kottcamp

What Election 2008 Will Do For Our Economy, and Your Tax Bill

Does anyone remember their US Government classes? Does anyone remember how budgets are passed?

If Obama gets elected, he'll have a Democratic Congress, so he'll repeal the Bush tax cuts; and perhaps pass some new ones for the middle class. He will also be pushed to spend by a Democratic Congress.

If McCain gets elected, he won't get support from the Democratic Congress to push for any more tax cuts; nor will be have support to extend Bush's tax cuts, many of which, such as capital gains and dividends expire at the end of this year. The tax rates will reset at the end of 2010. Worst case (from a Federal Budget perspective), the top will have 2 more years of lower taxes rates (maybe not a bad thing given the current economic malaise). On the spending side though, you'll see substantially less spending, since McCain will likely veto new spending proposals (or at least more than Obama would).

Net net, even if McCain wanted to be as profligate as Bush, he couldn't be; and given that he'll be able to control spending more than Obama (remember, the affable Carter couldn't control his Democratic Congress either), you should wind up with a lower budget deficit.

Again, people need to remember HOW our government actually works when they vote; the President is not the King; his budgets have to be approved by Congress.