In the recent weeks we’ve heard much from both presidential candidates on how they intend to fix this economic mess that we have found ourselves in. On the one hand, we have John McCain who is advocating the growth of our markets through free-market principled economics; while on the other hand Barak Obama is telling Americans that he wants to help the middle classes but what he proposes is the largest growth of taxation and government spending since the Carter Administration.

Obama begins by telling us that he will make sure that only the wealthy or rich will be burdened with a tax raise. He means those that make $250 thousand per year or more. How this arbitrary number was reached, I have no idea – maybe someone should ask him. The first problem with this plan is that the top 25% of income earners in this nation already pay 86% of the tax burden for our nation, and simply because they can afford it is not a good enough reason for people to be levied a tax. In fact, it is not a reason to do anything at all; they earned that money and should keep what they have worked so hard for. 

The second problem is that he applies this to small businesses. He says that only a very small percentage of small businesses make over $250 thousand dollars a year anyway so the small business market will not feel the burden of a new tax. Well, I have news for Obama. He was confused and got it backwards. In fact, only a very small percentage of small businesses make less than $250 thousand per year. The vast majority make between half a million and $10 to $15 Million. Obama has tried to mislead us here as he has on many other issues.

The last thing I’ll mention about this plan of Obama’s is that he never states what portion of that supposed $250,000 and above he will tax. Is it gross income? Net Worth? With Inventory included? What? Because that is a game changer as well, and for him to be so vague about this is dangerous. He will definitely cause small businesses to lose money. If they lose money, then they lose jobs, and when they lose jobs, business decreases, and when that happens, the markets struggle and before you know it, recession time – and all in the guise of helping the middle classes by punishing the so-called rich with taxes.     

Today, Obama has mentioned a $3000 tax credit for businesses that create jobs. Again, Obama’s ignorance gets the best of him. How on Earth is lucrative for a business to spend – and this is just a guess – $65,000 to create a job (salary, benefits, etc.) just to get $3000 in tax credits. That’s like giving a homeless man $3 and then taking him to the most expensive restaurant in town and telling him to have a full meal and then to pick up the check. (This analogy isn’t mine; I’m borrowing it from someone else!)

The point I’m trying to make with all of this is how ignorant Obama is about economics. It’s obvious to me how little these plans of his could work. But, it seems, the ignorance abounds and millions of Americans – including the middle classes – will be fooled by his rhetoric. He seems to be simply regurgitating what his handlers have told him without understanding any of it. Proof of this can be found in his speech this week where he promised a cut to the capital gains tax on investments made in small businesses. Well, the last time I checked, there was no capital gains tax on investments in small businesses – unless, of course, he is planning to institute one, and then cut it for political expedience.

The solution is simple. Cut taxes. You cannot raise taxes during an economic slowdown and hope to spur growth.  It’s like putting water on a smoldering fir and hoping that it’ll make the flames become hotter and higher. No! Remove the burdens placed upon working Americans by the government; give the economy back to the people. The government has no business running business when it can’t even seem to run itself. It is not government’s job to make my life bountiful, it is mine, and the sooner the government relinquishes that right the sooner we can get our country back on track and on the road to growth and prosperity that only our country has ever known. The idea that is America is its people – not its government. With Obama-nomics it would be the other way around – and that way lies disaster.