It’s no secret that I am a partial Blue Dog Democrat, so all of this spending spree mentality is driving me crazy, just as it did when Bush did it.
I am not sure about tax hikes, but when I heard that Barack Obama was going to cap the amount a person can deduct for charitable contributions, I immediately imagined plenty of charities going under.
You see, many wealthy people practice what is called “Doing Well By Doing Good“. Without the benefit of deductions, their charitable contributions could easily tank. Then too, people should be able to decide who they give their money to and not be penalized just because they happen to prefer do donate to The American Cancer Society instead allowing the government to decide where their contributions go. Besides, they like to take their own credit for their own generosity.
The Republicans have rightfully complained about this idea, but since they already proved their own fiscal irresponsibility and partisanship– nobody from the other side is listening to them. After all, in a congress comprised of spoiled children on the playground during recess, “Gotcha last” is the game of choice, followed by “It’s my bat and ball and we will play my way”.
Fortunately, several Democrats agree so the issue remains alive.
WASHINGTON — President Barack Obama is meeting strong Democratic Party resistance to his proposal to reduce tax deductions enjoyed by upper-income Americans and could be forced to drop or modify the idea.
Mr. Obama in his budget blueprint last week proposed a cap on itemized deductions for mortgage interest and charitable donations to help pay for his health-care overhaul. The plan would cost wealthier taxpayers about $318 billion in new taxes over 10 years, according to government estimates.
But after objections from Democratic lawmakers, Treasury Secretary Timothy Geithner appeared to suggest at one point Wednesday that the administration was willing to consider dropping or modifying the proposal.
Finally, a Democrat asks a logical question:
Sen. Max Baucus (D., Mont.), the Senate’s top tax writer as chairman of the Finance Committee, told Mr. Geithner he was especially concerned about paying for expanded health coverage with a deductions curb that “has nothing to do with health care.” He added: “I’m wondering about the viability of that provision.”
……..and another:
“I’d like to think that people give out of the goodness of their heart, but that tax deduction helps to loosen up the heartstrings,” Nevada Democratic Rep. Shelley Berkley said Tuesday during a House Ways and Means Committee hearing.
Tim Geithner, after having mentally calculated votes and smelling a defeat said:
“We recognize there are other ways to do this,” Mr. Geithner responded during a hearing Wednesday. “We are willing to listen to all ideas that meet these broad principles.”
Filed under: Barack Obama, Congress, House, Tim "Turbo Tax" Geithner Tagged: | Barack Obama, charitable deductions, Geithner
--Graphic by Freedom Fairy
"This is not culture. This is not custom. This is criminal."
It makes me crazy that they’re treating mortgage interest and charitable donations as the tax deductions of the wealthy. They keep saying these are deductions of “upper income Americans”, but they are not. A whole lot of tiny businesses itemize their taxes, the self employed, families with a lot of medical bills. And I don’t have a link anymore, but studies have shown that those who give the most to charities are lower income people. Maybe not in overall amounts, but as a percentage of their income, they are the most generous. This wouldn’t just hurt charities, it would hurt working class Americans.
Wait till his Cap and Trade is in place and everybody gets hit with a buck tax on gasoline and tax on heating and light.
They are going to turn us in to a third world country with these environmental obsessions. We will all be using recycled cardboard in the bathroom by the time they are done. The planet will be here but we will all be dead from not being able to heat our homes or move our cars to work.
Wait till all those suckers buy the electric cars and find out what it costs to run them!
I remember when deisel cars came out. because deisel was cheap. What a sucker punch. They stunk like hell, sounded like mini trains, and you had to plug them in and keep them warm in winter. Once everybody figured out what a sucker punch it was, you couldn’t GIVE one of those cars away.
Plug it in plug it in! People in America are living in the freaking DARK because of the cost of electricity. Wait till they have to plug in their cars!
When they are done with us, we will all be generating electricity on a bicycle in the middle of the living room. You want some light? Pedal your ass!
yttik, the limitations you are referring to would only affect those earning over $250,000 per year. Also, the mortgage interest deduction limitation wouldn’t kick in unless your mortgage exceeded $750,000. I don’t think we’re talking about real hardship here for the wealthiest 5% of the nation.
In California, $750k for a mortgage is not wealthy, it’s middle class. And the property taxes on a $750k home are astronomical. No, they better not mess with the mortgage deduction.
hell where in california do you get a house for less than that even if you ARENT rich?
hey gang, try riding the NYS Thruway in this piece of shit.
http://videos.howstuffworks.com/podtech-networks/4088-neighborhood-electric-cars-video.htm
Oh and if you work 40 miles away, plan on recharging if you want to get back home. So you only drive it in your “neighborhood”. Everybody can afford one of these plus a regular car, right? It must be fun when there’s a freaking Tundra behind you in traffic, eh?
imustprotest: California real estate is grossly over-priced compared with the rest of the nation (other than the equally absurd NYC). If you look at the top 10 cities for over-priced real estate, CA has 7 of the 10. Sooner or later, Californians are going to have to bite the bullet and realize that their housing prices have to come back down to earth. Maybe this is one way to see that start happening.
A small business earning 250,000 is poor.
Depends where you live in the country, but a family making that much is not necessarily well off. If they’re paying a mortgage and medical bills and putting a couple of kids thru college, there isn’t much left over. People don’t understand the cost of living nowdays because we’re propping ourselves up with credit cards and loans and doing without the traditional things that went along with the American dream, like saving for retirement or putting your kids thru college.
