RUSH: Another extensive look at Obama’s budget. It is just amazing how destructive this is for years and years and years. This is truly a problem. For example, the charitable deduction will be gone in 2011. The charitable deduction will be gone. The mortgage interest deduction will be taken away from some people. The mortgage interest deduction will be taken way and/or limited for upper income people, the $250 grand and higher. That’s on the table. We’ll have to wait and see how much of this Congress actually approves. But when it comes to the charitable deduction, right now the top payers and the most philanthropic, obviously, get to deduct 39.6% of every dollar they donate. That will be taken away in toto. Obama wants the government to be in sole charge of charity. He wants everybody thanking him for whatever philanthropy goes on in the country. We’ll get to all that stuff in great detail.
And there’s a funny thing today, Reuters actually has a story entitled: ‘Backdoor Taxes to Hit Middle Class.’ Not just the rich. The rich tax increases are up front and center. The middle class is gonna get robbed, and they will not know it. ‘Backdoor Taxes Hit Middle Class.’ But the White House got hold of Reuters and said, ‘That’s not true. It is outrageously false.’ And so Reuters has withdrawn the story because the truth is not to be tolerated in the Obama administration.
BREAK TRANSCRIPT
RUSH: Here it is: ‘Backdoor Taxes to Hit Middle Class.’ The story was posted last night at 8:07, I think. Maybe that’s when they withdrew it. Anyway, the Obama White House got hold of State-Controlled Reuters and said the truth is not to be tolerated here. And so Reuters has withdrawn the story and says that a replacement story will run later this week. So what is this story the White House was so concerned about? Here it is: ‘The Obama administration’s plan to cut more than $1 trillion from the deficit over the next decade relies heavily on so-called backdoor tax increases that will result in a bigger tax bill for middle-class families. In the 2010 budget tabled by President Barack Obama on Monday, the White House wants to let billions of dollars in tax breaks expire by the end of the year — effectively a tax hike by stealth. While the administration is focusing its proposal on eliminating tax breaks for individuals who earn $250,000 a year or more, middle-class families will face a slew of these backdoor increases.’
Here’s why. ‘If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent.’ This is what they all were before Bush cut them. ‘The special 10 percent bracket is eliminated.’ This is all true. Every bit of it is true. If you’re going to let these tax cuts sunset, it means we’re going to go back to what they were before Bush cut them, and those are the rates that I just gave you. That means that everybody paying income taxes is going to effectively get an increase, a tax increase, despite Obama’s constant pledges that 95% of the American people get a tax cut, and he’s calling one-time tax rebates a tax cut. So obviously the White House did not like this story. It is curious how this story ended up at State-Controlled Reuters. I mean Reuters goes out of its way to propagandize for the administration.
Something’s happened here. So the administration — probably Gibbs — got on the phone and said (imitating Gibbs) ‘This is outrageously false, you gotta pull the story.’ And Reuters dutifully complied. We’ll keep a sharp eye to see what the replacement story is later this week. These are not all the changes on the table. ‘Investors will pay more on their earnings next year as well, with the tax on dividends jumping to 39.6 percent from 15 percent.’ That hits the middle class, too. The middle class own stock. The middle class sometimes own stock that pays dividends. Hell, that’s more than a hundred percent increase, 15% to 39.6%. ‘The capital-gains tax increasing to 20 percent from 15 percent. The estate tax is eliminated this year.’ The estate tax is gone, for just this one year, 2010. So if a member of your family dies, say your mother or father, grandfather or whatever, it’s all yours, whatever the inheritance is, it’s all yours. But next year, in 2011, ‘there has been talk about reinstating the death tax,’ and the Democrats are talking about reinstating it even sooner, this year, and not waiting for 2011.
Now, this produces all kinds of morbid thoughts. I can see Snerdley’s mind is turning. His eyes are just rotating and flashing back and forth in there. And, yes, I am fully aware, I personally am aware — I’m not going to tell you how many — of people who have done everything they could to sustain family members on life support to 2010 because the estate tax is 55%. It’s pure redistribution of wealth. Don’t forget, Warren Buffett is all for the estate tax. There are a lot of rich liberals who amazingly are. ‘Millions of middle-class households already may be facing higher taxes in 2010 because Congress has failed to extend tax breaks that expired on January 1, most notably –‘ get this, now, this is something that irritates and more people every year. ‘– a ‘patch’ that limited the impact of the alternative minimum tax. The AMT, initially designed to prevent the very rich from avoiding income taxes, was never indexed for inflation. Now the tax is affecting millions of middle-income households, but lawmakers have been reluctant to repeal it because it has become a key source of revenue.
‘Without annual legislation to renew the patch this year, the AMT could affect an estimated 25 million taxpayers with incomes as low as $33,750 (or $45,000 for joint filers). Even if the patch is extended to last year’s levels, the tax will hit American families that can hardly be considered wealthy — the AMT exemption for 2009 was $46,700 for singles and $70,950 for married couples filing jointly. Middle-class families also will find fewer tax breaks available to them in 2010 if other popular tax provisions are allowed to expire. Among them: Taxpayers who itemize will lose the option to deduct state sales-tax payments instead of state and local income taxes; The $250 teacher tax credit for classroom supplies; The tax deduction for up to $4,000 of college tuition and expenses; Individuals who don’t itemize will no longer be able to increase their standard deduction by up to $1,000 for property taxes paid; The first $2,400 of unemployment benefits are taxable, in 2009 that amount was tax-free.’
They’re taxing the first $2,400 of unemployment benefits starting this year. This year — and, by the way, if you doubt me, go to the people in your company who do payroll and just ask them, tell ’em I told you to ask ’em if when 2010 rolled around they had new withholding instructions to withhold additional funds from for your paycheck, because there are. So the White House is clearly not happy that this story is out there. Reuters has dutifully withdrawn it. But all of this is true. Every aspect of this is true. There’s nobody in the country who will escape tax increases. It’s impossible with this irresponsible, insane, lunatic budget. And, folks, there are $1 trillion deficits for ten years, $1 trillion deficits, annual deficits for ten years. Do you understand that? We’re gonna get to the point here where it’s possible that it will not be possible to fund our debt, even with worldwide investors buying it. There’s going to be that much of it.
Obama is just spending and spending and spending, and, by the way, James Clyburn, the head honcho of the Congressional Black Caucus says we can only spend our way out of the recession. There’s only one way to do it, and that’s spend our way out of it. Now the Investor’s Business Daily today in a story by Jed Graham: ‘Higher Taxes for All in Obama Budget — After cutting taxes for 95% of working families in his first year, President Obama has proposed a budget that would raise taxes on 100% of them.’ So whereas Reuters, under pressure, has withdrawn its story, Investor’s Business Daily has not.
BREAK TRANSCRIPT
RUSH: Oh, by the way: ‘Backdoor Taxes Hit Middle Class,’ the Reuters story, is still up on the Washington Post website. It’s still there. Reuters may have pulled it but the Washington Post has it. I’m just giving you people at the White House a little help here, because you got Reuters to pull it. It’s the headline they don’t like. They couldn’t care less about the story. It’s the headline: ‘Backdoor Taxes to Hit Middle Class.’ That’s probably what they don’t like. The story won’t have many changes, but it will have a headline change like: ‘Rich to Get Soaked, Bankers Especially Hard Hit by Obama Tax Hikes in New Budget.’