“I can make a firm pledge,” he said in Dover, N.H., on Sept. 12. “Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”
…
Now in office, Obama, who stopped smoking but has admitted he slips now and then, signed a law raising the tobacco tax nearly 62 cents on a pack of cigarettes, to $1.01. Other tobacco products saw similarly steep increases.
…
This is one tax that disproportionately affects the poor, who are more likely to smoke than the rich.
Of course, this massive, deceitful tax hike also affects the poor more because their cigarettes are a larger proportion of their income. It’s an extremely regressive tax.
As I said last year, Barack Obama ran the most dishonest campaign in recent history. He won because the media loved the idea of Barack Obama, and if they were willing to spike the Rielle Hunter love-child story for three weeks on behalf of John Edwards, the lengths and depths they went to for The One can only be imagined.
{ 38 comments }
does this mean those who save money by quitting smoking to avoid the higher taxes owe obama thanks for a massive tax refund?
This actually demonstrates two of Obama’s most troubling traits.
First is the obvious deceit in introducing a huge new tax that disproportionately affects the poor, demonstrating that Obama is not really interested in providing financial relief for the poor.
Second is related to the first in that Obama sees this as a win-win. If people keep smoking, then the government rakes in billions of extra tax dollars, effectively giving him cover for other spending in other areas at the expense of cigarette smokers. But more importantly is that Obama sees this the same way he sees $4.00/gallon gasoline. He sees it as INCENTIVE to make people CHANGE THEIR LIFESTYLES to a lifestyle Obama and his ilk approve of. So to Obama there’s no downside.
It’s like his deceitful use of cap and trade to make people think that power companies are raising rates instead of what this actually is, which is an energy tax. And not coincidentally an energy tax that also disproportionately impacts the poor. To offset that Obama offers tax credits or rebates so he can claim to have given relief, when the net effect is likely to still be overall negative. Again Obama sees this as a win-win. He sees people getting angry at big polluting energy producers while viewing him as Mr. Candyman who comes to the door with free checks, paid for by the very energy price increases caused by his cap and trade scheme in the first place.
It only works because the average American is economically, politically and in most other ways, illiterate beyond belief.
zach:
No, as Dave pointed out, it makes him a liar.
keith,
that doesn’t answer the question. those two things can simultaneously be true. but, does this make him more or less a liar than g.h.w. bush? especially since this is not a tax “on” anybody. anyone can quite easily avoid it by simply not purchasing cigarettes.
I think I would require that you submit proof that Bush lied if you’re going to make that assertion. Such proof would need to contain evidence that Bush deliberately and with forethought said one thing and then did another. With regards to WMD in Iraq, which is what I presume you’re referring to, I doubt that you can provide that proof.
In this case, Obama has made a statement that he would not impose a tax on anyone making less than $250k annually (combined family income). And yet he has just signed into law an increase in taxes on a consumer item which is certainly an optional one, but nonetheless is widely used by many people under that same $250k income level.
If you’d like to argue whether taxes are optional, I suppose we could also state that fuel taxes are optional as well. But why stop there? Aren’t income taxes optional? I mean, if I want to avoid that tax shouldn’t I just quit my job and live off the government? Isn’t that, in fact, often the purpose of a tax – to change the public’s behavior?
Would you feel ok with taxing mouse-clicks to read blogs? Or make blog comments? That’s optional too, ya know. You don’t need free speech to survive after all. The fact is, and this isn’t an isolated incident as Dave and others have illustrated, Obama says what’s necessary to garner public opinion then promptly does something entirely different from what he said. It’s a familiar pattern, one that Clinton used throughout his two terms. As a voter, I find it repulsive our politicians, of any political stripe, treat the electorate as stupid and misinformed. But as CC already noted, the significant majority are in fact completely uninformed and illiterate as to how are government works. I suspect that many politicians and media elite like it that way.
Arrgh! What happened to edits???
actually i was talking about bush senior. as in “read my lips.”
