CNN iReport

Combined Fed and State tax rates of 65% for some under Obama; definition of "rich" drops to 150k: MSM wont report it

{color:brown} Earlier this week Biden let slip a new definition of middle class leading McCain to remark: bq. +*"It's interesting how their definition of 'rich' has a way of creeping down," McCain said. "Senator Obama has made a lot of promises. First, he said people making less than $250,000 would benefit from his plan. "Then, this weekend, he announced in an ad that if you're a family making less than $200,000 you'll benefit - but yesterday right here in Pennsylvania, Senator Biden said tax relief should only go to 'middle-class people' - people making under $150,000 a year.*+ Not only did the MSM ignore Biden's comment, but they also failed to reveal the likely rates that Americans could face under Obama. This, as was noted by historian Victor Davis Hanson writing in NRO, could be 65% for Americans living in States with high state tax. As VDH remarks this is not the only major oversight by the MSM.{color}

*_SOCIALISM?_* Theeleventh-hour McCain allegations of Obama’s advocacy for a share-the-wealth socialism were generally ignored by the media, or if covered, written off as neo-McCarthyism. But there were two legitimate, but again neglected, issues. The first was the nature of the Obama tax plan. The problem was not merely upping the income tax rates on those who made $250,000 (or was it $200,000, or was it $150,000, or both, or none?) but its aggregate effect in combination with lift in the FICA ceilings on high incomes on top of existing Medicare contributions and often high state income taxes. In other words, Americans who live in high-tax, expensive states like a New York or California could in theory face collective confiscatory tax rates of 65 percent or so on much of their income. And, depending on the nature of Obama’s proposed tax exemptions, on the other end of the spectrum we might well see almost half the nation’s wage earners pay no federal income tax at all. Questions arise, but were again not explored: How wise is it to exempt one out of every two income earners from any worry over how the nation gathers its federal income tax revenue? And when credits are added to the plan, are we now essentially not cutting or raising taxes, but simply diverting wealth from those who pay into the system to those who do not? A practical effect of socialism is often defined as curbing productive incentives by ensuring the poorer need not endanger their exemptions and credits by seeking greater income; and discouraging the wealthy from seeking greater income, given that nearly two-thirds of additional wealth would be lost to taxes. Surely that discussion might have been of interest to the American people. Second, the real story was not John McCain’s characterization of such plans, but both inadvertent, and serial descriptions of them, pas and present, by Barack Obama himself. “Spreading the wealth around” gains currency when collated to past interviews in which Obam talked at length about, and in regret at, judicial impracticalities in accomplishing his own desire to redistribute income. “Tragedy” is frequent in the Obama vocabulary, but largely confined to two contexts: the tragic history of the United States (e.g., deemed analogous to that of Nazi Germany during World War II), and the tragic unwillingness or inability to use judicial means to correct economic inequality in non-democratic fashion. In this regard, remember Obama’s revealing comment that he was interested only in “fairness” in increasing capital-gains taxes, despite the bothersome fact that past moderate reductions in rates had, in fact, brought in greate revenue to government. Again, fossilized ideology trumps empiricism. +Imagine the reaction of NPR and PBS had John McCain advocated something like abolishing all capital gains taxes, or repealing incomes taxes in favor of a national retail sales tax.+ The media has succeeded in shielding Barack Obama from journalistic scrutiny. It thereby irrevocably destroyed its own reputation and forfeited the trust that generations of others had so carefully acquired. And it will never again be trusted to offer candid and nonpartisan coverage of presidential candidates. Worse still, the suicide of both print and electronic journalism has ensured that, should Barack Obama be elected president, the public will only then learn what they should have known far earlier about their commander-in-chief — but in circumstances and from sources they may well regret.