I’ve already bragged that the Cato Institute is America’s best think tank, highlighting the fact that we took the lead in battling against Obama’s faux stimulus at a time when many were dispirited and reluctant to fight big government.
I’m biased, of course, so I’ll understand if you discount what I say. But I hope you’ll agree that my colleagues have put together an excellent video response to the President’s state-of-the-union speech.
As part of my contribution to the video, beginning around 6:35, I debunk the President’s class-warfare tax agenda by citing IRS data from the 1980s to explain that higher tax rates don’t necessarily mean higher tax revenue.
After a night’s sleep, here are a few additional observations on the President’s remarks.
- I was disappointed, but not surprised, that he repeated the economically foolish assertion that Warren Buffett pays a lower tax rate than his secretary.
- I also was not surprised that he didn’t say much about jobs and the economy. These four charts show he doesn’t have much to brag about.
- It was also noteworthy that he didn’t spend much time talking about Obamacare, which suggests that White House pollsters understand that government-run healthcare isn’t very popular.
- It was equally revealing that he didn’t spend much time on the so-called income inequality issue. Redistribution was implicit in what he said, to be sure, but the Occupy-Wall-Street crowd is probably disappointed that he didn’t explicitly embrace their agenda. More evidence that the pollsters played a big role in this speech.
- I’m definitely not surprised that he talked about eliminating Osama bin Laden. Kudos to the Commander-in-Chief.
- I was amazed that he had the gall to say “no bailouts,” particularly given his support for TARP, the Dodd-Frank bailout bill, and the giveaway to GM and the auto unions. And if the GM bailout is supposed to be a success, I’d hate to see his definition of failure.
- And I was stunned that he could talk about the housing meltdown and mortgage crisis without mentioning the Federal Reserve, Fannie Mae, or Freddie Mac. Sort of like analyzing World War II and pretending Germany and Japan didn’t exist.
Since most of the previous observation are critical, I want to stress that I’m not being partisan. I also was disappointed in the Republican response. Was the GOP smart to showcase a governor who was part of the big-spending Bush Administration? Especially one who has said nice things about the value-added tax?
I even was a bit disappointed in Governor Daniels’ remarks. He focused a lot on means-testing for entitlements, but that’s the wrong way of reforming the programs. Such policies impose higher implicit marginal tax rates on people who save and invest during their working years.
If we’re going to reform entitlements, do it the right way.
One of our blog members who is an Obama supporter reacted to the suggestion that America’s role as the world leader has not waned. As an expat, a target of a tax clamp down, his ability to see Obama’s point is tainted. Alienating a million US expats in Canada, and six million world wide–how does that help America’s leadership in the world? See The State of the Union from an expat’s perspective
Thanks for this post, keep up the good work.
Peter W. Dunn, Isaac Brock Society
[…] He proposed several small programs that he says will strengthen the economy. These include the elimination of tax incentives for companies to move jobs overseas. He also has brought back the tax credit for college costs proposal that we saw last year. Finally, he wants to expand financial help for creditworthy homeowners looking to refinance their mortgages at lower rates. All of these are admirable and should receive thourough consideration in the Congress if they are deemed important enough to spend resources on. The Cato Institute takes issue with a number of the President’s statement in the video. […]
[…] The Cato Institute responds. […]
[…] CATO responds Hotair comment section […]
[…] AMERICA’S BEST THINK TANK: The Cato Institute Responds To President Obama’s State Of The Union Address. […]
You can’t judge Daniels by his one-time association with the Bush administration. That’s incredibly foolish. Judge him by his stellar record in Indiana, such as his keeping the state in the black throughout the recession, his devotion to avoiding wasteful spending and taxation, and — what may seem small but surely most impresses Hoosiers — his complete reformation of the state Bureau of Motor Vehicles from something comparable to the first level of hell to something so prompt, speedy, and efficient that it is almost a pleasure to visit.
