allhans 02/01/13 - 11:17 am
7
3
The payroll tax should have

The payroll tax should have never been lowered in the first place. What did it accomplish other than leave our social security system in more of a financial crisis.

All the billions in stimulus that created temporary government jobs that no longer exist..It seems everything this administration has attempted has been "temporary" even the badly done payroll tax deduction...

Obama performs great before a live audience..he points, winks, grins and the crowds go crazy....They adore his stage personality, and care little about his leadership qualifications.
That is what we have come to.

ymnbde
10144
Points
ymnbde 02/01/13 - 11:21 am
5
2
the United Way

is really who Obama hurt this time. I donate to that an a few other charities about what Obama raised my taxes this year.

effete elitist liberal
3167
Points
effete elitist liberal 02/01/13 - 11:25 am
4
7
Hmmmmmm....

OK, so I am right. That means this ACES piece is fundamentally dishonest.
MR's position essentially is that the end of the SS payroll tax holiday on January 1, 2013 is Obama's fault, and at least implicitly that Republicans wanted to extend it. It is true that Obama did not push to extend the holiday, although a number of Congressional Democrats did. But it is also a fact that virtually every Republican also opposed extending it.
The simple fact is that extending the SS payroll tax holiday could never have passed in either the Democratically controlled Senate or the Republican controlled House. So yes, Humble, on this issue "Republicans are guilty as well." That of course was my point, remember?, and it was that truth that this ACES piece dishonestly left out. Readers depending on MR and ACES for more than half truths will continue to be "low information" voters.

Riverman1
87582
Points
Riverman1 02/01/13 - 11:34 am
8
3
Hey, we trademarked the term

Hey, we trademarked the term "low information voters" to describe the Democrats. Don't be stealing it.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 11:51 am
7
4
Dishonest? No....The
Unpublished

Dishonest? No....The President did say my taxes will not go up one dime. They did. He said that he wouldn't raise taxes on the middle class.....he did. He said the "Obamacare" mandate wasn't a tax...it is. Fundamentally dishonest describes the President quite well....but his acolytes NEVER seem able to call him on it. At least the conservatives will call out the Republicans when they do wrong.

dahreese
4747
Points
dahreese 02/01/13 - 11:52 am
4
3
@Humble(?) Angela
Unpublished

"...or are you one that believes they should be FORCED to post other viewpoints, ie the "Fairness Doctrine?"

Responsible, but not forced.

And I don't see that responsiblity here, nor do I seem to be the only one.

Tell me (setting aside govrnment social programs) how do you describe "conservative" and "liberal?"

Little Lamb
47283
Points
Little Lamb 02/01/13 - 11:55 am
7
2
Rhetor's Revisionism

The "payroll tax" (i.e., Social Security and Medicare taxes) was the brainchild of socialist economist Robert Reich. He once had a weekly commentary on NPR, and as soon as Obama was inaugurated in 2009, Reich started preaching the "lower the payroll tax" doctrine on the radio week after week, begging Obama to try it as a sure-fire way to stimulate the economy and create jobs. Well, four years later how is it working out for us?

The problem is that by robbing Social Security and Medicare for funds, those programs are exposed as under-funded. We have built a very elaborate and very tall house of cards, and the card table is beginning to shake underneath the house of cards. It will fall, sooner or later.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 12:23 pm
4
4
"Responsible, but not
Unpublished

"Responsible, but not forced."

Well in order to do what YOU say is responsible they would have to be forced to hire different people. Sorry mien fuhrer, but I prefer American freedom.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 12:29 pm
6
4
"Tell me (setting aside
Unpublished

"Tell me (setting aside govrnment social programs) how do you describe "conservative" and "liberal?""

In today's age, that has changed greatly. Used to be that liberals favored liberty....thus the derivation of the word, but that has changed a great deal. Liberals today prefer to have large government, in nearly every aspect of human life and interactions. They shun personal responsibility over blaming some other cause.