I think that is a fair comparison zach, Obama is liar on taxes as was Bush the elder.
I’ll agree with that. Sorry, didn’t see the “h.” in your post, Zach.
It only works because the average American is economically, politically and in most other ways, illiterate beyond belief.
The same America that voted for Bush in 2004? Man how fast things change in four years. Let me guess when the people finally vote a Republican back in it’ll be right back to “America always wins” and “the People have spoken” won’t it?
It’s good to see that there are intelligent people out there who are willing to call the American people stupid in order to improve the conditions of our country. You must be one of those liberals that believe people are lemmings and subject to propaganda.
I must admit the tax convinced me to quit smoking. This is old news and it was coming down the pipe for at least a month now. It’s a tax on a vice and can’t be equated to a tax on the poor. If the poor can’t afford to smoke they’ll quit. It’s not the same as an income tax which forces you to pay by law. I would suggest spiting the Government by not buying any cigarettes if it upsets one so.
jrogge:
Go find the post or comment from me where I lauded the wisdom of the American people in voting for Bush.
I have repeatedly said that our political system puts the decision of who will lead us precisely in the hands of the least informed, least aware and least involved people in the country. That’s because approx 1/3 of the country are Left of center, approximately 1/3 are right of center and 1/3 are unable or unwilling to make an ideological decision and as such tend to blow with the political winds. That’s true when Reagan wins and when Obama wins. It is completely fair to point out how similar that opinion is to liberal elitists opinions about the public. I am entirely guilty of being an elitist in that regard.
A tax on a vice is a tax on the poor if it is easily provable and generally recognized that the vice is disproportionately engaged in by the poor.
I don’t smoke. But not because of taxes.
Oh, and do I rejoice when the ignorant, illiterate, blown by the wind voters are fooled into supporting my agenda? And do I cringe when those same voters are fooled into supporting my opponents?
Of course I do. But at root I wish the game weren’t all about who has the better PR, the better hair and the nicer smile. Unfortunately much actual research indicates that height has more to do with winning Presidential elections than intelligence or integrity.
Of course I do. But at root I wish the game weren’t all about who has the better PR, the better hair and the nicer smile. Unfortunately much actual research indicates that height has more to do with winning Presidential elections than intelligence or integrity.
Actually I wouldn’t say intelligence wins, but the appearance of intelligence sure does. In any case, we haven’t had anyone run that has real balls in years. To mired down in the system to get as far as they do, they end up in varying degrees of corruption by the time they make it.
No worries though. America always survives. It isn’t the end of the world and Obama is actually going in the right direction in a few things. I say let him go. Considering that he has the least amount of Washington experience, it actually gives me more hope for him than I would have for many others that are part of the system.
I hope he creates absolute chaos. I probably won’t get my wish though.
BTW A tax on a vice is simply a tax on a vice. It is entirely possible to quit smoking. This is really a non-issue and is part of the whole Democratic non-smoking thing. So, if you want to give money to Uncle Sam go ahead and smoke. Otherwise it doesn’t affect you and there’s no use having a stroke about it.
jrogge:
I’m sure all the poor hooked cigarette junkies who sacrifice their insurance payments to buy cigarettes will agree with you on this.
“America always survives” is true until it isn’t.
So in four years we’re going to see the collapse of America. We’ve been through wars and natural disasters and other nasty things. But the downfall of America? A black guy who likes leftish things!
Pffft.
“America always survives” is still true. If you want to blame anyone for our economic problems blame the people who used hedge funds to crash stocks and control the market. You can also blame the various people who put themselves in a massive amount of debt instead of rejecting goods as the laws of supply and demand should have dictated. All this debt had to wash up somewhere sooner or later. Whether it was a ton of government spending, having to support our parents after their retirement money went up in smoke, or inheriting the massive amount of debt that would pass on after they die. My generation was going to pay for the previous generations mistakes. i have accepted this fact now for the last 6 or 7 years.
