Up until two days ago I had hopes, as small as they were, that sequestration would be avoided. My thoughts were along the lines of how this was going to impact the economy along with the massive tax increase that recently was passed. Personally, I earned a raise towards the end of the year. Since January 1, however, I now bring home less money than I did prior to the raise. Obama’s tax increase on the rich seemed to impact me directly, and I guaranty that I am not in the wealthiest 2%. If I were, I’d be traveling the world and paying somebody else to write my thoughts without typos. I’m sure many of you have noticed a decrease in your take home pay as well.
Many people believed Obama was a supply- sider after the first debate when he made a clear argument for supply side economics. Why wouldn’t they? He talked such a good game, but like so much of what he says, he just doesn’t deliver.
PRESIDENT OBAMA: Well, I think — let’s talk about taxes because I think it’s instructive. Now, four years ago when I stood on this stage I said that I would cut taxes for middle-class families. And that’s exactly what I did. We cut taxes for middle-class families by about $3,600. And the reason is because I believe we do best when the middle class is doing well.
And by giving them those tax cuts, they had a little more money in their pocket and so maybe they can buy a new car. They are certainly in a better position to weather the extraordinary recession that we went through. They can buy a computer for their kid who’s going off to college, which means they’re spending more money, businesses have more customers, businesses make more profits and then hire more workers.
As it turned out, President Obama favored “Trickle Down Economics”, you know, where the working man throws his hard earned money up to big government and waits for it to trickle back down. The problem with this is, the more money that’s taken from your paycheck for taxes, the less money you have for daily necessities. We’re not talking about new computers, necessarily, but we are talking about daily items. Maybe you forgo the cup of coffee in the morning, or maybe you shift your behavior. For example, instead of a daily trip to the local coffee house, you brew the cup at home. Whether it’s a small sacrifice or a shift in behavior, the local coffee house brings in less money. With less demand for their product, the need for employees decrease, leading to less hours or jobs cut from the payroll. The less people work, the less they earn, the less they earn, the less money they pay to the federal government. The less money people pay to the Federal government, the less tax revenue the government brings in. It works both ways.
My main concern with “Sequestration” is simply that before we make any more changes, we need to let the tax increase ripple effect come to fruition before we do anything more to the economy. We ought not cause potentially more harm.
But it was this article on McClatchy that caused my change of heart. It’s an article about people who work for the Federal government who were upset over sequestration. The one that really caught my attention was from Gregory Russell:
“I am a registered Republican. However, I blame the Republican Party for this,” said Gregory Russell, a 48-year-old federal firefighter at the U.S. Naval Academy in Annapolis, Md. Russell calculates he’d lose about $1,200 a month – about 20 percent of his pay – if he gets furloughed.
I thought that was a little bit of a long stretch, considering a guy who earns $72,000 dollars a year can’t live on only $4,800 for no more than 30 days. Wow, shocking, tighten up your belt a little bit, like a good Republican… but wait… there’s more. Turns out that Gregory Russell is one of those Republicans for Obama, giving twice ($250/$450)to Obama’s campaign in 2008 and forked over another $250 to Frank Kratovil (Democrat). While Gregory Russell appears to give to “Republicans”, they are different people.
So here I am, making less than $72,000/year, now having to live with less money thanks to President Obama’s insistence that my taxes go up, and here’s this guy who benefits from my taxes complaining that he can’t live off of $4,800 for one month, which is still more than I bring home. And how a guy who makes $72,000/year doesn’t have an extra $1,200 sitting in his bank account in savings is beyond me.
That comment really just didn’t sit right with me, and I began to see the article in a much different light. For example, take this paragraph:
All across the D.C. area and the rest of the country, federal workers like Blevins are having tense, belt-tightening conversations with spouses, kids and co-workers. They’re canceling little luxuries such as cable, cellphone service, restaurants and movie nights, putting off long-planned vacations and searching for second jobs. Some are thinking about raiding their 401(k)s for emergency cash.
So, do we hear about people all across America having to sit down at the table and have belt tightening conversations with spouses, kids, and co-workers because of their tax increases? I know that’s happening, I see it at work, I see it in meetings, I see it everywhere. These guys have to be on furlough for “no more than thirty days, the average working person earning less has to do with less for the whole year and are now listening to the President insist on “tax increases on the wealthiest 2%” which was what the last tax increase was supposed to be.
President Obama often talked about tightening our belts. In a city that voted 91% for Barack Obama’s re-election, they should be the first to “tighten their belts”, not the first to whine about it.
The saddest thing is that Washington has a different language than you. You see your paycheck decreased, they call that stimulating the economy. In the 90s they said we had a surplus because the deficit wasn’t as big as they thought it was going to be, which normal people would still call that a deficit. In Washington speak, the definition of cutting spending (sequestration) is not increasing spending as much as they were planning to, but they still increase spending.