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Obama on the Economy
Sep. 17th, 2008 01:27 pmAs I mentioned yesterday, I was going to try and provide some positive reasons to vote Obama. I was planning to do foreign policy first, but with the Federal Reserve's takeover of AIG ($85 billion for an 80% stake in the company), the economy is front of mind. So, let's talk economics.
The current credit crunch
Let's get the AIG / Lehman / Bear Stearns mess out of the way first. What we have here is something that was very common in the 1800s - a financial panic. Back then, every few years a major bank or investment company would crater, and drag down the rest of the economy. Now, thanks to regulation, we've had less of these panics, and are able to resolve them in a more orderly fashion.
Unlike a lot of Obama supporters, I'm not sure there is much we could have done to prevent the underlying cause of this panic, namely the housing bubble. I think Megan McArdle's post summarizes the problem best. Having said that, John McCain has a long record of deregulation (Google "McCain deregulation") so his sudden "let's crack down on greed" plan has even the Wall Street Journal shaking their heads in disbelief.
Obama on taxes
Obama is offering a tax cut to the vast majority of people, as well as reducing capital gains taxes on small businesses. In fact, if you are in the tax bracket which holds the US median income ($37,000 to $66,000) you will be a bigger tax cut under Obama then under McCain! See his policy here.
Now, McCain people will tell you that Obama's tax plan is bad because many high income individual filers are actually small business owners who are paying out the profits of their businesses as salaries. Well, if that small business owner makes less then $603,402, their taxes don't go up! If they make less then $226,981 a year, they get a 1.9% tax cut. I worked at a small business, fairly profitable, and the owner employed 12 people, He made less then $300K salary, so trust me, Obama's plan will not hurt small businesses.
You really should visit this site if you're interested in taxes. Whoever runs this site has laid out the two plans graphically and to scale. Done that way, it's clear that Obama's plan benefits more people with more money then McCain's plan.
I'll I have updated this page with links to the next postings, on foreign policy and health care.
The current credit crunch
Let's get the AIG / Lehman / Bear Stearns mess out of the way first. What we have here is something that was very common in the 1800s - a financial panic. Back then, every few years a major bank or investment company would crater, and drag down the rest of the economy. Now, thanks to regulation, we've had less of these panics, and are able to resolve them in a more orderly fashion.
Unlike a lot of Obama supporters, I'm not sure there is much we could have done to prevent the underlying cause of this panic, namely the housing bubble. I think Megan McArdle's post summarizes the problem best. Having said that, John McCain has a long record of deregulation (Google "McCain deregulation") so his sudden "let's crack down on greed" plan has even the Wall Street Journal shaking their heads in disbelief.
Obama on taxes
Obama is offering a tax cut to the vast majority of people, as well as reducing capital gains taxes on small businesses. In fact, if you are in the tax bracket which holds the US median income ($37,000 to $66,000) you will be a bigger tax cut under Obama then under McCain! See his policy here.
Now, McCain people will tell you that Obama's tax plan is bad because many high income individual filers are actually small business owners who are paying out the profits of their businesses as salaries. Well, if that small business owner makes less then $603,402, their taxes don't go up! If they make less then $226,981 a year, they get a 1.9% tax cut. I worked at a small business, fairly profitable, and the owner employed 12 people, He made less then $300K salary, so trust me, Obama's plan will not hurt small businesses.
You really should visit this site if you're interested in taxes. Whoever runs this site has laid out the two plans graphically and to scale. Done that way, it's clear that Obama's plan benefits more people with more money then McCain's plan.