You act as if McCain would have been so much better. We would have had the same scenario with a different coat of paint. It probably would have been even worse in the end. Because McCain has a retirement account he wants to replenish shortly I am sure. More social security nonsense, more tax cuts (which are an antiquated concept at this stage of the game), and more of watching my chances at retirement go down the toilet to save the current old generation’s.
As far as the hooked cigarette junkies… they should quit. If you let a substance control your life it’s no one’s fault except your own.
You’re right though, if he wants to raise taxes he should go back to a 60% tax on businesses. The cigarette tax is a poor choice for raising government funds.
jrogge:
Sadly, it is Obama’s intention to give these same people who really can’t afford to smoke a benefits check of $400 per person. That should get them a few cartons I guess.
As for who to blame for the current issues, I suspect part of it is cyclical, but much of the blame lies with our government for pushing the government backed mortgage companies to make loans to people who couldn’t afford them. The non-government backed lenders followed suit to compete and all of them did so with poorly crafted products which blew up in their collective faces. The administrations and congresses from Clinton through today bear the ultimate responsibility for this mess.
Which makes it all the more ironic when crooks like Frank, Dodd and Obama feign outrage over the bonuses paid to AIG executives. How stupid do they think you are? The wrote the legislation granting the money and even excusing the bonuses, and we’re supposed to believe they’re really outraged? The fact that the majority of Americans blame AIG for giving the bonuses when in fact it was Dodd, Obama and Frank crafting and passing the legislation is all the evidence in need to know that the majority of the American electorate is gullible and poorly informed.
I don’t think that in four years we’ll see the downfall of America. But it is entirely possible that our strategic position, both economically and militarily, will be diminished because of the actions of this president and congress. I suppose you and I fundamentally disagree on the nature of humans, and a return to greater welfare and socialism is something which you support. I believe that these approaches are flawed and that this fact has been proven before both in the US and elsewhere. I only hope that something more coherent than the current confused message in the Republican party can be put forth and articulated. And for the record, McCain wouldn’t have been much better, which is why I didn’t vote for him.
McCain would have been MUCH better than Obama. But he still would have been far less than we actually need.
jrogge,
“If you want to blame anyone for our economic problems blame the people who used hedge funds to crash stocks and control the market.”
Can you elaborate on this? The implication of your statement seems to be that an unnamed group of people wanted to crash stock so they used hedge funds (a very broad term, btw) to do so? I don’t follow, how did they do it? And who is they?
I think jrogge must be talking about George Soros. ;)
I am referring to activist hedge funds and hedge fund bullying. Stuff like trying to force McDonald’s to sell off it’s privately owned restraunts and then do a stock buyback. Hedge fund bullies. Using the monies in a fund to put pressure on a company or a stock, sometimes for the purposes of hostile takeover.
It is very common and you can read all about hedge-fund bullies in any magazine that is business related. CFO for example.
The stock crash is all about what happens when the house of cards begins to fall around leverage and greed.
The non-government backed lenders followed suit to compete and all of them did so with poorly crafted products which blew up in their collective faces. The administrations and congresses from Clinton through today bear the ultimate responsibility for this mess.
Odd how they had to do that to compete. Many smaller banks did not do that. My bank for one requires good credit and a good chunk of money down for a mortgage. Many other are the same way and have always been the same way. Banks were not forced to do bad business.
Now I can buy the fact this has been a long time in the making, but which piece of legislation are you referring to? The Tax Exemption? I don;t think Frank and Dodd are long for this world anyhow. Their re-election probability is very low. The assertion that Obama actually penned the amendment is news to me. It has been advertised as an amendment Dodd penned. Dodd can say what he want’s but Obama was not in the Senate and Frank hasn’t been mentioned in regards to this in any news article I have read.
