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What if Obama cut taxes, and nobody noticed?

When surveyed whether Obama had raised or lowered taxes, less than 10% respond that Obama has lowered their federal taxes. And yet, since entering office, Obama lowered taxes for over 90% of the population.

Making this even more ironic, those tax cuts were part of the stimulus bill, a bill which right-wingers routinely attack while simultaneously calling for more tax cuts.

One reason people didn’t notice the tax cut was because rather than sending out a tax rebate check with great fanfare, they purposely designed it to lower withholding in people’s paychecks. While rebate checks may make for good politics, they don’t help the economy as much since people are more likely to put a single check into savings, while an increase in the size of their paycheck is more likely to be spent, stimulating the economy.

Obama purposely did something that was better for the economy, but worse for his own politics. And yet the pundits (on both sides) attack him for not being more political. Which would you rather have — a president who is actually trying to solve our economic problems, or a leader who does things that sound good, but don’t work as well? I’m afraid that the midterm elections will demonstrate that Americans stupidly prefer the latter.



  1. Jason Ray wrote:

    I’m afraid I agree that the majority of voters seem to prefer sound bites over substance. Of course, that’s all they are provided by the media and political outlets.

    Getting politically educated these days is like any other form of public education – in order to really learn anything you have to ignore the official channels and do your own research, which the majority of people find too difficult and time consuming.

    I guess this is why there is a saying, “Democracy is the form of government in which everybody gets what the majority deserves!”

    Tuesday, October 19, 2010 at 2:06 pm | Permalink
  2. Sammy wrote:

    IK, ask the average person (voter or not) what their effective tax rate is and chances are they won’t have a clue what you’re asking. If you clarify by saying, “the federal income tax rate you pay as a percentage of your gross income” they’ll likely (and erroneously) say “15%”, not realizing that no one is taxed on every dollar they make (because of deductions, exemptions, credits, etc.).

    What they do “know” is that they’re taxed “too much”. I have an acquaintance who rails against the government constantly and has a never-ending mantra about redistribution of wealth. He thinks we’re taxed too much and favors a flat tax. When I pointed out that unless that flat tax is somewhere around 5% or 6% he’s probably going to see a substantial tax increase he first ignored the point. Then when confronted again he conceded that would be the case, but it would be okay with him to give more of his money to wealthier earners. He doesn’t mind redistributing his wealth upward. Oh, and he’s a public school teacher.

    Tuesday, October 19, 2010 at 4:08 pm | Permalink
  3. ZJD wrote:

    The point has often been made that there is a disconnect between what Obama does and the credit people afford him for doing it. In other words, his actions do not accrue political capital, even among liberals who support him. The more I delve into the current political climate in this country, the more I realize there is much more to it than that. The average American voter has a complete disconnect with reality.

    Tuesday, October 19, 2010 at 5:46 pm | Permalink
  4. ebdoug wrote:

    Wonderful article in Christian Science Monitor on how much more Obama has been able to do than FDR. That Obama is the “real deal” That the thing that saved FDR was world war II. The Republicans know that Obama is doing right by the middle class. Rove and his thugs are doing everything they can to refute that.

    Re: taxes. Even after deductions, etc, the first part of your income is only taxed at 10%. People in the 25% bracket only pay part of their income in the 25%, not all. Only way to figure it out is divide your tax assessment by taxable income (or the other way around) My turbotax would tell people the effective Federal Rate. I had to figure it for the state to show them. I explained this over and over and over. People would get huge refunds because they had too much taken out. I’d have to show them they left something behind.

    Tuesday, October 19, 2010 at 7:53 pm | Permalink