Obama has proposed a tax hick on the rich to help cut U.S. deficits by more then $3 trillion. He also promised to veto any effort by republicans to cut medicare benefits for the elderly without raising taxes at the same time.
Obama stated, "This is not class warfare. It's math.We can't just cut our way out of this hole."
This tax increase for the rich will also target loopholes and subsidies for large corporations and cut most of the spending in Medicare spending to health care providers.
Obama also stated, "I will not support any plan that puts all the burden for closing our deficit on ordinary Americans."
Republicans are thankful the beneficiaries are spared but are not necessarily pleased with some of the proposals by Obama.
The "Buffet Rule", named after billionaire Warren Buffet, will target familys who make over $1 million and prevent them from taking advantage of lower tax rates on investment earnings, then what the middle-income tax payers pay on their income taxes.
However, the wealthy, on average, pay more in income taxes the the middle-income tax payers by nearly 15%, according to the non-partisan Tax Policy Center.
The tax hike also hits federal workers. The plan would reduce federal workers paychecks by 1.2 percent over three years, saving the government over $21 billion over 10 years.
This issue could play a major role in re-election and the President is playing his winning hand.
See Link:http://finance.yahoo.com/news/Obama-announces-debt-plan-apf-2168506349.html?x=0
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