How many times do Barack Hussein Obama and his media shills have to tell us the federal deficit was “inherited” from George W. Bush? The deficit Obama “inherited” was $1.3 trillion and let us remind everyone who was running the purse strings in Congress for two-years – DEMOCRATS!

The deficit Obama inherited equals 9.2 percent of gross domestic product (GDP), said the administration official. Against what had been the recently publicized, cash-based “official” fiscal 2008 (year-ended September 30th) the federal deficit was $454.8 billion. The splurge of TARP money expanded the debt by the time Bush left office and Obama was for the extra cash strap government got by doling out billions more to “stimulate” the economy and we’ve seen how well that hasn’t worked out.

Obama and his ilk in Congress on running up the deficit on a bullet train to nowhere, without adequate debate and many times behind closed doors with their opposition minority party left out of talks. The so-called compromise Susan Collins (R-ME) declared with the last spending package was added back in before the final vote.

Federal outlays will soar in fiscal 2009 to $4 trillion, or 27.7% of GDP, from $3 trillion or 21% of GDP in 2008, and 20% in 2007. This is higher as a share of the economy than any year since 1945, when the country was still mobilized for World War II. It is more spending by far than during the Vietnam War, or during the recessions of 1974-75 or 1981-82. Milton Friedman taught us that spending represents the real future burden on taxpayers.

The 2009 budget deficit is estimated to be 12.7% of GDP! The White House predicts that this will fall back down to 3.5% as soon as 2012, but the devil is in the details as we are about to demonstrate.

Obama Assumptions:

• Nearly all of the new stimulus spending will be temporary;
• Elimination farm subsidies for those with annual sales of more than $500,000 (Farm state representatives will fight this);
• Largest tax increase in U.S. history, starting in 2011 with the repeal of the Bush tax rates on incomes higher than $200,000 for individuals and $250,000 for couples. (Yes, repealing the cuts is a tax increase);

Obama’s assumptions would have you believe tax increases don’t affect anyone but the individual receiving that increase. Mr. Obama has other plans with cute little names that are, in fact, taxes on 100% of the population.

Taxing the rich has a trickledown effect similar to the one when the rich are given a tax break. What happens at the top finds its way into the economy, effects prices, investment, business growth, and job creation or loss.

Obama promised this week that “95% of working families” would not see their taxes rise by “a single dime,” yet his own budget reveals that taxes will rise for 100% of everyone for the sake of global warming. Haven’t we heard this theme before?

Barack Obama explains that “climate revenues” from “cap and trade” expects $78.7 billion in new tax revenue in 2012 while growing to $237 billion through 2014, and at least $646 billion through 2019. This revenue comes from taxing everyone  under the cloak of a fancy moniker.

Government revenue that is spent is a tax and the politicians are unlikely to tell you this. Obama projects that these “climate revenues” will become the sixth largest source of federal receipts by 2019, outpaced only by individual and corporate income taxes, payroll taxes for Social Security and Medicare and (barely) excise taxes. All these taxes come from the entire US population who earns an income or uses products and carbon energy that will be effected by “cap and trade.”

Mr. Obama’s Energy Secretary Steven Chu agrees with our little blog that change is coming and it’s not what we might expect or want.

“The concern about cap and trade in today’s economic climate,” Mr. Chu said, “is that a lot of money might flow to developing countries in a way that might not be completely politically sellable.”

Are we really being sold this great idea or force fed? Congress would create a new property right to expend CO2, setting a price per ton on carbon output, and then Congress would also get to determine the distribution of allowances. The Administration wants all of them to be auctioned off, which is what creates the giant revenue windfall. The politicians would then decide how to spend all of that new “climate revenue.”

Obama’s budget proposes to spend this windfall on two items:

• $15 billion a year in more subsidies for alternative fuels, and
• $65 billion or so a year to finance tax subsidies for workers, many of whom don’t pay income taxes.

Once cap-and-trade tax is on the books, the revenue stream will create political constituencies that depend on it. Controlling the census from the White House and using taxes to gather more voters is an Obama and liberal plan to stay in control of government by a slick gerrymandering scheme.

The Wall Street Journal brings some light to the new reality of Obama: (Emphasis LCs)

With $1 trillion of new entitlements, $1.4 trillion in new taxes, and $5 trillion in new debt, America’s entrepreneurs aren’t getting any help soon from Washington.

Democrats will want to rush all of this into law this year while Mr. Obama retains his honeymoon aura and they can blame the recession on George W. Bush. But Americans are only beginning to understand the magnitude of Mr. Obama’s ambitions, and how much of their own income will be required to fulfill them. Republicans have an obligation to insist on a long and considerable debate on all of this, lest Americans discover in a year or two that they live in a very different country.

The warnings are out there and anyone paying attention should prescribe from the quote of Howard Beale in the movie “Network.”

“I’m as mad as hell, and I’m not going to take this anymore!”

Do it soon, get involved, write or contact your legislator today. Indeed!

See Also: Obama The Rhetorical Magician