The Che Convention

The Che Convention
September 6, 2012

Peter Ferrara

Peter Ferrara is senior fellow for entitlement and budget policy at The Heartland Institute, a... (read full bio)

The Democrats open their national convention this week under dark storm clouds of left-wing extremism. This is not your father's Democrat party. George McGovern would be a right winger at this convention.
 
The party meets to renominate Barack Obama, the most left-wing nominee and President in U.S. history, a self-identified Marxist with a long professional record of associating with Marxist and left-wing extremist individuals and organizations, if you read his autobiographies. If you disagree, or know someone who disagrees, the answer is read what the man himself has written about himself.
 
I won't repeat that history of associations here because it is old news and would take way too much space to do it justice. It is a matter of public record, and not a matter over which reasonable people can differ.
 
The Che Guevara Democrats
 But it is not just Barack Obama. The repeatedly reelected leader of the Democrats in the House is Nancy Pelosi, from an ultraliberal San Francisco district where the voters have long since stopped thinking and just vote Che as a matter of style. There are many more like her in the Democrat caucus, from similar districts. The soul of the House under Pelosi's leadership is the Congressional Black Caucus, which features openly socialist representatives from inner city urban districts where the only political competition is between left and lefter. These members have replaced the Southern conservative Democrats of a generation ago as the most senior members of all the important committees. That marks an enormous difference from the Democrat party of the 1970s, further reflected in the complete collapse within the party of conservative Democrats.
 
Check out too the states where Democrats are in full, uncontested control, such as California and Illinois, which resemble Greece in fiscal, financial matters. In California, still more tax increases are on the ballot for this fall. In Illinois, after raising taxes on "the rich," and on business, surprise, revenues are running short of projections, and deficits continue.
 
Or check out the political leadership of the major urban centers where Democrats also reign in full, uncontested control, such as Los Angeles, San Francisco, Seattle, Detroit, New York, Philadelphia, Baltimore, Chicago, Miami. A couple of these have rational mayors, but check out the city councils, the aldermen, the lesser elected officials. The debate in these political jurisdictions is as left wing socialist/Marxist as in any other jurisdiction in the world.
 
The grassroots spine of the party is the public employee unions, the SEIU, the teachers unions, AFSCME. This makes America's Democrat party of today reminiscent of the British Labour Party of yesterday. Then there are the environmental extremist groups seeking to repeal the industrial revolution. You can see their handiwork in the deindustrialization of California, for example, even the rollback of agriculture in the state. In the next administration, you will see national economic statistics published without California, to understand the dominant national trends in the parts of the country that are still trying to be prosperous.
 
Then there are the social liberal interest groups, the gay rights groups, the pro-abortion groups, the transgender alliances. And, of course, the openly leftist student activist groups that Obama plays to, and Occupy Wall Street, which seems to have been the Democrats' bid for a brown shirt group to start a riot. Remember Pelosi endorsing them? But it didn't fly with the broader public so they seem to have backed off.
 
This is the heart and soul of the modern Democrat Party. And it is thoroughly Che.
 
The Biggest Government Spender in World History
 You can see this increasingly flipped out Democrat party in Obama's left-wing Presidency and reelection campaign. The numbers show that President Obama is the biggest government spender in world history. He proposed in his 2013 budget released in February to spend $3.8 trillion in fiscal 2013, which starts next month, an all-time world record for one year of government spending. For 2022, he proposed spending $5.820 trillion, an increase of 53%, another world record. For the next 10 years, the President's own 2013 budget proposes to spend $47 trillion, the most in world history by far. President Obama cannot say George Bush made him propose all that record shattering spending!
 
Obama's runaway spending spree is so left-wing it makes Franklin Roosevelt look like a Republican. The most Roosevelt ever spent in one year (during peacetime) was 10.7% of GDP, at the height of the Great Depression. Over Obama's four years of office, federal spending has averaged 24.4% of GDP. Since World War II, up until Obama, federal spending actually was fairly stable around 20% of GDP. But Obama and his Che Guevara Democrats have already broken through that consensus, raising federal spending by about one fourth.
 
CBO further projects that on our current course, under current policies, federal spending soars absurdly, to 30% of GDP by 2027, 40% by 2040, 50% by 2060, and 80% by 2080. Add in another 10% to 15% for state and local government spending, and we will have smashed right through Swedish socialism, all the way to full blown communism, where the government takes and spends everything. You see what I mean by Marxism?
 
Yet, President Obama refuses to consider any entitlement reforms to gain control of that bankrupting spending. Instead, he rammed through Obamacare in his first term, which adopted or sharply expanded 3 new entitlement programs, only adding fuel to the fire. Then he ridicules Paul Ryan's efforts for the fundamental entitlement reforms that would make a difference, so carefully designed that no one would be hurt. In fact, Ryan's Medicare reforms would be better for seniors than Obamacare's Medicare, and Ryan's Medicaid reforms would be better for the poor than Medicaid under Obamacare, just as all of Ryan's reforms to welfare entitlements would actually benefit the poor.
 
As a result, CBO also projects that on our current course, under current policies, the national debt held by the public would rocket to 140% of GDP by 2030, 220% by 2040, and 320% by 2050, on its way to over 700% by 2080. That is a roadmap to a Grecian-style sovereign debt crisis, which would arrive long before that, unless we change leadership, and change course.
 
Note, those projections of skyrocketing national debt include the Obama tax increases discussed below, which are already enacted in current law and included in current policies. But CBO does not accurately account for them, as sharply raising taxes on the most critical and productive economic actors, the nation's job creators, investors, and successful small businesses, will more likely lose revenue rather than gain it. Indeed, if those tax increases do throw the country back into recession, as argued below, federal revenues will collapse again, and federal deficits and debt will soar further.
 
