Flash Point: What Obama Math Portends for the Fiscal Cliff

Put a dollar in a taxpayer’s hand and you’ve raised his disposable income by $1. This is what people spend and this spending spurs business development and stimulates the economy. Take a dollar out of his hand and the opposite effect occurs. In this light, consider the MarketWatch report: Obama seeks $1.6 trillion in tax increases: WSJ.

The White House wants both $1.6 trillion in tax increases as part of a fiscal cliff deal … [and] for at least $50 billion in new spending to spur the economy …

So lets do the math on the total stimulus effect of these two measures (in billions of dollars). $50 – $1,600 = -$1,550. Now that’s impressive stimulus – not. We can hardly wait to see what the Obama solution to the fiscal cliff turns out to be.

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