FIRST PRESIDENTIAL DEBATE – Barack Obama VS Mitt Romney (Part 3)

Published on Oct 3, 2012 by LearnTVMore

Setting the record straight on the first presidential debate is very easy if you are a reader of the Heritage Foundation website!!! Here are some examples below taken from Romina Boccia‘s excellent article from October 4, 2012:

During last night’s presidential debate, claims were flying fast and furious. Some of these claims were true, others false. Here are the top 10—see which ones you can guess as either true or false.

4.      Romney would cut taxes by $5 trillion.

Obama: “Governor Romney’s central economic plan calls for a $5 trillion tax cut.”

False.Governor Romney’s tax plan doesn’t cut taxes. His plan is revenue neutral.

5.      Dodd–Frank promises to bail out “too-big-to-fail” firms.

Romney: “Dodd–Frank was passed. And it includes within it a number of provisions that I think has some unintended consequences that are harmful to the economy. One is it designates a number of banks as too big to fail, and they’re effectively guaranteed by the federal government.”

True.Dodd–Frank contains language that would make future bailouts of “too big to fail” firms inevitable, but it does nothing of consequence to reduce systemic risk.

6.      The oil industry receives $4 billion in corporate welfare that other businesses don’t get.

Obama: “The oil industry gets $4 billion a year in corporate welfare. Basically, they get deductions that those small businesses that Governor Romney refers to, they don’t get.”

False.A large part of that $4 billion figure comes from a broadly available tax provision and expensing options. These are neither subsidies nor corporate welfare. The tax deduction, under Internal Revenue Code Section 199, goes to all domestic manufacturing. Producers of clothing, roads, electricity, water, renewable energy projects, and many other things produced in the United States are eligible for the manufacturer’s tax deduction—including Hollywood movies.

FIRST PRESIDENTIAL DEBATE – Barack Obama VS Mitt Romney (Part 4)

Published on Oct 3, 2012 by LearnTVMore

Here is what the Heritage Foundation Scholars had to say:

Stop the Spending

Both President Obama and Governor Romney discussed spending and budget deficits. Washington is currently spending around 23 percent of the economy (GDP), well above the historical average of about 20 percent of GDP. While revenues are temporarily low due to the recession and the sluggish recovery that has ensued, they will return to and indeed surpass their historical level of 18.1 percent once the economy recovers and Americans are back to work. Washington clearly has a spending problem. What the country needs is leadership that demands an end to the current irresponsible spending. This will curb budget deficits and rising debt that are threatening the economy. Americans are eager for solutions that get at the root of the problem: spending.

– Emily Goff

Spending and Debt

The President’s response to the spending and debt crisis is revealed by what he does, not by what he says. In the fourth consecutive year of deficits exceeding $1 trillion, the President’s budget for fiscal year (FY) 2013 continued a practice of relentlessly higher spending. As analyzed by the non-partisan Congressional Budget Office (CBO), spending in the President’s budget was $1.15 trillion higher over 2013-2022. Roughly half of the increase came from policy changes, and the other half from increased interest payments due to chronic deficit spending. The President’s record total spending would remain higher than 22 percent of gross domestic product (GDP) throughout the decade, “well above the 21.0 percent average seen over the past 40 years,” CBO says.

The combination of policies in the President’s budget produces cumulative deficits of $6.4 trillion through 2022, $3.5 trillion more than CBO’s baseline – sharply different from the more than $5 trillion in deficit reduction the President’s budget claimed. Yet the President’s sole response to this crisis is to raise taxes. He ignored the recommendations of his own deficit reduction panel, the Bowles-Simpson Commission, and has offered no plan to reverse the devastating across the board spending cuts scheduled to start in January—instead insisting that Congress must find an answer. Congress does indeed need to respond—but so does the President.

– Patrick Louis Knudsen

Key Tax Points and Obama Falsehoods

President Obama and Governor Romney had a long back-and-forth on taxes to open the debate. They touched on two important tax topics vital to the future of the economy.

Most of the time was spent on Governor Romney’s tax plan. Romney’s plan, like most tax reform plans, would lower tax rates and make other changes to the tax code to encourage growth. The economy will not recover fully until we have tax reform.

President Obama repeated the falsehood that Romney’s plan would raise taxes on the middle class. This incorrect assertion was spread by a biased report from the Tax Policy Center. Romney’s plan can make pro-growth changes to the tax code and doesn’t have to raise taxes on the middle class.

