Tag Archives: Obama Administration

Chris Banescu “The Assault on American Business”

The message from Washington is clear and getting louder by the day. If you run a successful business you face excessive government regulations and higher levels of taxation for years to come. The more productive and profitable you become, the more you will be forced to pay for the privilege of operating in this country. This threat is real and it appears that many companies and business owners are taking steps to protect themselves.

President Obama’s anti-business and anti-competitive campaign messages made executives and business owners apprehensive ahead of the January 2009 presidential inauguration and the Democrats obtaining control of Congress. Coming in the midst of one of the worst financial crisis and economic recessions in recent memory these promises had predictable results: businesses aggressively cut expenses, decreased their capital expenditures, drastically reduced their payrolls, and hunkered down to weather the current crisis and deal with the long-term consequences of punitive government actions.

What are the messages that businesses have been receiving from Obama and a vast majority of the Democrats in Washington even before the November 2008 elections?

  • We will raise your income taxes.
  • We will raise your capital gains and dividends taxes.
  • We will increase regulations and impose further restrictions on your economic activities and personal freedoms.
  • We will take over the private heath care system, dictate coverage and prices, and add a permanent surtax on upper-income individuals and businesses to pay for it all.
  • We will tax your carbon dioxide emissions and force you to justify your energy consumption.
  • We will dramatically increase energy and raw material prices via a convoluted and oppressive cap and trade tax and regulate scheme.
  • We will radically expand government deficit spending and bureaucracy.
  • We will add trillions of dollars to the national debt and virtually guarantee very high inflation, drastic weakening of the US dollar, diminished prospects of new jobs creation, and reduced economic activity for the foreseeable future.

Five Threats

There are at least five different specific promises and initiatives from the current administration that threaten the future competitiveness and success of American businesses and the prosperity of individuals who dare to succeed and earn more. These combined threats have played an important part in further depressing economic activity in the US and signaling to all company owners to remain defensive and cautious in the face of a business unfriendly political environment at least through the end of Obama’s term (only one, we hope) in office.

Threat #1 – Higher Income Taxes
Beginning with 2011 the Obama administration promises to raise income taxes on married couples earning more than $250,000/year and singles earning more than $200,000/year. This would mean that the two highest federal income tax rates will rise from 33% and 35%, to 36% and 39.6%, respectively. Furthermore, the White House seeks to phase out the personal exemptions and limit deductions allowed for these taxpayers. Many businesses are usually started and run by families and individuals with gross incomes in those ranges. This guaranteed 9% to 13% tax increase (likely much higher due to tax exemptions limits and planned healthcare surtaxes) on their yearly incomes will reduce cash flowing into the economy (via investments or purchases) and seriously hinder economic growth.

Threat #2 – Higher Capital Gains Taxes
President Obama also pledged to raise capital gains and dividends taxes from the current 15% to 20% starting in 2011. This represents a 33% tax increase on all businesses and individuals who realize a capital gain on the sale of stock, real estate, or other assets, and those that receive qualified dividends from stocks in their personal portfolios, retirement accounts, or pension funds. This enormous tax increase will punish not only the highest income earners, but all hard-working taxpayers and retirees.

Threat #3 – Government-Run Health Care/Socialized Medicine
The current administration is actively working to create a government-run health care system that will cost approximately $1.6 trillion over 10 years, as reported by the Congressional Budget Office, and will only remove “16 million from the 46 million uninsured.”

The Wall Street Journal reports that House Democrats want to implement a package of surtaxes from 1% to 3% on all families making $350,000 or more in order to raise an additional $540 billion in taxes over the next decade. So any small to medium-sized business earning at least $250,000 or more will see its tax rate increase from 35% now, to 39.6% to 42.6% come 2011, and possibly as high as 44.6% in 2013 when these health-care surtax rates are scheduled to rise to 2-5%. These business owners can now look forward to a massive 13.1% to 27.4% tax increase on their earnings.