Conservatives, today favor freedom and liberty over big government. They prefer personal responsibility over the nanny state.

justthefacts
22997
Points
justthefacts 02/01/13 - 12:40 pm
9
2
Peanuts

You folks are arguing over peanuts.
Check this out: "In a final regulation issued Wednesday, the Internal Revenue Service (IRS) assumed that under Obamacare the cheapest health insurance plan available in 2016 for a family will cost $20,000 for the year"

Humble Angela
41338
Points
Humble Angela 02/01/13 - 12:51 pm
7
3
And yet he and his
Unpublished

And yet he and his supporters all said this would bring cost down. More lies that the uninformed voters just ate up like candy.

Riverman1
87582
Points
Riverman1 02/01/13 - 01:04 pm
6
2
It all goes back to that

It all goes back to that early video when Obamacare was being explained to the folks at the assisted living home by the Democratic Congressman and he told them it would actually save money. The old folks hooted and hollered at that. That was the first touch of realism in regards to Obamacare that the media has ignored.

dahreese
4747
Points
dahreese 02/01/13 - 01:16 pm
3
6
@Humble Angela
Unpublished

"Conservatives, today favor freedom and liberty over big government. They prefer personal responsibility over the nanny state."

Do they?

Tell me, has it been liberals or conservatives who've led the way for public education, for women's sufferage, for equal pay for women, opposed child labor, who led the way for public education, who led the way for equal rights for African-Americans?

Is it conservatives or liberals who are accusing women who have been raped as causing their own rapes (in and out of the military)?

Is it conservatives or liberals who have led the fiight for "openess" as to "why" this country is always at war (political party aside).

Is it conservatives or liberals who are leading the fight for "openess" of the internet; who are opposing illegal spying on Americans via the FBI, the CIA, Homeland Security?

Is it conservatives or liberals who have led the way for religeous freedom and pollitical freedom in this country. (It wasn't conservatives who led the American revolution, nor is the Constitution a conservative document).

The very nature of the word "conservative" does not allow a lot of lattitude for thinking outside of the box.

On the other hand, the word "liberal" allows for, and encourages, thinking and behavior outside the "established" society.

Tell me, your being a female(?), how many conservative ideas about "a woman's place" do you support, and practice?

Humble Angela
41338
Points
Humble Angela 02/01/13 - 01:22 pm
5
3
"Is it conservatives or
Unpublished

"Is it conservatives or liberals who are leading the fight for "openess" of the internet; who are opposing illegal spying on Americans via the FBI, the CIA, Homeland Security? "

Are you talking about Obama renewing the Patriot act, or his proposed drone program in the US?

"Tell me, has it been liberals or conservatives who've led the way for public education, for women's sufferage, for equal pay for women, opposed child labor, who led the way for public education, who led the way for equal rights for African-Americans? "

Well for starters, public education is an expansion of government. Not sure why you would include that.

"Is it conservatives or liberals who have led the fiight for "openess" as to "why" this country is always at war (political party aside)."

Most transparent administration ever? HAHAHAHAHAHA

"Tell me, your being a female(?), how many conservative ideas about "a woman's place" do you support, and practice?"

I don't even know what that statement is supposed to mean. And yes I'm a female.

Humble Angela
41338
Points
Humble Angela 02/01/13 - 01:44 pm
5
3
Was it a conservative that
Unpublished

Was it a conservative that came up with this liberty limiting idea in CA?

"everyone in the city of Berkeley, California should be compelled by law to drink only coffee that is organically grown. Or shade grown. Or that comes with a guarantee that coffee farmers were paid a price that made them happy."

Humble Angela
41338
Points
Humble Angela 02/01/13 - 01:46 pm
5
3
Was it a conservative that
Unpublished

Was it a conservative that put limits on the size of a soda in NYC?

Humble Angela
41338
Points
Humble Angela 02/01/13 - 01:46 pm
4
3
This sums up modern
Unpublished

This sums up modern liberalism fairly well.

http://www.youtube.com/watch?v=vkOElRDmwoU

Back to Top

Top headlines

Search of alleged dealer's home found drugs, firearms

An Augusta man who alleged sheriff's officers have used illegal steroids, some for years, came to the attention of a Richmond County Sheriff's narcotics officer twice, according to an ...
Search Augusta jobs