The Bush McCain 2001-08 tax increase is a direct result of the fact that the dollar has lost half its value since Bush took office.
It's ironic how the Republicans get away with denying that they have raised taxes. By running up huge deficits and gutting the value of the dollar, they have created the equivalent of the biggest tax increase in US history.
BUSH MCCAIN 2001-08 TAX INCREASE IS THE BIGGEST YOU WILL EVER SEE IN YOUR LIFETIME
It's ironic how the Republicans get away with denying that they have raised taxes. By running up huge deficits and gutting the value of the dollar, they have created the equivalent of the biggest tax increase in US history.
The Bush Administration has done such a bad job of managing our economy and the federal deficit that the value of the dollar has decreased by half since Bush was elected. Now think about this. If you were buying oil from Saudi Arabia in 2001 at $2.00 per gallon, losing half the dollar’s value automatically makes that $4.00 per gallon in 2008. Sound familiar? And the full effects are only just beginning, as we’re seeing with food and just about everything else that middle class families have to buy.
If the Bush administration had passed a formal tax increase that took half of the money out of your pocket (in terms of what you can buy on the world market), he would have been impeached long ago. But because it’s hidden in the way Bush killed the dollar and jacked up inflation, he gets off without any blame for raising taxes. The Democrats have to start calling this what it really is, the Bush McCain Tax Increase.
McCain proposes to continue the Bush McCain Tax Increase with his continued support for tax cuts for the rich and huge spending on Iraq. This means that we will continue borrowing a billion dollars a day from China and other foreign bankers, making the dollar even less valuable.
So when you hear the Republicans talk about taxes, remember that they put in place the biggest tax increase you will ever see in your lifetime. It just didn’t come through the IRS.
This phenomenon is now playing out in other parts of American life. Abu Dhabi purchased the Chrysler building in New York City. A Belgium company bought Budweiser. European basketball teams are trying to recruit away top players from the NBA. In fact, wealthy people from the Middle East, Europe, South America and Japan are buying American assets at an accelerating rate, all because of the gutted dollar. So add to Bush’s Tax Increase the fact that he is overseeing the biggest fire sale of American assets in our country’s history.
What this means in the coming months and years is a steady deterioration of the American standard of living. You will be more likely to be working for a foreign corporation. Buying anything that’s imported, from gas to sneakers, will cost a lot more. Sometimes it will happen dramatically as with gas prices. Mostly it will happen slowly, gradually increasing the cost of products we take for granted today until we consider them luxuries tomorrow.
There will be a lot of political rhetoric about who’s to blame for all of this. But when the historians and economists add up the toll, there is no question that the fault will be attributed to Bush’s economic mismanagement. Our only hope for stemming this tide is a new economic course for the country that breaks with the mistakes of the Bush years. Obama’s ideas are our best chance. It will never come from McCain or the Republicans.
Mark Friedman is the director of the Fiscal Policy Studies Institute in Santa Fe and the author of the book "Trying Hard Is Not Good Enough."