I tend to agree with Alexander about Daniels; let’s not make the perfect the mortal enemy of the good. A VAT is an awful idea, to be sure, but Cato itself has pushed for something not too different in a national sales tax (granted, coupled with the elimination of the income, payroll, corporate and other taxes). Speaking as an irresponsible, right-wing hater myself, I’d be delighted to get 80% of what I want and live on to fight another day for the other 20%. One step at a time, Dan.
Good column, great video.
[…] “The Cato Institute Responds to President Obama’s State-of-the-Union Address,” by Dan Mitchell, January 25, 2012 […]
$400,000 spent [and increase to debt] per $40,000/year “job created.”
Warren Buffet’s tax is effectively 44%, not 15%; Obama proves himself to be an economic simpleton for failing to see the overall picture.
The Republican Party needs devastating headlines, sound bites, and talking points. The first one is excellent and I’ve seen it flabbergaster Democratic spokes people.
This is a battle for the future of the USA and I think the earth. In the 1980s there was Thatcher in fact leading the way and fighting for economic success along side Reagan. The US President is “standing alone” now.
If unemployment slides to 8% or maybe even just remaining at 8.6% or lower and growth continues apace, Obama may win and that is a disaster.
Why are you surprised at the Republican Party’s choice of Daniels? That party never does anything right. If the Democrat party were just a little less left, there’d be no Republican party.
Even if Obama had asked the Republicans to write his SOTU address and said exactly what they like to hear, republicans would still come out and criticize him. It is just a game. They don’t care for the country. We saw 8 years of GOP rule ( 6 with majority in congress ) and that brought us 9/11, Iraq war, the great recession, the bailouts, wall street excesses, massive budget deficits ( with GOP said don’t matter at that time). So GOP can’t claim to be the party that can bring the country back on track.
Wow Mitch! Repeating a lie that Ari Fletcher used? Usual Cato institute half-truths? http://www.thefinarts.com/2012/01/19/high-tax-burden-for-the-wealthy/
How exactly did the GOP cause 9/11?
And since the huge spending run up started in 2006 after the Democrats gained control of the Congress and the Senate, how is the GOP involved, exactly? Bankers helping themselves to “stimulus” monies is Wall Street excess, but the money was pushed out by the Democrat administration (you really need to use a calendar before making claims about who did what).
Oh and BTW, since the executives at “Freddie and Fannie” were raking in compensation packages of up to $100 million (of your tax dollars) while backing worthless subprime mortgages (with your tax dollars), it is OK because they were working for the government?
Obama basically said:
Flatter effort-reward curves lead to greater prosperity.
But if you don’t believe that,… still…, flatter effort-reward curves are more “fair” and thus take priority over overall prosperity — the relentless compounding for slow growth rates be damned (it takes a few years for those to kick in anyway)
And if you don’t believe that, then… don’t worry, the growth deficit will be made up for by the …greater economic efficiency of central planning.
And if you don’t believe that either,… we get our pitchforks out and force you to comply.
We smell that someone somewhere has money, and some of it can be had with a simple vote (at least what will be left of it after corruption, waste, abuse and payment of cronies – which are still minor factors in America, but you have not seen even the middle of the Euro-movie of HopNChange yet). So the moral justifications for taking the money, wherever it may, be will be found, just like the moral justifications were found to make Socrates drink hemlock, crucify Jewish prophets etc.
If you don’t pay voluntarily, we’ll confiscate your bank account.
If you refuse to do that,…we take your house.
If you refuse to do that yet,… we send our police forces to evict you.
If you resist that too,… we have the constabularies arrest you.
If you resist that too… we have the police physically subdue you, separate you by force from your family and throw you in jail.
So the bottom line is: This is mandatory compassion and participation must inevitably be enforced by cruel actions. You must participate and you must share. If you disagree or resist to anything we believe, there will simply be an escalation of force until we throw you in jail. Because we’re the majority of a declining America and we never give up – no matter how small our benefit and how big your respective harm – no matter if we kill the golden gooses and decline. We’re HopNChange, the righteous enforcers of mandatory compassion — and this is how we decline.
—————————————
Even much more sophisticated publics in Europe bought that rhetoric long time ago. Why does anyone think that Americans will not succumb to the same inebriating message? The redistribution and central planning shortcut to prosperity?
