When It Comes to Economics, Obama Is Like One Aspirin for A Migraine!

Obama is saying that tax cuts could create millions of jobs.

Angry House Democrats voted today to table a proposed tax cut extension that includes the nation's wealthiest Americans, even as President Obama said his deal with Republicans has "the potential to create millions of jobs."

Of course this gets back to the idea that if tax cuts / maintaining the current tax rate, creates jobs and stimulates the economy; why would you not want to make the Bush era tax rates permanent?

The problem here is that the democrats are making statements not based on facts. The question is where does the majority of government revenue come from? This table is on page 97. of the PDF.

Quick math will reveal the following:

Income Taxes: 1.146 Trillion

Other Taxes  : 1.359 Trillion

There are more taxes collected by means other than personal income taxes. The next logical question would be this...

Does a decrease in income tax revenues at all levels equal an increase in other tax revenues? Without having Douglas Elmendorf on speed dial I would have to argue that a decrease in income tax revenue will result in an increase in overall revenue to the government.

If the majority of tax revenues come from sources other than income taxes, wouldn't it make more sense to let all people keep more of their money, which in turn, will result in more spending and more jobs. More people working will result in more people spending. This is the basic idea behind the Reagan economic model. An economic model that has been proven to work.

So, the current tax rate should be made permanent (for everyone) that is --if long term economic growth is the goal. If a tax increase will result in fewer jobs created; why let it increase? Do politicians want the country's economy to stay down?

What do you think?

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