Read His Lips: Middle-Class Taxes--IBD

Read His Lips: Middle-Class Taxes from Investor's Business Daily

Candidate Obama made a "firm pledge" in September 2008 that "no family making less than $250,000 a year will see any form of tax increase" Now... View Enlarged Image

Politics: Barack Obama the candidate repeatedly vowed no tax increases for those making under $250,000. As president, he has changed his tune. But cheer up: He now tells us he's a "fierce" free marketer.

The rest of us, especially those in the middle class, could rest easy, he said.

"I can make a firm pledge," Obama said in 2008. "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."

His promises drew thunderous applause, and for that who could not find him an attractive candidate? The tax pledges, repeated over and over, served as the linchpin of Obama's successful campaign. It was the assurance voters needed that he wouldn't be a tax-and-spend liberal, as could be inferred from his other positions.

Today, those promises have gone the way of the candidate's Styrofoam pillars. Government spending has trebled from the prior administration's outlays, and instead of doing something about that, Obama has suddenly gone all "agnostic" on his tax promise.

In an interview this week with Bloomberg BusinessWeek, the president said he no longer ruled out tax hikes on those making less than $250,000 a year. "What I can't do is set the thing up where a whole bunch of things are off the table," he said. "Some would say we can't look at entitlements. There are going to be some that say we can't look at taxes, and pretty soon you can't solve the problem."

So instead of cutting taxes, opening markets through free trade and scrapping the failed 2009 stimulus package before the last $500 million gets squandered, he'll probably end up squeezing the middle class in exactly the way he said he wouldn't.

Tax hikes at the $250,000 mark not only hurt high-achievers. They paint bull's-eyes on the small businesses Obama says he wants to help. Some 21 million sole-proprietor businesses will get socked with such an increase, their money expropriated so the government can route it back to them in new bank lending schemes.

Small wonder business confidence is at an all-time low and business-funded billboards are going up against the president.

As if tax hikes on the middle class aren't bad enough, the administration also wants to roll back George W. Bush's tax cuts for Americans making more than $250,000. If he gets away with this, higher rates are in store for even more small businesses.

Obama's betrayal of his no-tax pledge to voters is as noteworthy as the broken read-my-lips pledge that many believe cost George H.W. Bush the 1992 election. Obama may be arrogant enough to think voters won't treat his broken promise just as harshly. But his recent statements about perhaps being a one-term president could suggest he knows what he's doing.

Whatever the case, the president apparently hasn't lost his sense of humor. "We are pro-growth," he also told BusinessWeek. "We are fierce advocates for a thriving, dynamic free market." Call us curmudgeons, but we are neither amused nor reassured.

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