Today is April 15, Tax Day.
The federal government will consume 20.5 percent of America’s total income this year. It’s not as bad as in France or Greece, but somewhat worse than when we formed these United States. When we were Colonies under the British, the average tax burden on American colonists was 2 percent. That was considered unbearable, and the revolution was on.
There has been some slippage over the years. The 16th Amendment allowing the income tax opened the door to truly European, supersized government.
It could be worse, though.
Barack Obama was elected with his promise that he would never sign “any form of tax increase” on any American earning less than $250,000. The promise was very specific and repeated throughout the campaign for emphasis.
“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital-gains taxes, not any of your taxes,” said Mr. Obama in September 2008.
But 16 days into his presidency, Mr. Obama signed his first tax hike on tobacco users, a group of Americans whose income averages $40,000.
Then came the Obamacare 20 taxes to pay for our “free” health care. They will total well in excess of $1 trillion during the next decade. At least seven of those taxes directly hit Americans making less than $250,000. Those taxes fall on Americans with Flexible Spending Accounts and Health Savings Accounts, those with insurance already, and those visiting charitable hospitals. Bizarrely, Obamacare taxes those who get really sick and have health care costs more than 10 percent of their adjusted gross income, an income-tax hike that will hit 10 million American families.
The 20 taxes of Obamacare are not the end of Mr. Obama’s tax wish list, though.
We know the taxes the president passed. What about the taxes he sought and failed to impose to date?
Americans for Tax reform looked at Mr. Obama’s six annual budgets and found a total of 442 taxes proposed. All were stopped by the Republican House of Representatives since 2011, but Mr. Obama keeps coming back with his target list.
One notes that the smallest number of tax hikes was in the budget proposed in 2012 when he was running for re-election: “Only” 34 tax increases. Once safely past the election, the number of tax hikes Mr. Obama proposed to Congress swelled up to 137.
Many of those tax hikes targeted energy. The oil and gas we use to heat or air-condition our homes would rise dramatically in price if Mr. Obama had gotten what he asked for. The energy boom of new jobs created by fracking might never have happened if new taxes had slowed or stopped such exploration and development. Mr. Obama’s energy policy is backward: lengthen cost-recovery timetables for oil and natural-gas producers while doling out tax breaks for politically connected wind and solar companies. Think Solyndra.
All taxes hurt the economy. Increasing taxes on something raises its cost. Sales taxes make our products more expensive. We buy less. Income taxes make hiring someone more expensive. Fewer people are hired. Raising taxes on a product or service or your job always reduces the demand for them. We tax cigarettes to reduce consumption and then wonder why taxes on jobs — income taxes — reduce the number of jobs.
This economic recovery, which has technically been in place since July 2009 — almost five years — is the weakest recovery since the end of World War II. According to the Joint Economic Committee, if we had recovered simply as well as we did over the average post-1960 recovery we would cumulatively have had $3.7 trillion in higher economic output since the recovery began and 5.7 million more Americans at work today.
Had Mr. Obama followed the path of Ronald Reagan — reducing rather than raising taxes — his recovery might have been as strong as Reagan’s, which by now would have increased the gross domestic product by $5.9 trillion over today’s weak number, and we would have 10.8 million more Americans at work on this sadder, poorer and less hopeful April 15.
The Obama recovery with high unemployment was not necessary or inevitable. But if Mr. Obama had had his way, it would be much worse than it is today. Perhaps the glass is half-full.
Grover Norquist is president of Americans for Tax Reform.