RUSH: This is hilarious. As you know, ladies and gentlemen, beginning with the first day of the year, and because of the fiscal cliff deal, the temporary partial tax cut on the Social Security tax expired. There was a temporary partial exemption on the payroll tax. I’ve been asked if most people noticed it. They didn’t notice it until they were told about it. It added up to, depending on your income, it could be a thousand dollars a year that you had extra because of this partial tax. Anyway, on January 1, that partial temporary tax cut expired, and now everybody’s payroll taxes are back up to 100% of what it should be, which is 13%. The employer pays half and the employee pays half. The employee pays it all but that’s too complicated even for people who understand the economy.
Anyway, here’s the thing, what happened here. The first paychecks for the new year for some people have gone out and they have noticed that their paychecks are smaller. And somebody went to Democrat Underground, somebody got the idea to go there and just troll and look around, and one of the first posts in Democrat Underground last night was this: “What happened that my Social Security withholding’s in my paycheck just went up? My paycheck just went down by an amount that I don’t feel comfortable with. I guarantee this decrease is gonna hurt me more than the increase in income taxes will hurt those making over 400 grand. What happened?”
The average Democrat who was out there applauding the tax increase on the rich discovered smaller take-home pay in his first paycheck. What the hell happened? So he looked into it and he found out that his payroll tax is now gone back up to what it should have been all along, the temporary partial deduction expired, and his take-home pay is less. He thought only millionaires and billionaires are gonna be paying more in taxes. We tried to warn everybody here that the middle class was gonna have a tax increase because the payroll tax deduction expired, and it was going back to full boat, 6.2% employee pay, 6.2 employer pay. The 6.2 employee payment was 4.2 for the last year or two. But now it’s back up to 6.2, which is gonna mean, depending on your income level, somebody making $75,000 a year, it’s $1500 a year taken out of their paycheck that has not been in the past two years.
Anyway, this began a thread at Democrat Underground with all kinds of ticked off Democrats, livid Democrats, and what was hilarious about it was that over half of them were blaming George Bush for it, when it was Obama. It was all Obama! Obama and the Democrats engineered — and the Republicans went along with this — the payroll tax cut, which was a temporary partial tax cut on the employee side, but it was restored with the fiscal cliff deal. So paychecks beginning this year, first week of the year, are smaller. And you should see the thread of all these ticked off Democrats who had no idea they were gonna be paying more in taxes. And as part of the thread, there are people trying to explain to them what happened, and some of them understand it, and some of them don’t, but they’re all livid.
They’re fit to be tied. And then they resort, it’s probably Bush’s fault, they think. They think that Bush has come back from four years of a presidency that’s expired to bite them. And they’re livid over it. It’s a classic illustration. You talk about low-information voters. You talk about people have no clue. You talk about people that support things they have no idea what they’re doing in terms of harming themselves by virtue of what they support. The Democrat Underground: what happened that my Social Security withholding and my paycheck just went up? This guy had no idea. And it’s a long thread. I don’t know how long it is now.
This is happening all over the country. Now, people that get paid every two weeks, this hasn’t happened to them yet. You get paid on the 15th or 30th of every month or whatever, your shock is yet to happen. But some people, somehow, have already gotten their first paycheck of the year and they’ve noticed it.
RUSH: We played the sound bite earlier in the program. Ali Velshi, the ace economics reporter for CNN, said that the great thing that’s happening in America today is that finally the American people understand economics. They understand what’s going on, and they understand that the debt limit, for example, has nothing to do with federal spending. It’s been a long time coming but they finally understand it.
Now, I mentioned moments ago when I was telling you the outrage on Democrat Underground from people whose paychecks were smaller because their Social Security tax went back to normal. They didn’t know it was coming and they were livid and they’re blaming Bush. So I got some e-mail asking: “What do you mean, blaming Bush?” It’s a good question. I should have ‘splained it. Here is the thinking.
Now, remember, Ali Velshi says the American people understand economics. On Democrat Underground, they blamed Bush for causing the economic crash by cutting taxes. In other words, the people at Democrat Underground believe the recession happened because of tax cuts. Now, what…? If I may again remind you what I was saying throughout December, up until the time I left for the Christmas break: What was Obama’s objective?
Obama was attempting to achieve a confession, a confession obtained from the Republicans. He wanted them to break their pledge to never raise taxes on anybody. Obama particularly wanted them to break that pledge on the rich so that he could spin that into the Republicans admitting that tax cuts caused the economic problems. This is why I don’t think the Republicans have the slightest clue what’s going on, folks. And this is why I say it.
The Republican brand (if you will), if it’s known for anything, it’s tax cuts, which means a growing economy. Tax cuts mean you keep more of what you earn. It means that there are more jobs created. It means you broaden the base, you increase jobs, and therefore you increase the number of taxpayers. The more people there are paying taxes, the more revenue there is to Washington. But you don’t have to raise individual taxes to increase revenue to Washington.
You can get more revenue by simply creating jobs, and you do that by lowering taxes. And that’s what the Republican Party has been known for. And Obama wanted to strip them of that. Furthermore, he wanted that identification, and he’s got it! Obama’s the big tax-cutter now. That’s what people think. But the Republican tax cuts caused the problems. This has been Obama’s point for four years.
Obama even admitted earlier this week that what he pulled off was one of the most profound political achievements in 20 years, and he’s right. He got the Republicans to agree that their tax cuts, particularly for the rich, led to the recession that we’re in. So with more Americans now, quote, unquote, “understanding the economy,” that’s what they think. So over at Democrat Underground, these schlubs are falling right in line.
The Bush tax cuts led to the recession, which means that Obama, in order to grow the economy, had to raise taxes. That’s what they think! This is what we’re up against.