To preface, I'm a strong Obama supporter. I've watched him pretty intently for quite a while and I'm pretty confident in his ability to weigh all of the information and make intelligent decisions. Having said that, one thing I am concerned with is the tax increase on small businesses that earn over $200k. I've tried really hard to get numbers on how many small businesses will have an increase in taxes but I can't really find anything that pins that down. I've read from 700,000 to 450,000 small businesses that would be hit by the 3% increase. That seems like a ton to me. The tax cuts to the middle class should increase consumer spending but does it increase spending enough to offset the 3% tax increase on small businesses? Does anyone have projections on that? I really have trouble with the idea of raising anyone's taxes in a recession. I would hope that unless Obama has good figures on the offset that he would reconsider that part of his tax plan until the economy rebounds. I realize it's only 3% and that these rates existed under Clinton but we're working under an extreme situation right now. I would really hope there'd be some way to exempt small business owners who are employers from a tax increase, at least in the meantime.
When the overall economic health of Americans improve consumer spending should increase as well. The increase in consumer spending should exceed 3%. If you want the reverse effect; Check the projected decrease in this year's Christmas sales, far more than 3%. When the economy is doing good, everybody is doing better. Small businesses are the engine that keep the country going, but without consumers many will go out of business, and more people will be without jobs. When a much higher percent of Americans can provide basic needs for their families like food on the table and clothes for their kids; When more Americans can keep their jobs; Small businesses are better off. Just look at what's happening at restaurants these days. Less and less people are eating out; business is slow, people are tipping less, waiters/waitresses can not make enough working at the job, Meanwhile, restaurants are in a situation they CAN NOT raise prices. Who takes the hit? When there are more American's that can provide basic needs, there will be more Americans that will purchase more Goods and Services. This means Small businesses can hire more workers, and even expand their business, etc. Furthermore when the economy finally find some stability and consistency, there will be more opportunities for new businesses overall. Trickle down economics does not work. Plus the rich won't miss the 3% nearly as much as the laid-off miss having their jobs. On the political stand point, I think being concerned with the overall well-being of American citizens, and implementing actions to improve their situation, even if it means taking a personal sacrifice; makes one "patriotic". Not this warmongering evangelical socialist-allegating propaganda crap, when we all know they are the result of selfish reasons.
Doesn't consumer spending make up most of the GDP? The majority of small businesses don't make over $250k. They depend much more on domestic business than international. It will be a large economic stimulus.
I believe the obama plan is close to a net zero plan. The tax cuts to the poor and middle class is offset by the tax increases and the elimination of loop holes to the top. He is trying to make more money available to the people that are more likely going to spend it. Who are they going to spend it with? Businesses, small and large. Trickle up economics for a lack of a better term. The only thing this plan doesn't help is the money available for investment since most investments are made by people making more than 250K. However we have 700 billion dollars plus all the other money for AIG and crew for that.