Save a few pockets of intelligent Americans who really understand where America derived its prosperity from, the rest have either bought into HopNChange or are still hanging on to American values without rational justification, out of historical momentum and some concept vaguely described as “tradition”. It is only a matter of time until the American fry-over state simpletons (who unbeknownst to them hang on to the only way middle class Americans can actually maintain their 6x average world living standards ) finally become more “enlightened” and buy the message of HopNChange — like every single one of their brethren European cultures have – and join them into decline.
When you fail to realize what you have – and put it on a rational basis – you are bound to lose it.
So long America it was nice to have known you.
Basically Obama nailed the coffin of America’s prosperity with a single bill: Obamacare. The arrogant statist Bush built the coffin by squandering America’s already narrowing competitive advantage into high cost/benefit ratio wars and other statist programs in the name of neo and (mandatory) compassionate conservatism.
But Bush’s mistakes were very different than Obama’s mistakes. Bush’s mistakes were REVERSIBLE. After all, Iraqis and Afghanis don’t vote in America, so it is rather easy to pull out once Americans realize their costly mistake. Not so with domestic welfare programs. ObamaCare blew the healthcare market its final fatal distortion which will end with nationalization of medicine. From that point on, the vicious cycle, reinforced also by other effort/reward flattening measures will take a life of its own.
Years from now, when the American standard of living will be much closer to the worldwide average, even Republicans will talk about ObamaCare with the same untouchable attitude that they talk about Social Security and Medicare today. Republican leaders of the future will be Sarkozys and Merkels. As ObamaCare eventually evolves into socialized medicine, it will be mentioned (even by republicans) as one of the three basic untouchable safety nets, together with Social Security and Medicare. By then Americans will have been engulfed in a catch-22 euro-mentality of decline and America will have stopped being the prosperous outlier nation it once was — in a few short decades.
But stay tuned !
Save a higher unemployment rate, decline can be fun for a few final years until compounding low growth starts inexorably and irreversibly suppressing standard of living in a suicidal tailspin of ever more desperation, redistribution, central planning and father decline.
By frantically thrashing in the waters, the drowning man drowns himself. Americans leaped into the water in 2008.
[…] via Dan Mitchell’s International Liberty This entry was posted in Kewel!. Bookmark the permalink. ← EarthFucker Bumper Stickers […]
[…] He proposed several small programs that he says will strengthen the economy. These include the elimination of tax incentives for companies to move jobs overseas. He also has brought back the tax credit for college costs proposal that we saw last year. Finally, he wants to expand financial help for creditworthy homeowners looking to refinance their mortgages at lower rates. All of these are admirable and should receive thourough consideration in the Congress if they are deemed important enough to spend resources on. The Cato Institute takes issue with a number of the President’s statement in the video. […]
[…] already posted the Cato Institute’s overnight response to the President’s state-of-the-Union […]
[…] The Cato Institute Responds to President Obama’s State-of-the-Union Address […]
The state of the Union? The US is like the Titanic on a fiscal voyage to utter
destruction. I nearly gagged over Daniels emotionless response to Obama’s disingenuous blame game bag of excuses, his ridiculous attempts to evade the
blame for his own hideous executive management decisions. I was shocked at
Obama’s statement that he was going to open federal land to energy exploration; that is the diametrical opposite of all his past policies. If this republic is to survive, we have to CHANGE COURSE FROM THE LUNACY OF
OUR RESOURCE MANAGEMENT. We have to cut spending, not reduce imaginery spending of an imaginery budget. So far the REPUBs have either been too GUTLESS OR too Stupid to pin the results of Democratic failures on
the Democrats who are completely (Fannie and Freddie, the insulation of Wall St before the collapse, the obscene energy prices that are draining the economy,et cetera ad nausem. If the people who are leading this country to total ruin are not confronted, we will witness the end of America as we know it.
[…] on January 25, 2012 at 8:59 am The Cato Institute Responds to President Obama’s State-of-the-Union Address « International Liber… […]