Over at Opinion Journal, Pete duPont chronicles the ways in which the Democrats will be, as bad, if not worse than the Republicans on economic issues:
? Tax Increases. From the liberal perspective the good news is that the major Bush tax cuts will expire in 2010. So if the Democrats simply do nothing, the tax rates on lower-income individuals will rise to 15% from 10% and on higher incomes to 39.6% from 35%. Clinton Treasury Secretary Robert Rubin says that tax increases are the only way to solve the nation’s fiscal problems, so that will be the Democratic strategy.
? Spending Increases. The incoming House leadership says it will hold spending flat for the remainder of the current fiscal year. Perhaps, but for liberal Democrats spending increases are political no-brainers: appropriate more and expand the government to make the country better. And if the deficit grows, well, that’s because of the Bush tax cuts, not the Democratic spending increases. Historically Democratic Congresses have outspent Republican ones, and it will surely happen again.
? Alternative Minimum Tax. A 1969 tax increase that was enacted to soak the rich is suddenly going to seriously soak the middle class. Some 3.5 million taxpayers paid the AMT this year. But unlike the regular tax, the AMT is not indexed to inflation, which means the number of taxpayers the AMT hits is expected to balloon–by some estimates to as many as 23 million in 2007. Less than 5% of families with incomes between $100,000 and $200,000 are now paying the AMT, but more than 80% may pay it in 2008. Almost no families with incomes of $50,000 to $100,000 pays the AMT today; but as many as 35% of such families will in 2008.
? Protectionism. Almost as passionate a liberal idea as spending more money is abandoning free trade and returning to protectionism. The AFL-CIO wants to limit lower priced goods from being imported into America even though it gives people a wider variety of products to choose from.
? Energy. One of the last acts of the current Republican Congress was to pass legislation permitting more oil and natural gas exploration in the Gulf of Mexico. It will lead to the production of about 1.3 billion barrels of oil and 5.8 trillion cubic feet of natural gas, two things America badly needs.
Translation: We’re screwed.
December 21st, 2006 at 10:18 am
Quite a lot of Republicans are going down the protectionist road too…