Tax and Spend

Federal taxes and receipts have grown ten-fold since the
mid-1970's per the Office of Management and Budget

In last month's State of the Union address the President called for the taxing of educational savings accounts (529 plans) (withdrawals exceeding invested amounts would be taxed as ordinary income). The resulting protests from many quarters, including his own party, forced him to back off.

Now the President is calling for the current U.S. taxation of foreign subsidiaries of U.S. companies. These subsidiaries generally do not pay U.S. taxes until the profits are sent back to the U.S. parent.

There are policy arguments for and against the President's position, but the larger picture is:

a) For the past 40 years Federal spending has ratcheted up inexorably, regardless of which party controls the White House;

b) Under President Obama estimated 2015 Federal tax receipts of $3.1 trillion will be 50% higher than 2009 (give him credit for an improving economy).

c) These historically high receipts still are not enough to fund the President's vision of government.

d) If this corporate-tax increase fails (or even if it's partially enacted), look for the President to submit other revenue proposals. Whatever tax increase Congress agrees to, it won't be enough.

[Update - 2/13/2015: First Time Ever: Federal Tax Revenues Top $1 Trillion Thru January; Gov't Still Runs $194B Deficit.]