I actually don’t want to move towards socialism and welfare, but this is where we will end up. When an economy tanks like this the money hole always sucks up government funds sooner or later. The problem is what was the other solution, lower taxes? This would decrease our ability to pay existing interest, coupled with the fact that it does not release as much money into the economy now as it did when Reagan and Kennedy did so. It offers no solution and inevitably taxes rise along with government spending. There was no way out.
I can say this, I have gotten more leverage on things since the stimulus passed than I had without it. Bush’s stimulus check did absolutely nothing for me. Especially the first one, which I was ineligible for due to troubles finding work and having a bad year. So he helped out the people with jobs, and didn’t help out those who were having difficulties. No matter, like I said I always persevere like most other people because it’s what people do.
Still, having all my goals sped up due to certain provisions in the bill that benefited me is something I can appreciate. If you want to blame anyone for any rise of socialism in this country, blame the people who had a good thing and squandered it. Blame the people who spent all the money they didn’t have and were unable to pay their bills when an emergency hit. This also, is a huge reason why we had so many foreclosures. Blame the banks too for the seizure of property without any sort of attempt to reconcile with the individuals or refinance in an effort to maintain business. If the housing bubble is supposedly Clinton’s fault, the large number of foreclosures is the bank’s as well.
In any case I do not think we are going to become a socialist gulag. We’ll just have a shit ton of debt and most likely high taxes. If people can’t survive that then they are weak and deserve to die. There are larger problems to have than that.
jrogge,
Yes, I’m aware of activist hedge funds, they might make up 10% of the hedge fund population, I just don’t see how they “crash stocks” and “control the market” even when you surround them with the buzzwords of house of cards and greed.
Well Paul it’s simple really. You bet on a company to fail. If enough money goes into this people take notice and the stocks crash because at this point they must be failing if so many people are banking on it. At least it’s the assumption you try to create. It’s yet another way to use them as leverage. The funds that were invented a long time ago are being used more creatively today. It’s almost fraud. Couple that with activist hedge funds that put pressure on companies and you have a recipe for disaster. These kinds of shenanigans caused a lot of people to lose money.
Why don’t you tell me how this is not true?
Here is one example there are many more but this one is convenient now I must finish my paper
Sorry, that article just tells me that Barclays was sold short and the stock went down. We all know that correlation is not causation, but are you really making the argument that Barclays was a healthy and well capitalized company until a hedge fund came along and sold them short? Are you aware of how long short selling has been going on? Are you also aware that selling a stock short does not change the actual underlying reality of a company’s profitability, balance sheet, or cash flows? Do you even know how a short sale works? The position has to be covered eventually, so when these hedge funds buy up the same positions that they shorted don’t they create the opposite impression and trick people into believing that the company is healthy again? Oh wait, it’s not a trick because they were healthy all along until they were sold short! You can’t be serious with this.
There are many more long only investors out there in the world than hedge funds, so how come all of these fund manager’s purchasing stocks doesn’t create the assumption that everything is healthy? Moreover, Hedge Funds keep it very secret what positions they have, which is unlike retail mutual funds, so I am wondering how and what people “take notice” when a Hedge Fund takes a large short position?
Crap Paul, why’d you have to bring logic and facts into this? That ruins everything.
Okay Paul I understand what you are saying. But if that is the case why did the Securities and Exchange Commission order that the short sales of various funds be disclosed with the reason that short-sellers and funds of such a nature were driving down stock prices?
Small article on this.
Also, why are there reports that funds have been banding together and pulling money out en masse before a short sale is up to drive down the stock prices for a hefty profit? Doesn’t that sound like a collusion to influence a short sale buy driving down the stock price, thus damaging the bank or company? The Barclays article was something I quickly posted because i had other things to do. but are you seriously trying to tell me despite that reports on Bloomberg television, Business Week, CFO, many blogs that monitor stock and trade, and other various sources of information out there that point to what I am talking about that this is not going on? Further still that it is even ethical?
Crap Paul, why’d you have to bring logic and facts into this? That ruins everything.