Less time was spent on another important topic: the corporate income tax. The U.S. now has the highest corporate tax rate in the developed world, and we remain one of the only countries that taxes our businesses on the income they earn in foreign countries. We will continue to lose jobs to more competitive countries until we bring that high rate down from 35 percent to meet or fall below the 25 percent average in countries we compete with for new investment.

Some time was also spent on President Obama’s plan to raise the top marginal tax rate over 40 percent. It is important to keep in mind that raising the top rate would fall heavily on job creators and hurt job creation.

President Obama falsely claimed businesses can take a deduction for moving jobs overseas. No such deduction exists.

– Curtis Dubay

What Is Obama’s Tax Reform Plan?

President Obama has roundly criticized Governor Romney’s tax reform plan, but where’s the President’s plan? All President Obama has proposed is to raise taxes on those who run small businesses and hire workers, who are highly productive citizens and good investors.  Otherwise, Obama’s proposals as detailed in his budget are little more than a cattlecall of housecleaning tweaks.  This is especially astounding when one recalls that Governor Romney has no mighty engine of tax expertise at his beck and call, whereas the President has the Treasury Department, the National Economic Counsel, the Council of Economic Advisors, and many more able bodies on the government’s payroll eager to do his bidding.

With so much talent available to him, and yet no proposal for fundamental tax reform whatsoever, one can only presume President Obama is fundamentally content with the current individual income tax system.

– J.D. Foster

Tax Cuts vs. Tax Increases

President Obama mentioned how the middle class has benefited from his tax policies, for example from the extension of the Bush-era tax rates. How ironic, then, that the President’s own budget proposal for FY 2013 would raise taxes by $2 trillion. Oh, and then there’s Taxmageddon, which Congress and this President have yet to solve, despite warnings far and wide. All of that hardly adds up to responsible tax policy.

– Emily Goff

Obama on Romney’s Tax Reform

President Obama has utterly and consistently dissembled regarding Governor Romney’s tax reform plan. Contrary to Obama’s assertions, repeated unquestioningly in the mainstream media, the Romney plan is to cut individual income tax rates 20 percent, for tax reform to be revenue neutral, neither raising nor lower revenues in the aggregate, and for tax reform to be distributionally neutral, neither raising taxes on the middle class nor cutting them for upper earners. Analysis to the contrary by some outlets is simple misinformation, intentional or otherwise.

To be sure, it will be difficult to cut individual income tax rates the full 20 percent as Governor Romney proposes and still meet the criteria of revenue and distributional neutrality. Guess what? Tax reform will be terribly difficult no matter how it is pursued.  Setting an ambitious goal is an essential step even to start the effort. Perhaps once the debate is fully underway, the nation will find cutting rates 20 percent is just too much, or perhaps the nation will find the exercise so liberating, and the prospects of a simpler tax system and a stronger economy so enticing, that 20 percent reductions are seen as too cautious. The point is, the current tax system needs replacing, and Romney has proposed a strong start. In contrast, President Obama has proposed higher tax rates.

– J.D. Foster

Tax Increases and the Economy

President Obama has long insisted on higher taxes for small businesses, investors, and upper-income earners.  Apparently, it does not matter to him that this can only harm the economy, which has sputtered badly under his management. Apparently, it does not matter to the President that these individuals already pay a stunning share of the federal income tax burden.  Apparently, it does not matter to Obama that these tax hikes would at most be a drop in the bucket toward reducing the budget deficit.  All that matters to him, apparently, is that these taxpayers be punished with higher taxes for the transgression of earning a higher income.  It should surprise no one, then, that a President so antagonistic to the forces of economic growth has managed to achieve so little of it.

– J.D. Foster

Government Spending

Time and time again, Americans have heard from President Obama and others in Washington that government investments—read: massive amounts of spending—will create the jobs Americans need. Time and time again they have been wrong. President Obama tonight dusted off that claim and called for even more government spending. It’s exactly the wrong prescription.

Government stimulus spending does not help the economy grow or “create” jobs, beyond perhaps a localized effect here and there. To make matters worse, Americans should be concerned about the fact that this spending has to be paid for, either through higher taxes or increased borrowing or both, which threaten to harm the economy further.

The private sector does a much better job than the federal government at creating jobs when and where there is demand for them. Try laying off on the anti-business regulatory onslaught from the National Labor Relations Board, the EPA, and others that is costing businesses millions of dollars. Try fixing Taxmageddon now to give businesses the certainty about their tax rates next year that they need to make hiring decisions today. Do those things and you just might see the economy take off.

– Emily Goff

Related posts: