{"id":7392,"date":"2008-04-08T01:01:01","date_gmt":"2015-01-08T19:40:19","guid":{"rendered":""},"modified":"2015-01-08T19:40:19","modified_gmt":"2015-01-08T19:40:19","slug":"the_truth_about_the_economy","status":"publish","type":"post","link":"https:\/\/admin.rushlimbaugh.com\/daily\/2008\/04\/08\/the_truth_about_the_economy\/","title":{"rendered":"The Truth About the Economy"},"content":{"rendered":"

\"Listen<\/a><\/p>\n

RUSH: Ft. Lauderdale. This is Paul. Great to have you on the program, sir. Hello. Hey, what\u2019s happening, what\u2019s up, what\u2019s going on, hello?<\/p>\n

CALLER: Longtime listener, first-time caller. I\u2019m so glad I was able to get through to you.<\/p>\n

RUSH: I\u2019m glad you made it.<\/p>\n

CALLER: Thank you so much. You\u2019re the real American hero. I\u2019ve been listening to you for so long, and I wanted to talk to you for so long, on so many subjects, but I just want to mention one thing about the economy. Right now everybody\u2019s saying and touting in the mainstream media and even in the news outlets that wonderful things are happening because of Obama\u2019s policies for the past eight years, whatever, six years, and all these kinds of things. But one thing I think they\u2019re all missing is there are 35 to 37 Republican governors in the 50 states of the United States of America, and they\u2019re working day and night and hardworking, bringing the budget to balancing and having the surplus in their budgets and bringing down the unemployment rates —<\/p>\n

RUSH: No question that that\u2019s a factor. There\u2019s no question, Paolo, that that\u2019s a factor.<\/p>\n

CALLER: Yeah, these are all the facts, and that adds up to the national level and Obama is running around saying, look, his policies are working. It is exactly the opposite —<\/line><\/p>\n

RUSH: Speaking of that, we just got — did I put it at the bottom? Mike, you just got an Obama sound bite, and I\u2019ve already put it away. I don\u2019t even know what number it was. But it\u2019s the last one that came in. Maybe 24. Grab 24. Here\u2019s Obama. Yep, yep, yep. Yeah, he\u2019s out on the campaign trail and he\u2019s talking about, on purpose, one day after this massive attack in Paris, he\u2019s out there talking about how great everything is, how the economy\u2019s back and how the wars are over.<\/p>\n

OBAMA: There are workers today with jobs who didn\u2019t have jobs last year. There are families who\u2019ve got health insurance who didn\u2019t have health insurance before. There are students who are in college right now who didn\u2019t think they could afford it before. There are heroes who had served tour after tour who are finally home with their families. There are autoworkers who are building great American cars now when they thought that those plants were gonna shut down. America is coming back.<\/p>\n

RUSH: They planned on saying this six years ago no matter what was happening. He\u2019s in Phoenix at Central High School where he said this today. Now, I have to be very careful here because the economy is up, but it isn\u2019t as robust as he\u2019s portrayed here. It just isn\u2019t. And if you think the economy\u2019s roaring back, but you feel left out and wondering why, you\u2019re not left out. The fourth quarter GDP rate was indeed, until they revised it, 5%. And over half of the spending, over half of the consumer spending that created a 5% growth rate was people mandated to buy health care. <\/p>\n

Do you think health care is a, “Hey, man, let\u2019s go get some health care today. Man, wow, cool,” as, “Hey, man, there\u2019s a new flat screen, it\u2019s on sale at Best Buy. Let\u2019s go.” People don\u2019t go out and buy health care. It\u2019s a mandated buy. It\u2019s over half of the economic growth. But there are people who do not have health insurance today who had it two years ago. It\u2019s the exact opposite of what he\u2019s saying. They can\u2019t afford it. And all this other stuff. But this is the plan now. Again, it\u2019s symbolism over substance, and it\u2019s the launching of the final two years here. A giant image being created. Get used to it.<\/p>\n

BREAK TRANSCRIPT<\/p>\n

RUSH: Obama was gonna say what he said in Phoenix today regardless of any other current event. He talked about this great economy going on and how the wars are over, and he did not even mention what happened in Paris yesterday. There are workers today with jobs who didn\u2019t have jobs last year. <\/p>\n

The sad reality is that the labor force participation rate, which is a calculation of a percentage of available people who are working, is at an all-time low. We are very close to 93 million Americans not working. We have lost millions of jobs from the job universe since Obama was immaculated in 2008. <\/p>\n

\"original\"The unemployment rate is deceiving. The unemployment rate that\u2019s reported — and again I\u2019m passing this on to those of you listening for the first time today. Those of you who are regular listeners are gonna know this and I\u2019m sorry for the redundancy. But the unemployment rate that\u2019s reported does not count people who have been out of work so long that they have stopped looking for work. And that\u2019s a huge number of people. And the reason that they are able to give up is that we are now up to 99 weeks of unemployment compensation. <\/line><\/p>\n

We\u2019re paying people four years to not work. And we\u2019re paying them enough that they\u2019re all eating and drinking pretty much what they want, which is the primary reason anybody works, that and shelter. So we\u2019ve got college graduates, Millennial age graduates who cannot find any openings in their careers of choice. We have more people\u2019s jobs being converted from full-time to part-time so that their businesses do not have to provide them with health care, which forces them into a government or state exchange. It\u2019s a total mischaracterization to portray what\u2019s happening economically in this country as this roaring rebound recovery. It isn\u2019t. <\/p>\n

To the extent that the US economy is rebounding is a testament to the American people, not government policy. The policies in place in the last six years are punitive when it comes to work and they\u2019re punitive when it comes to business. Let me illustrate this for you. I\u2019m gonna give you some tax increases that went into effect on January 1st. Now, many of these you will not be aware of yet. Many of these will not hit you until you either file your tax return next year, or if you are an independent contractor and file quarterly, then you\u2019re gonna find out in April how you\u2019re getting socked. <\/p>\n

The top Medicare tax has just gone from 1.45% to 2.35%. Let me explain the Medicare tax. The Medicare tax is on top of your Social Security payroll tax, which is FICA, on your pay stub or your direct deposit form. And there is a ceiling on salary that is deducted, where payroll taxes are deducted. I don\u2019t know what that ceiling is. But at that point — I\u2019m gonna make up a number, and it may be close. Let\u2019s say it\u2019s $125,000 a year. Every dollar above that you earn, you no longer have that deduction, whatever the number is. <\/p>\n

Now, most people probably never reach the ceiling, but a lot of people used to. Medicare\u2019s on top of that and there\u2019s no ceiling. It is now 2.35% on every dollar you earn, there\u2019s no matching, like there is on FICA. You know, that\u2019s a myth anyway. The Social Security tax supposedly is 13, 14%. You pay 7%, your employer pays seven. See, you spread the burden. In essence you\u2019re paying it all. And the way that works is, that\u2019s what it cost to hire you. <\/p>\n

The employer\u2019s not matching anything. You\u2019re just not seeing that income that\u2019s being taxed. But you\u2019re paying it. The employer isn\u2019t paying a thing. I know on paper it\u2019s made to look like the employer\u2019s matching your Social Security, but it\u2019s what the employer has to pay in total to hire you. So there is no match. You\u2019re paying it all. It\u2019s costing you. <\/p>\n

\"original\"Now, Medicare, if you\u2019re an independent contractor, you pay this new 2.35% on every dollar you earn. There is no ceiling to this. It\u2019s not just ICs, but it especially hits them hard. The only way that you can change that is to classify a portion of your income as something other than ordinary income, which is why a lot of independent contractors file as Subchapter S corporations and pay themselves a salary. So let\u2019s say a small business, a Laundromat or a dry cleaner, just to pick one, and I\u2019m gonna make up numbers. I\u2019m not even attempting to get close here. <\/line><\/p>\n

Let\u2019s say a dry cleaner owner, an individual files as a Subchapter S corporation, which means many things, but among them the entire amount of income the dry cleaning firm takes in is X, but he can designate only so much of that as salary, and the rest of it as bonus. That\u2019s not ordinary income, so that\u2019s one of the ways that you can avoid paying all Social Security tax, and it\u2019s legal. It\u2019s set up. John Edwards made a big deal out of. He did this. It\u2019s totally legal. You shouldn\u2019t be critical of people that do it. But not everybody can file as a subchapter S. A standard employee cannot do it. You really do have to be self-employed or independent contractor. <\/p>\n

In addition to the Medicare tax going up, which is a biggie, but these things all add up together. This is just the first one. The income tax bracket, the top income tax bracket, as of January 1st, goes from 35 to 39.6. The top income payroll tax goes from 37.4% to 52.2%, meaning the ceiling comes way down. Capital gains, 15% to 28%. Now, as a percentage increase, that is huge. It\u2019s almost a 100% increase, and the impact, therefore, on people who pay it is gonna be profound. <\/p>\n

\"original\"When Obama was told that one of the greatest sources of revenue to the Treasury was the capital gains rate at 15%, people were happy to declare gains if they could keep 85 cents of every dollar they earned. That\u2019s the theory of lowering taxes. You tell me I got to keep 85 cents of every dollar? Okay, I\u2019ll report every dollar I earn. I won\u2019t shelter it, I won\u2019t charity it, I\u2019ll report it. <\/line><\/p>\n

Well, that caused revenue to flow into Washington like they hadn\u2019t expected, \u2019cause of the dynamics, they never interpret. So Obama said, okay, I\u2019m gonna raise it 28%. People said, “You\u2019re gonna reduce the amount of revenue you raise.” Obamas said, I don\u2019t care. This is about fairness. It\u2019s not fair that some people should only be paying a 15% tax rate. <\/p>\n

But the 15% tax rate is on the sale of assets. It\u2019s not income, it\u2019s not what you make at your job. It\u2019s from the sale of a house or a stock, bonds, what have you. And the low rate promotes investment. Raising this rate is going to end up being punitive and it\u2019s gonna have a negative impact on economic activity and money collected in the Treasury. <\/p>\n

The dividends tax. This on top of capital gains. Dividends tax, 15% to 39.6%. What this means is that there will be fewer dividends paid, which means less return on investment to shareholders, in a convoluted way. <\/p>\n

The estate tax went from 0% to 55% as of January 1st of this year, and there\u2019s one thing I want to tell you about all these taxes, every one of these. Every single one of these tax increases — and by the way, these do not include the Obamacare tax increases, which, in addition to your deductibles being up sky-high, and your out of pocket being up sky-high, there are taxes galore associated with Obamacare that you will slowly stumble into during the course of the year as your activity forces you up against these new taxes. But every one of these tax increases I just mentioned were all passed with only Democrat votes. <\/p>\n

Not a single Republican voted for these tax increases. <\/p>\n

Every one of these taxes is part of Obamacare. Every one of these tax increases I just mentioned to you is part of Obamacare. Medicare tax up to 2.35%, top income tax bracket, up to 39.6. This is how they got it passed. They put all these tax increases in Obamacare and then they played all these games to get it passed. Not one Republican vote for any of these tax increases. <\/p>\n

Now, you might come across the news that the Republicans are gonna be beating their chests like Tarzan, “Hey, we just really made a big dent in Obamacare. We\u2019re gonna succeed in getting rid of the medical device tax.” It was gonna fall anyway, but don\u2019t be fooled. Do not fall for the trick that that means Obamacare\u2019s on the way to being repealed. It\u2019s a smoke screen effort to make you think serious action is being taken against Obamacare. So far, no indication that any is. <\/p>\n","protected":false},"excerpt":{"rendered":"

RUSH: Ft. Lauderdale. This is Paul. Great to have you on the program, sir. Hello. Hey, what\u2019s happening, what\u2019s up, what\u2019s going on, hello? CALLER: Longtime listener, first-time caller. I\u2019m so glad I was able to get through to you. RUSH: I\u2019m glad you made it. CALLER: Thank you so much. 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