the LYNCH report

The Power of Clear Insight

An Open Letter to Senator Obama…

with 9 comments

Senator Obama,

You spoke today about your plan to increase capital gains taxes from 15% to 20%. You referred to it as a “modest increase”.

Sir: most people, even most Democrats, do not consider a 33% increase in taxes “modest”.

You’ve also spoken about your intent not to raise taxes on the so-called “middle-class”.

These two statements are incompatible: over 100,000,000 Americans will be affected by your 33% tax increase (which you’ve previously said you’d ultimately raise to 28%, which would be a total tax increase of 87%). People who are relying on their retirement investments will be affected. People invested in mutual funds will be impacted. Hard working people who rely on their union-negotiated pension will be affected, since those same pensions invest in the markets.

Further, at a time when capital has retreated on a wholesale basis from the markets, threatening the entire economy and making investments by companies in job-creating growth virtually impossible, do you truly believe new barriers to capital are prudent economics?

Senator Obama, please, please reconsider this course of action. Neither the American people nor the economy can reasonably be expected to sustain a 33% tax hike, and while ideology is a fine thing in extremely small doses, now isn’t the time to impose it, regardless of how tempting control of all arms of the Legislative and Executive branches of government may make it.

Written by westcoastsuccess

November 1, 2008 at 9:22 am

9 Responses

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  1. Obama is not going to raise taxes 33%; his plan calls for repealing the Bush tax cuts, which increases the amount paid on income over $250k (family) or $200K (single) by three percent. These are the same taxes paid under Reagan.

    Diane dp

    November 1, 2008 at 9:36 am

  2. Thanks Diane.

    The article speaks to Obama’s Capital Gains tax plan, not the many other taxes the Senator has proposed.

    Turn on CNN and you’ll see Obama speak about his intent to raise Capital Gains tax 33% and referring to the increase as “modest”. This differs from his web site’s claim of a hike to capital gains from 15% to 18% (20% hike). He also has said he ultimately intends to increase the Capital Gains tax to 28% (an 87% hike) – this despite the fact tax revenue decreases as Capital Gains tax rates go up.

    westcoastsuccess

    November 1, 2008 at 9:48 am

  3. Hello.

    I like your site and wanted to know if you would be interested in exchanging blogroll links.

    Thanks in advance

    Jamie Holts

    November 1, 2008 at 10:00 am

  4. I must say this is a great article i enjoyed reading it keep the good work :)

    Jamie Holts

    November 1, 2008 at 10:14 am

  5. […] An Open Letter to Senator Obama… Senator Obama, You spoke today about your plan to increase capital gains taxes from 15% to 20%. You referred to it as a “modest increase”. Sir: most people. even most Democrats, do not consider a 33% increase in taxes “modest”. You’ve also spoken about your intent not to raise taxes on the so-called “middle-class”. These two statements are incompatible: over 100,000,000 Americans will be affected by your 33% tax increase (which you’ve previously said you’d ultimately raise to 28%, which would be a total tax increase of 87%). People who are relying on their retirement investments will be affected. People invested in mutual funds will be impacted. Hard working people who rely on their union-negotiated pension will be affected, since those same pensions invest in the markets. Further, at a time when capital has retreated on a wholesale basis from the markets, threatening the entire economy and making investments by companies in job-creating growth virtually impossible, do you truly believe new barriers to capital are prudent economics? Senator Obama, please, please reconsider this course of action. Neither the American people nor the economy can reasonably be expected to sustain a 33% tax hike, and while ideology is a fine thing in extremely small doses, now isn’t […] […]

  6. Shouldn’t it cost more to do business in America? Because after all we are America land of the free and the brave. There should be a premium to live here, to do business here. If you enjoy living here, it should be illegal for you to not have your company based here. If you want your company to enjoy the tax structure of a foreign country I say great, move it, but I also say move your family too. If you can’t support American workers with jobs then you can’t enjoy the benefits of America with the money you save by screwing America.

    http://somesanity.wordpress.com/2008/11/01/john-mccains-economic-plan/

    Vaughn

    November 1, 2008 at 10:54 am

  7. Vaughn,

    That’s a protectionist argument very typical of the far-left. The problem with it is this: if you block companies from participating in the US market, it’s the consumer who suffers – prices go up for lack of competition and everyone ends up with fewer dollars – how, exactly, does that benefit the American workers?

    The notion that making it more expensive to do business in the US will lead to more jobs is exactly backwards: it will lead to _less_ jobs.

    It’s very simple to see this in action – simply look around the world at the degree of openness of any particular country’s economy and compare that to the prosperity of its populace.

    In fact, while people like to debate the benefits of free-trade vs protectionism on ideological grounds (as you do), it’s one of the few areas economists agree: open trade benefits both trading partners. Protectionism doesn’t.

    In fact, if every country adopted your philosophy, the US should be legally prohibited from _exporting_ anything, and likewise wouldn’t be legally able to import anything. All the jobs that currently produce exported items would be lost; all the low-cost imported goods would also be lost. Net result? Fewer jobs for the people and those that have jobs have to spend more money to buy things. Smart.

    westcoastsuccess

    November 1, 2008 at 2:16 pm

  8. Obama’s definition of rich is dropping fast. I thought the original amount was $250K? During his infomercial it was dropped to $200K. Now Biden’s out there saying its $150K. Get ready people, it will be down to $50K by the time he’s in office in Jan.

    york

    November 1, 2008 at 8:04 pm

  9. Great point, york – we mention this in a subsequent article which looks at whether the highest earners carry their load of the tax burden or not – have a look at the “Latest Post” links in the right pane – it’s titled, “Obamanomics and Taxes: the “Fair” Illusion”.

    westcoastsuccess

    November 1, 2008 at 9:21 pm


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