Democrats Aren’t Working: $16 Trillion in Debt, and They Aren’t Done Yet

September 4, 2012

Democrats Aren’t Working: $16 Trillion in Debt, and They Aren’t Done Yet

America Is $5 Trillion Worse Off After Four Years of Obama, But Democrats Want More Tax Hikes So They Can Keep Spending

As Democrats kick off their convention today the national debt is expected to pass $16 trillion, a painful reminder of the staggering cost of the Democrats’ agenda over the last four years.
Experts have repeatedly linked rising debt levels to slower economic growth.
But four years of borrowing, spending and taxing weren’t enough for Democrats, who are now demanding job destroying new tax hikes on small business to fund four more years of their spending addiction.

As Democrats kick off their convention today the national debt is expected to pass $16 trillion, a painful reminder of the staggering cost of the Democrats’ agenda over the last four years:

“DEBT SET TO PASS $16 TRILLION AS DEM CONVENTION OPENS”: (“Debt Set to Surpass $16 Trillion as Dem Convention Opens,” Fox News, 9/2/2012)

OBAMA, TWO WEEKS AGO: “FIVE TRILLION DOLLARS IS A LOT OF MONEY, EVEN IN WASHINGTON”: (President Barack Obama, Remarks At A Campaign Event, Dubuque, IA, 8/15/12)

$5.36 TRILLION INCREASE IN NATIONAL DEBT SINCE OBAMA TOOK OFFICE: (“The Daily History of the Debt Results,” Bureau of the Public Debt, Accessed 9/4/2012)

SIZE OF NATION’S ECONOMY AT $15.606 TRILLION: (Bureau of Economic Analysis, Accessed 8/30/2012)

POLITIFACT SAID LAST YEAR THAT OBAMA WAS THE “UNDISPUTED DEBT KING OF THE LAST FIVE PRESIDENTS”: “Obama is the undisputed debt king of the last five presidents, rather than the guy who added a piddling mount to the debt.” (Louis Jacobson, “Nancy Pelosi Posts Questionable Chart on Debt Accumulation by Barack Obama, Predecessors,” Politifact, 5/19/2011)

THREE YEARS AND TWO MONTHS OF OBAMA IS MORE DEBT THAN EIGHT YEARS OF PREDECESSOR: “The National Debt has now increased more during President Obama’s three years and two months in office than it did during 8 years of the George W. Bush presidency. The Debt rose $4.899 trillion during the two terms of the Bush presidency. It has now gone up $4.939 trillion since President Obama took office.” (Mark Knoller, “National Debt Has Increased More Under Obama than Under Bush,” CBS News, 3/19/2012)

OBAMA RECORD “THE MOST RAPID INCREASE IN THE DEBT UNDER ANY U.S. PRESIDENT”: (Mark Knoller, “National debt has increased $4 trillion under Obama,” CBS News’ Political Hotsheet Blog, 8/22/2011)

Experts have repeatedly linked rising debt levels to slower economic growth:

CBO: OBAMA BUDGET WILL “HURT THE ECONOMY IN THE LONG TERM”: (Erik Wasson, “CBO Estimates Obama’s 2013 Budget Would Hit Economic Growth,” The Hill, 4/20/2012)

STUDY: ECONOMIC GROWTH TAKES 25% HIT FROM DEBT LEVELS AT MORE THAN 90 PERCENT OF ECONOMY: (Rich Miller, “Reinharts, Rogoff See Huge Output Losses From High Debt,” Bloomberg Businessweek, 4/30/2012)

GOLDMAN SACHS RESEARCH: STIMULUS SPENDING “WILL EVENTUALLY LEAD TO A DRAG,” HIGHER DEBT LEVELS TAKE ECONOMIC TOLL: “The eventual effect of sustained fiscal imbalance is slower growth and greater risk of a fiscal crisis. Our estimates suggest that a 10-point increase in the debt/GDP ratio lowers growth four years later by 0.2 percentage point, and increases the probability of a debt crisis by 2.5% in the aftermath of a financial crisis like the recent one. (See No Rush for the Exit,” Global Economics Paper, No. 200, June 30, 2010 and “When One Crisis Leads to Another,” US Economics Analyst, 11/04, Jan. 28, 2011.) To avoid this, lawmakers must begin to identify deficit reduction strategies.

“Ultimately, what goes up must come down. In the case of the federal budget, this means that a deficit-financed boost to growth will eventually lead to a drag. While policymakers can try to smooth the transition by phasing in cuts and incorporating multi-year fiscal commitments, achieving a sustainable fiscal policy will inevitably be a painful but necessary process.” (Jan Hatzius and Alec Phillips, “Fiscal Restraint: A Question of When, Not If,” Goldman Sachs Global ECS U.S. Research, 3/2/2011)

MAJOR ECONOMIC STUDY LINKS GOVERNMENT DEBT TO SLOWER ECONOMIC GROWTH: “Our main finding is that across both advanced countries and emerging markets, high debt/GDP levels (90 percent and above) are associated with notably lower growth outcomes… Seldom do countries simply ‘grow’ their way out of deep debt.” (Carmen M. Reinhart and Kenneth S. Rogoff, “Growth in a Time of Debt,” American Economic Review Papers and Proceedings, 12/31/2009)

But four years of borrowing, spending and taxing weren’t enough for Democrats, who are now demanding job destroying new tax hikes on small business to fund four more years of their spending addiction:

LA TIMES: “FOR OBAMA, IT’S RIGHT BACK TO TAXES AFTER JOBS REPORT”:(Michael A. Memoli, “For Obama, It’s Right Back to Taxes After Jobs Report,” Los Angeles Times, 8/3/2012)

TAX HIKE WOULD BE A $201 BILLION HIT TO THE ECONOMY: (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012, Appendix C)

710,000 JOBS COULD BE DESTROYED BY DEMOCRATS’ TAX HIKE PLAN: (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012, Appendix C)

1.8% DROP IN WAGES: “Real after-tax wages would fall by 1.8%, reflecting a decline in workers’ living standards relative to what would have occurred otherwise.” (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012)

JOINT COMMITTEE ON TAXATION: 940,000 SMALL BUSINESSES TO GET HIT BY DEMOCRATS’ LATEST TAX HIKE: “Congress’s Joint Tax Committee—not a conservative outfit—estimates that in 2013 about 940,000 taxpayers will have enough business income to meet Mr. Obama’s tax increase threshold.” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

MORE THAN HALF OF NET BUSINESS INCOME WILL BE HIT BY HIGHER TAX RATES UNDER OBAMA PROPOSAL: “And of the roughly $1.3 trillion in net business income, about 53% will get hit with the higher tax rates. This is because millions of businesses report their income as sole proprietors and subchapter S corporations that file under the individual tax code.” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

OBAMA’S NEW TAX HIKE WOULD HAVE SOME SMALL BUSINESSES PAYING HIGHER TAX RATES THAN GENERAL ELECTRIC AND J.P. MORGAN: “So Mr. Obama wants these businesses to pay higher tax rates than the giant likes of General Electric or J.P. Morgan. Does that qualify as ‘tax fairness’?” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

TAXMAGEDDON WILL COST AVERAGE FAMILY $4,138 IN 2013: (“Taxmageddon Costs Average Family $4,138 Next year,” The Heritage Foundation, 6/14/2012)

Democrats Aren’t Working: $16 Trillion in Debt, and They Aren’t Done Yet http://ow.ly/dsjP1#stopthetaxhike