Scare Tactics of the Wall Street Journal

In recent years the Republicans have been losing much of their traditional support among the upper middle class as their economic programs have benefited only the ultra-wealthy. The Wall Street Journal, along with other conservatives, have been trying to scare such voters into voting Republican with misleading claims about Obama’s tax policies, especially on Social Security. For example, today they write:

He has vowed, for example, to erase the Bush tax cuts not only for those who make more than $250,000, but to end the cap on Social Security taxes, which amounts to a tax hike on anyone who makes more than $100,000 in income. More recently, Austan Goolsbee, an Obama economic adviser, told me the new cap might be set at $200,000.

All of this has caused some heartburn among certain Democrats in high cost-of-living states. New York Rep. Joseph Crowley says a couple with earnings of $100,000 could be “a police officer and nurse.” “In New York City,” he adds, “they’d be struggling.”

There are several misleading statements here. First of all, Obama has not called for raising the cap on everyone earning over $100,000. He has spoken of using a donut hole so that this tax increase only affects those at a higher income level, such as those making over $250,000.

A second error in this is that Social Security taxes are based upon individual not joint income. Therefore the couple he describes would not be affected based upon their joint earnings of $100,000.

There is yet a third misleading aspect of this. John McCain has also supported increasing the cap (as has Hillary Clinton). It doesn’t appear to matter who is elected with regards to this issue.

There is one place where they are correct. Repealing the Bush tax cuts for the wealthy will not pay for all the programs which the Democrats are proposing. However that is nothing new. The Republicans have been supporting programs which exceed our tax revenues for years. John McCain’s proposed military spending cannot be supported based upon current tax revenues, and he has been quite vague as to how he would cut spending to balance his proposed tax cuts.

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