Oh yeah, a congresscritter can’t even get thru a year without a 95,000 dollar petty cash fund, but we’re all convinced that 250,000 is real wealth.
Many small business owners have put their savings into their businesses, if only to meet payroll, pay vendors, especially to pay taxes. I can’t tell you how many people I know that have very little saved because they were taking care of their employees first and foremost. And back to this post’s topic, those people are way more generous with their charitable giving than any Obama supporters I know.
250,000 for a small business is not enough to provide jobs. We should be doing everything we can to encourage small businesses to want to grow so they need to hire people. Of course, this would require that someone in DC would have ever run a small company. Never mind.
250,000 in my neck of the woods is not poor, but it is not rich, either. It is rich enough to already be paying a ton of taxes, but not rich enough to be worry-free. You’re right, yttik, those people are paying for college for their kids, supporting other family members (esp. right now), paying their medical bills. There was an article about how this administration is going after the HENRY’s (high earners – not rich yet), but the author retitled them HENRI’s (with a French twist-ha….not rich indefinitely). The real wealthy will not pay taxes, those trying to get to real wealth will be kept in their place with the taxes.
ytt, it’s not a 95k fund. It’s on the average a 1.3 to 1.6 million dollar fund for each of them. The 93k is a raise!
I don’t think having California home values “come down to earth” by crashing down is the way to go, with all due respect. But I LIVE here, and I can see what is already happening. The whole economy is in some way linked to housing. How about having home values stabilize rather than crash? As I said, middle class, hard working families live in these homes. Children play in those yards, they go to the neighborhood schools. Lives are being affected, and not in a positive way. Sorry, but this is personal.
This one issue with this recession recovery plan. We are protecting the ultra-wealthy, who don’t pay taxes anyway, and bailing out their companies so that they can take their funds and move to new upper-exec jobs. We are subsidizing the poor, which, by today’s definition, means people who made bad choices. The poor that did not make bad choices will still work to pay their bills. This is not for them either. And the people in the VAST middle will pay for it all, and lose their shirts in the process. Why would anyone want to try to increase their salary right now? We have been told we will be taxed more, and that what we are spending now is a down-payment for future gazillion dollar spending (including congress’s freaking raise that they refuse to call a raise!).
The financial guy interviewed on Fox this morning (an Obama supporter) said when asked why we are pushing all of these other changes when we need laser focus on the economy….”his rating are high right now,he needs to spend his political capital”. Yeah, that capital is going to cost us trillions more into the hole.
I’ve said it before and I’ll keep on saying it. Messing with the mortgage deductions is just plain BAD for the housing sector. For a lot of people it sounds like a good idea and it’s not going to effect them…just the rich folk. If you live in a little town in middle America this sounds good but if you live on either coast or in metropolitan areas which a lot of us do it’s a real problem. We are now a nation of two income families. You need to make a lot of money to own a decent home to pay the mortgage and the taxes. You can’t buy a decent apartment in NYC without an income greater than $250K–that doesn’t make you rich that get’s you a starter home. This whole mess will create class warfare when in fact we’re largely the same people working for a living trying to get ahead but geographically opposed. Why should the people making a go of it in different areas be penalized? Maybe their jobs don’t even exist in less expensive markets. Aren’t we starting to disincentive the “American Dream”?
Grayslady,
While what you say is true in a theoretical world, millions of Californians and New Yorkers are living in the real world. They struggles and scrimped to buy that piece of real estate that you want to devalue now, and they still owe mortgages on it. No matter how you slice it, the middle class paid to get where they are, and they’re going to pay even more to either stay there or have your idealistic evening out.
Make no mistake! Uppity is right on the money here. This isnot something that is going to hit the wealthiest 5% of Americans. It is designed (although cleverly disguised) to hit middle America in the chest – center mass! What GAGirl said about HENRY/HENRI is also dead on the mark. The goal is to make sure that no one who is currently rich ever loses that status, and that no one that is currently not rich ever reaches that status.
Fear not, though. We will be allowed to change our status in America. You will be
forcedallowed to go from being middle class to being poor.Comrade KB: The idea of the American Dream is in the way of the Glorious Cause.
When you dumb down your education system do that a blob can graduate, you produce mediocre people who don’t mind living the mediocre life you have planned for them. When at the same time you are dumbing down your schools, you pump up the ego of a mediocre person, they emerge imagining they can do anything that they are achieved, because mediocre looks like it’s Great to them. When you hand out trophies just for playing you produce good little comrades that you can con and fool till the day they die.
Thank you Grail, you said what I was trying to say much better!
Eliminating the home mortgage interest deduction might have been a good idea about 5 years ago when the economy was better, but now it’s another plan to put people who are struggling into indentured servitude to the government.
And the real resaon for getting rid of charitabel deductions is that it was money the governent wasn’t getting for themselves. In Obamaworld, charity is something the governent does with your money. The gloriious breadlines of deal leader’s beloved Soviet Union were far more efficient than the average local food bank trying to help people one-on-one
Well said P4!
Well, our home prices are crashing home to earth, too, grayslady. I am pinned here. Trapped. Can’t sell, can barely make the $1250 payment, no work for writers, everything going up in price, even credit (the poor person’s bridge loan) being ruined, ack. I am underwater…so what do we do–wipe out a generation or hopes and toil and pretend this never happened…