Is the Obama administration planning major tax increases? Of course not, as Larry Summers, director of the National Economic Council, explains to Maria Bartiromo in the latest Business Week:
So if we were to see the economy not grow at 4%, would you be prepared to suggest that perhaps he should pull back his plans to raise taxes on the highest earners?
Let’s just be clear here because what you said is not quite correct. The President isn’t taking any action to raise taxes. Current law calls for [the Bush tax cuts for high-income earners] to expire [in 2011]. And the President does believe?and he is surely right in this conviction?that given the magnitude of the debt problems the country faces, we can no longer afford those tax cuts for a very small fraction of the population. If you look at the long-run fiscal burden imposed by those tax cuts, it’s as great or greater than the entitlement programs that generate so much discussion, and the evidence suggests [the cuts have] very little stimulative benefit. So yes, we are prepared to let those tax cuts expire.
?Letting tax cuts expire? means ?raising taxes.? Why is that a bad idea? I?ll let Steve Moore explain.
