IT’S A TAX INCREASE!!
The current description of the negotiations regarding increasing the debt limit is a fallacy. We are not negotiating to increase the debt limit, we are negotiating to increase taxes. We may or may not increase the tax rates on some or all individuals or corporations, but raising the debt limit is still a tax increase.
Republicans, Libertarians, Conservatives and Tea Partiers better start calling this what it is: A TAX INCREASE!
Why? Let’s look at it with smaller numbers…
Let’s say the government takes $10.00 in taxes and spent all that money, but they also borrowed and spent another $1.00 for a total of $11.00. To pay off the government, citizens will pay taxes. Is the $11.00 repayment going to require more taxes? Or less taxes?
Is the extra $1.00 that the taxpayers will now have to redeem to the government a tax increase? Or a tax decrease?
Let’s try with larger numbers…
Government was authorized to collect taxes at a certain rate – say $100 per year. However, they’ve been spending $140 to $160 per year since the advent of the Obama administration. Our federal government has spent more than the authorized $100 every year since 1968… …to the point that they owe that $100 plus $5,800
If we give them another $100 on that debt limit, what do you think they’re going to do? They’re going to spend it! It will be another $100 added to the $5,800 that we already owe.
Let’s use the real numbers…
The Federal Government is currently authorized, based on tax rates, to collect about $2.1 Trillion per year. In 2009 and 2010, the Obama Administration spent $3.4 Trillion and $3.5 Trillion per year. So, in 2011, taxpayers must now pay the $2.1 Trillion authorized PLUS the additional $2.7 Trillion from the 2009 and 2010 PLUS whatever deficit spending occurs in 2011.
More Taxes; More Deficit; More Taxes; More Deficit; More Taxes.
This is not a debt ceiling increase; we better start calling it what it is: A TAX INCREASE!