Checonomics and the Coming Crash of 2013
 CBO reports that in 2009 the top 1% of income earners paid 39% of all federal income taxes, three times their share of income at 13%. That was more than the bottom 95% of income earners combined! In fact, the bottom 60% of income earners, as a group, paid less than 0% of federal income taxes. Instead, as a group, they received net payments from the IRS.
 
Yet, President Obama has spent the past four years barnstorming the country, calling for still more tax increases on "the rich" because they allegedly do not pay their fair share. He continually tells us that Warren Buffett pays a lower tax rate than his secretary. But CBO reports that the average federal tax rate paid by the top 1% in 2009 was 29%, counting all federal taxes. Yet, the average federal tax rate paid by the middle 20% of income earners was only 11.1%, and the average federal tax rate paid by the bottom 20% of income earners was 1%.
 
This rhetoric is classic Marxist extremism. But it has already begun to be implemented into federal law. On January 1, the top tax rates of virtually every major federal tax are already scheduled to increase under current law. That is because the tax increases of Obamacare go into effect then, and the Bush tax cuts expire, which the President refuses to renew for the nation's job creators, investors, and successful small businesses.
 
As a result, the top two income tax rates will jump by nearly 20%, the capital gains tax rate will soar by nearly 60%, the tax on dividends will nearly triple, the Medicare payroll tax rate will rocket up by 62% on these disfavored taxpayers, and the death tax will rise from the grave with a 57% rate increase.
 
This is all on top of the corporate tax rate, which at nearly 40% on average (counting state taxes) is the highest in the world, except for the socialist one party state of Cameroon. Yet, under President Obama, there is no relief in sight. Instead, he has spent his presidency calling for still more tax increases on businesses, large and small, and on investors, reflecting further classic, anti-business, left-wing extremism. If President Obama's proposed Buffett Rule is adopted, capital gains taxes would increase by 100%, with the fourth highest rate in the world, to go along with his world's worst corporate rate.
 
In Toledo, Ohio, on Labor Day, President Obama alleged that Mitt Romney's economic plan "undoes reforms that are there to prevent another financial crisis and bank bailout. He wants to get rid of rules that are there to protect our air and our water, and workers' rights, and protections to make sure that health care is there for you when you get sick." What he is saying in plain English is that if he is reelected as President, you can forget about reducing regulatory burdens on jobs creators and businesses.
 
Instead, his plan is for still more regulatory burdens, bigger and badder than ever. With the nation suffering the longest period of unemployment over 8% since the Great Depression, President Obama recently announced that his top priority in a second term would be global warming!! His EPA is already busily implementing regulations to shut down traditional energy production and use to counter mythical global warming that will cost the economy trillions more, still another effective tax increase.
 
When these Obama regulatory burdens join with the comprehensive tax rate increases, and the runaway federal spending, deficits and debt, the result will be another recession next year. Unemployment will then jump back into double digits, the deficit will rocket over $2 trillion, poverty will climb to still more record smashing highs, and real wages and incomes will plummet to new lows.
 
Soviet Style Propaganda?
 In the old Soviet Union, the dictatorship would use its total control over the nation's media to bludgeon the public with propaganda proclaiming and celebrating the exact opposite of reality. And now we see that same rhetorical style in the Obama campaign.
 
President Obama told the crowd in Toledo on Monday, that Mitt Romney's tax plan "hikes taxes by nearly $2,000 on the average family with kids in order to pay for a massive tax cut for multi-millionaires." But the truth is that Mitt Romney's tax plan proposes numerous tax cuts for the middle class, and no tax increases for anyone.
 
President Obama further regaled folks in Toledo with the allegation that Romney/Ryan's Medicare reform plan involves "ending Medicare as we know it by giving seniors a voucher that leaves them to pay any additional cost out of their pocket," which would mean a "loss of up to an additional $6,400 a year for the same benefits you get now. But the truth is that Medicare as we know it includes Medicare Parts C and D, and that all the Medicare reforms proposed by Romney/Ryan would do is extend to the rest of Medicare, the old-fashioned Medicare Parts A and B, the same policies that have worked so well to hold down costs through choice and competition in the more modern, highly popular, Medicare Parts C and D. Those policies involve a bidding auction by private health insurers to provide the same coverage as Medicare, with Medicare giving seniors enough to pay the premiums for at least two of the bidding plans in their local area, with zero extra out of pocket costs, let alone $6,400 per year per family. This propaganda involves yet more failed leadership by the President on the entitlement issue.
 
This is all the tip of the iceberg on the left-wing extremism of the Obama campaign and today's Obama Democrats. Obama is celebrating the taxpayer bailout of the auto industry, with a likely loss to taxpayers of $23 billion, and promising still more such crony socialism in a second term, with the socialist policy of the federal government now owing 26% of General Motors, and the unions owning more of GM and Chrysler.
 
The Obama campaign and the Democrat convention are celebrating abortion, and gay marriage, and the imposition of the health insurance mandate on the Catholic Church forcing them to pay for abortion and birth control pills contrary to their faith. Thus, Obama and the Democrats have declared war on social conservatives, and the pro-family, traditional values movement.
 
The Obama Administration tried to plant American guns in Mexico to use as a talking point in favor of gun control, and American and Mexican law enforcement officers died as a result, in the so-called Operation Fast and Furious. One more Supreme Court appointment by President Obama, and the Second Amendment Right to Keep and Bear Arms would be lost to the American people.
 
But the choice belongs to the American people. Do we really want Che Guevara as President of these United States?

Peter Ferrara

Peter Ferrara is senior fellow for entitlement and budget policy at The Heartland Institute, a... (read full bio)