Did Biden Let the Truth Slip on the Tax Cut Threshold?

October 29, 2008

There was an excellent piece in the Wall Street Journal’s Opinion section today about Joe Biden’s recent gaffe when he said that the threshold in which taxpayers would get a tax cut was now $150,000. The entire campaign, Obama and Biden have been saying that anyone making under $250,000 would get a tax cut. Now for some reason, this has changed. Now the campaign is defending Biden’s remarks saying that these taxpayers would not be paying more taxes than they are not, but would not get a cut. What happened to the tax cut they have been parading? Nothing happened to it. It was and still is a farse for most of the middle class – even those earning less than $150,000.

Obama has proposed over $900 billion in new spending. I have not heard anyone refer to this in reletive terms, but the current proposed 2009 budget that President Bush submitted to congress was $3.1 trillion. Basically, Obamas new spending will increase the size of the Federal Government by 29%. That is a remarkable increase. I find it odd that people are upset that Bush let the budget grow the way he did, yet they are so strongly supporting growing it another 29%. The government is already way bigger than it should be and the budget is already way out of control. We need to decrease spending – not turbo-charge it.

Back to the taxes. How is Obama going to pay for this mammouth spending increase? Taxes, of course. Unfortunately, the rich are not rich enough. If you recall, Bill Clinton promised a middle-class tax cut in 1992, only to issue the largest tax increase in American history directly on that same middle-class in 1993.

The Wall Street Journal piece points out the following:

“We suspect what’s going on here is more than Mr. Biden’s normal gift of gaffe. As with his admission that a President Obama would quickly be tested by our enemies, the Delaware rambler was stumbling into the truth. An Obama Administration couldn’t possibly pay for a tax cut for 95% of Americans by raising taxes on a mere 5%. Those 5% don’t make enough money, or at least they won’t after they find ways to shelter more of their income when their tax rates rise.”

So, back to my original question that is the title to this post, “Did Biden Let the Truth Slip on the Tax Cut Threshold?” Most likely not. His statement was closer to the truth than what will likely happen, but it is still way higher than what will likely happen. Also, listen closely as they speak of Income Tax, but not of all of the other taxes we are likely to get his with and those we pay indirectly through our employers.

Donna Bordeaux, CPA with Calculated Moves

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