Here’s President Obama in August 2009 regarding the link between tax increases, recessions, and business growth: “The last thing you want to do is raise taxes in the middle of a recession because that would just suck up — take more demand out of the economy and put business in a further hole.”
Today, in a still weak economy, raising taxes has moved from being the “last thing” to do to being Mr. Obama’s top priority.
Single-handedly, Obamacare, counting premium mandates and penalties, is likely to become the largest tax increase in U.S. history.
And that’s just the beginning. On the Obama administration’s to-do list in order to create a world that’s fairer and cleaner are higher taxes are dividends, capital gains, high-earners, interest income, overseas profits, inheritances and fossil fuels.
When President Obama delivered the aforementioned warning in August 2009 about the negative impact on business from hiking taxes during a recession, the U.S. economy was growing at a faster pace than this year’s economy.
“Real GDP increased 3.5 percent in the third quarter of 2009,” reports the Commerce Department’s Bureau of Economic Analysis.
This year’s economic growth, in contrast, makes the August 2009 quarter look good. The Bureau of Economic Analysis reports that “real GDP in the United States expanded 2.0 percent in third quarter of 2012” and “1.3 percent in the second quarter of 2012.”
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Ralph R. Reiland (photo) is an associate professor of economics and the B. Kenneth Simon professor of free enterprise at Robert Morris University in Pittsburgh.