Unlike you Paul has given me a coherent and intelligent response to my question so I will have a discussion with him if he wishes. It’s a lot better than the simian poop-flinging diatribes that you tend to get into.
“It’s a lot better than the simian poop-flinging diatribes that you tend to get into.”
As opposed to this sterling example of rationality, common sense and mutual respect.
Don’t you kids make me come down there!
Simian poo keeps Mike Rowe employed. Up with the poo!
As opposed to this sterling example of rationality, common sense and mutual respect.
Considering that you still haven’t contributed anything in this discussion other than insults which is your typical MO. It is a sterling example of rationality in comparison to what you spew. As I said in another thread you really need to look at yourself because you are a classic example of projection psychology.
Never said that there wasn’t fraud or unethical behavior, just that it isn’t near the top of the list of what has caused our current troubles. Moreover, there is nothing inherently wrong with short selling. For one, you can’t short sell to no one. Somebody has to take the other side of the transaction, so it’s not clear to me that a short position drives down a price as there are an equal amount of buyers. The idea that a hedge fund can control the market overstates things quite a bit. If you need proof, just look to average hedge fund returns for 2008.
Your link doesn’t seem to work, but if people are involved in market manipulation then of course they should be prosecuted as it is against the law.
“Considering that you still haven’t contributed anything in this discussion other than insults which is your typical MO.”
Hmm… perhaps you should go back and read my comments here and other places. I’m sure I contributed some neocon demagoguery and some right-wing hate-mongering too jrogge.
At least in your eyes.
Sorry Paul.
Another article
Actually this link is probably better considering it outlines both sides of the argument that was occurring awhile back. I think both sides are right, oddly. What I am driving at here isn’t that this is the SOLE reason for the drop. We also had the housing market drop as well and bills set in place that were partly responsible for the increase in housing prices which cause a bubble that popped and tanked the mortgage backed securities. However, people are trying to single this out as the sole reason we are in this mess. In reality, there is a lot going on and I agree with you that this cannot be the sole reason for the drop. But I wouldn’t be surprised if we discover that this had a lot to do with the crisis in the effect that it kept the market down longer than necessary.
Unfortunately, they cannot be prosecuted as what they are doing is technically legal and a flaw in the current laws and regulations. Rules regarding the conditions of a short sale, such as naked short selling, should be changed. It seems to me that being able to “bet” that a stock will go down gives a speculator plenty of motive to practice unethical business.
Buying stock in the hopes that it goes up gives us incentive to help businesses prosper. Selling stock at a higher price in hopes that it goes down by the time you buy it back gives the investors incentive to see a business fail. That is probably marginally acceptable in a healthy market, but in a bad one it can ruin a company that may otherwise have survived if not for the veritable rug being pulled out from under them.
I feel it is justifiable to place a good weight of blame on these tactics. Fortunately, it is correctable with some rules changes.
“It seems to me that being able to “bet” that a stock will go down gives a speculator plenty of motive to practice unethical business.”
But what if it is a crappy company whose stock price cannot be justified by its intrinsic value? Besides, doesn’t “betting” the stock will go up provide the same bad incentive for a speculator? Earnings manipulation by management tends to only go one way, and guess which way that is?
What if I, as an analyst, feel that company X is manipulating earnings and have overstated them for a number of years, short selling the stock will help push the price back to its justified equilibrium (and perhaps prevent pricing bubbles).
I don’t want to get too technical, but short sales can also be combined with borrowing/issuing a bond, a call or put option to create a synthetic position identical to holding the underlying position. (see put-call parity) What this does is force prices to their equilibrium to prevent arbitrage opportunities – it is a big contributor to the efficiency of the capital markets.
What I am getting at is that short selling is more than just betting that a company goes down, and there is plenty of room/incentive for manipulation in both directions, so I still don’t see that short selling is inherently bad and something that needs to be banned… except by politicians who always feel the need to do something, anything in the midst of crisis.
Comments on this entry are closed.