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Obama administration "dead wrong" about taxes

Faster horses

Well-known member
The U.S. economy is suffering through a "soft patch" but "I don't think we're going to have a double-dip recession," says David Malpass, president of Encima Global, an economic research and consulting firm.
But Malpass, a Republican candidate for U.S Senate in New York, frets letting the Bush tax cuts expire will have a "material" impact on the economy, even if just for the wealthiest Americans.

"Countries around the world are cutting their top marginal [tax] rate in order to create jobs," he notes. "Why is the U.S. standing out like a sore thumb raising the top marginal rate?"

Malpass offered the following answers to his own question:

-- "Politicians are addicted to spending and expanding their fiefdom."
-- Treasury Secretary Tim Geithner and top Obama economic advisor Larry Summers are "dead wrong" about people's sensitivity to higher tax rates, Malpass says. "Data show the economy is very sensitive to the top marginal tax rate; that's where much of the innovation is done."
-- Geithner's comment Monday at NYU that the economy can "absolutely" handle the expiration of Bush tax cuts for the top 2% is "wrong and self-serving," Malpass says. "Secretary Geithner is presenting an argument that's really good for Washington," where the Value Added Tax (V.A.T.) is the "next frontier."

You'd certainly expect such comments from a former Treasury and State Department official in the Reagan and Bush I administrations. But Malpass is also a staunch defender of small businesses, which he says are under attack right now.

"Washington has cut off credit to small business and are channeling the money into big government, big banks, and big corporations," he claims. "It's almost a contemplated attack [on small businesses] by Washington and it's having its effect." (On Tuesday, a Wells Fargo/Gallup index of small business sentiment fell to its lowest level since the poll's inception in August 2003.)

Check the accompanying clip for Malpass' explanation of why letting the Bush tax cuts expire will squeeze small businesses further, and stay tuned for part 2 where he outlines his plans to bring "fiscal sanity" to Washington D.C.

http://finance.yahoo.com/tech-ticker/obama-administration-is-%22dead-wrong%22-about-taxes-david-malpass-says-535292.html?tickers=%5EDJI,%5EGSPC,SPY,TLT,TBT,UUP,GLD&sec=topStories&pos=9&asset=&ccode=



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