Furthermore, Investor’s Business Daily details that the latest Senate version of this plan would include “a $750-per-worker ‘annual fee,’ $375 for part-time workers on companies with more than 25 employees that do not offer coverage to employees.” This represents yet another additional tax on small businesses. As the IBD article correctly points out, “if you’re a small business seeking to expand beyond 25 workers, you have quite a bit to think about. That’s sure going to help job growth.”

Threat #4 – Cap and Trade, Significantly Higher Energy Prices
Another fiasco in the making is President Obama’s obsession with reducing and regulating carbon dioxide emissions by businesses and individuals, despite the solid research and objections of thousands of scientists that attest that carbon dioxide (CO2 is only 0.037% of the earth’s atmosphere) is not a pollutant and does not contribute to global warming or “climate change” of any kind. Dubbed “Cap and Trade” this legislation threatens to bring about enormous government regulation and taxation of energy production and usage across every single industry in the US.

A recent Investor’s Business Daily article outlines the inevitable consequences of such an intrusive scheme:

A major reshaping of our nation’s energy policy will include massive new taxes, mostly on businesses, and cause our economy to crater. Most depressingly, despite taxing businesses and consumers to the hilt, the Waxman-Markey climate stabilization act will not remove one ounce of carbon from our atmosphere over the next decade.

Waxman-Markey is nothing but a huge scam that will bankrupt any business that relies heavily on energy, boosting fuel prices by 22 cents a gallon and socking the average family with an $1,800 a year tax hike.

Threat #5 – Runaway Government Spending, High Inflation and Weakened Dollar
The countless government bailouts of bankrupt financial institutions and many incompetently managed companies, runaway borrowing and spending by the federal government (currently running $1 trillion yearly deficits, for at least another 10 years), and warnings from China, Russia, and India who are rapidly losing confidence in the US dollar and are threatening to dump it, are setting the stage for future hyper-inflation; another potential tsunami of financial devastation for all Americans. Under such conditions companies will continue to be increasingly risk-adverse, be very stingy with their cash reserves, steer clear of US-based capital expenditures that require a long-term financial commitment, and remain guarded with any expansion and hiring plans that would unnecessarily endanger the enterprise in the event of high inflation rates.

Staying the Course on Anti-Business Initiatives
Obama’s current anti-free market initiatives have been consistent from the beginning of his candidacy and throughout his first six months in office, and he’s aggressively making good on his promises with legislation that’s implementing them. Businesses understand what is happening and have tried to make adjustments. Like a living organism that has been attacked (imagine an octopus that’s drawing its tentacles closer to its body to protect itself from an intruder or another predator) business has contracted and retreated to avoid disaster and survive. Company owners and managers have taken on a defensive stance to deal with the worsening economic downturn and the coming higher taxes, increased regulations, and future hostile economic environments they will face even when the current recession subsides.

Consequences for the US Economy
The consequences of business activities contraction worsened by Obama’s multiple threats are devastating. Economy activity reduction, as measured by GDP numbers, reached -6.3% in the fourth quarter of 2008 and -5.5 % for the first quarter of 2009. Our economy has shrunk significantly in the last 9 months and the US unemployment rate has peaked at 9.5% as of June 2009. Since January of this year 2.7 million private sectors jobs have been lost, despite the so-called $787 billion “stimulus” plan that was supposed to keep unemployment rates below 8%. To date only $43 billion of this “stimulus” act has actually been infused back into the $14 trillion US economy; a miniscule and insignificant drop in a huge bucket that most likely did little to help an economic recovery. Yet President Obama insists that it “has worked as intended.”

Investor’s Business Daily reveals yet more alarming statistics regarding the US economy:

Shrinking GDP has crushed investment. First quarter gross private domestic investment — a proxy for business investment — plunged 20%, or nearly $450 billion, annually. The outlook is grim.

Worse, the June jobs data mark a milestone of sorts: Our unemployment rate equals that of the no-growth Eurozone nations.

