Obama threatens middle class mortgage interest deduction
Still think President Barack Obama champions the middle class in their ongoing struggle to overcome the mess he inherited from Bush as he demands the raising of tax rates only on those earning over $250K/year? Well, it seems that the mess his re-election bequeathed has him threatening to raise taxes on middle class homeowners. In response to a question on Twitter asking if homeowner deductions were at risk, the President tweeted:
“Breaks for middle class [important] for families & econ. If top rates don’t go up, danger that middle class deductions get hit.”
Danger? Deductions for home mortgage interest under present law are allowed for home loans up to $1M. Unlike the December 31, 2012 sunsetting provisions of the laws concerning income tax rates, payroll (FICA) tax rates and the Alternative Minimum Tax; deductions for home mortgage interest, charity and state and local taxes are presently “permanent”. Therefore, the only “danger” that any of the deductions most depended upon by the middle class could get “hit” is if President Obama signs a bill hitting them. If, in the unlikely event the Republican House and Democratic Senate were to pass such a bill the Chief Executive could veto the danger. Only an even more unlikely 2/3 majority of both houses could then hit the middle class via a veto override.
Republicans in the House will not propose reducing the mortgage interest deduction to hit the middle class. None in Congress have ever proposed it, nor did Mitt Romney in his failed campaign.
Given these facts, we can only interpret Barack Obama’s tweet as another one of his gratuitous threats on the order of those made threatening to refuse to pay the military and Social Security beneficiaries in the event of a government shutdown during the Debt Ceiling crisis last year. The deal that averted crisis (America’s credit rating was lowered despite the deal) included the sunset laws that are now characterized as the “fiscal cliff.”
President Obama insisted then, as he has every year of his presidency, that tax rates automatically rise absent future deals. Spending, on the other hand, can’t be cut absent a deal, unless it concerns a military he refuses to employ even when U.S. consulates are under siege. Think such priorities champion the middle class? Neither do we.
For the record, we oppose any downward change in home mortgage interest deduct-ability given that ALL home prices presently factor in current law. Fewer houses will be built by would-be middle class laborers if the “rich” are attacked. Underemployment remains at Depression level rates today in an economy that is barely growing. History teaches that only if the housing market rebounds will America ever have a chance for a recovery worthy of the name and an eventual return to the prosperity to which we have been accustomed during most of our history.
We are convinced that President Obama cares not if tax rates rise in the New Year, but that he does care about who gets the blame. Given Election Day exit polls that found a majority of voters blaming former President George W. Bush for our ongoing economic woes four years later, Obama knows that it is not impossible to fool significant numbers of our economically ignorant electorate.
The best way for Republicans to combat this Democratic Party president’s permanent blame game campaign would be for them to:
- Pass a bill making the reduced payroll tax rate permanent (there is no Social Security lock box anyway);
- CUTTING (not merely retaining the so-called Bush tax cuts, partial h/t to Mark Levin) tax rates for the middle class;
- Send the bill to Democrat Senate Majority Leader Harry Reid; and
- Go home for Christmas secure in at least co-Champion of the Middle Class status.
Odds are that the mess Obama inherited from Obama already has us on a path to a Double Dip recession, even if the fiscal cliff is averted. You can’t attack small business for four years (six including the Democrat Congress elected in 2006) and avoid natural law with puny measures.
The only way Republicans could avoid blame in the liberal media would be if they all became Democrats, but the GOP has won elections in the past despite media bias and they won’t motivate their natural constituencies, including the middle class by making a deal abandoning the economic principles that form the basis for their viability. In the meantime, why not make their own bold move casting the Democrats as the enemy of those they claim to champion, rather than just saying they merely disagree with their “honorable” friends across the aisle.
“One man with courage makes a majority.” – Andrew Jackson
Editor – Hillbilly Politics
Co-Founder and Editor – Political Daily
Atlanta Law & Politics columnist – Examiner.com