All of a Sudden, the President Says We Don’t Have a Debt Crisis

Photo Credit: Llima

Presto, change-o! At the beginning of the year, we were sternly lectured that huge tax increases were absolutely necessary to confront our looming debt crisis. America was driven to the edge of the “fiscal cliff,” ostensibly producing business panic that explained a fair measure of Barack Obama’s permanent economic malaise, by the President’s refusal to budge an inch from his demands for those deficit-fighting tax increases.

During the previous years, the President insisted that this “payroll tax cut,” funded by a raid on Social Security, was the vital ingredient to American economic survival. He asked citizens to send him their horror stories about how losing $60 in higher taxes from each paycheck would ruin their lives. But at the end of 2012, Obama let this supposedly crucial tax cut die without saying one single word in its defense. I mean that literally – he made absolutely no effort to protect it during “fiscal cliff” negotiations. The urgency of deficit reduction through tax increases was simply too great!

Throughout the 2012 campaign, every proposal for growth-inspiring tax cuts, and every serious effort at reforming America’s embarrassing tax system – from Mitt Romney’s relatively modest proposals, through the flat tax ideas advanced by Rick Perry and Newt Gingrich, to Herman Cain’s “999 Plan” – was savagely denounced by the President and his team because they would supposedly risk increasing the deficit. A fraudulent study supposedly “proving” that Romney’s plan didn’t “add up” was endlessly cited by the Obama campaign, even after its authors admitted it was bunkum. The same argument is invariably advanced by liberals whenever ideas like the Flat Tax, Fair Tax, or even small tax rate reductions are suggested. The possibility (indeed, to any serious student of economics, absolute certainty) of increased government revenue from the combination of lower rates and higher economic output – a smaller slice of a larger pie – is dismissed out of hand. We simply cannot risk adding a single dollar to the deficit by reducing the tax burden on American consumers and businesses!

But all of a sudden, Barack Obama sat for an interview with George Stephanopoulos of ABC News and breezily asserted that “we don’t have an immediate crisis in terms of debt.”

Well– I understand. Which is why, at some point, I think I take myself out of this. Right now, what I’m trying to do is create an atmosphere where Democrats and Republicans can go ahead, get together, and try to get something done. And, y– you know– I think what’s important to recognize is that– we’ve already cut– $2.5– $2.7 trillion out of the deficit. If the sequester stays in, you’ve got over $3.5 trillion of deficit reduction already.

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