What the Future Holds
As far as the eye can see President Obama and the Democrats are preparing to implement multiple significant tax increases, layer upon layer of new government regulations and restrictions on business activities, and massive and wasteful government borrowing and spending for at least the next decade. There is nothing coming out of this White House that would signal to American businesses that it is willing to change course and let the private sector – the only real engine of value and job creation in a free-market economy – do its job and bring our country out of this recession. The assaults on American business and entrepreneurship continue unabated and the negative consequences of these actions are already rippling through our economy and impacting our lives. Things are getting worse not better! At a time when a normal recessionary cycle should be coming to an end and the economy should be stabilizing and begin recovering, US business activity continues to contract, with hundreds of thousands of jobs (467,000 lost in June 2009) still being lost every month. We’re heading down a dangerous path that will virtually guarantee reduced long-term economic growth, higher unemployment and inflation rates, lowered living standards, and an erosion of our individual freedoms and liberties for the foreseeable future.

Senator Mike Johanns by Health Care Reform Analysis

Senator Mike Johanns

Senator Mike Johanns

Senator Mike Johanns today issued the following statement regarding the release of new data by the Lewin Group, an independent research institute, analyzing the House of Representatives’ health care reform legislation:

“I am stunned by this analysis, which even when allowing for a margin of error, clearly indicates the current proposal will decimate health care as we know it in Nebraska,” Johanns said. “This is exactly why Nebraskans are worried about government-run health care. Almost seven out of ten Nebraskans who have private insurance they like should plan on losing it and getting dumped onto the government plan if this passes. And even though you have coverage, keeping doctors and hospitals open in our communities will be a struggle when the profit margins turn negative.

“The Obama Administration has promised repeatedly that those who enjoy their current plans will not lose them. This study completely unravels that promise and leads me to believe we are a long way from a workable solution.”

The analysis released recently by the Lewin Group reached a number of specific conclusions regarding the impact on health care in Nebraska. Highlights of the study are outlined below. Lewin Group study projections of the House proposal:

– Of the 1.1 million Nebraskans who currently have private insurance, approximately 701,500 (65 percent) would be transitioned onto a government-run health care program.

– 31 percent of Nebraska residents currently without health insurance would remain uninsured.

– Nebraska physicians could see their net annual income decline by $230.7 million.

– An average loss in annual income of $44,953 per physician.

– Nebraska hospitals could have their net annual income fall by about $753.6 million.

– Hospital total margins could drop to as low as negative-3.9 percent.

Fishy?

Bill O’Reilly wants to get the facts about White House collecting “Fishy Criticisms”

White house Robert Gibbs responds to the White House Fishy Emails

Judge Napolitano claims White House seeking misleading internet names violates the constitution!

Linda Douglas definds the White House’s position on gathering names and getting information on people or companies spreading mis-information about the health care reform issue.

 

UPDATE: Monday August 17th: White House disables e-tip box!

Flag@whitehouse.gov has been shut down!  All “Fishy” claims about President Barack Obama’s health care reform are now being taken at www.whitehouse.gov/realitycheck

The “flag” service was introduced Aug. 4, with a White House blog post saying: “There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care. These rumors often travel just below the surface via chain emails or through casual conversation. Since we can’t keep track of all of them here at the White House, we’re asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov.” 

White House press secretary Robert Gibbs said at a briefing shortly after the service launched: “We’re not collecting names from those e-mails. … [A]ll we’re asking people to do is if they’re confused about what health care reform is going to mean to them, we’re happy to help clear that up for you. Nobody is keeping anybody’s names.” 

Sen. John Cornyn (R-Tex.), chairman of the National Republican Senatorial Committee, wrote a letter to Obama raising privacy concerns about what the senator called an “Obama monitoring program.”

“I can only imagine the level of justifiable outrage had your predecessor asked Americans to forward emails critical of his policies to the White House,” Cornyn wrote. “So I urge you to cease this program immediately.”

In a later statement, Cornyn said: “Of course the White House is collecting names. … [I]t is inevitable. Anyone with access to the flag@whitehouse.gov account has access to the names and email addresses that are collected in that account. … How are they purging names and email addresses from this account to protect privacy?”