Barack Obama is no JFK

Patrick Gleason Director of State Affairs, Americans for Tax Reform
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Chris Matthews, the host of MSNBC’s “Hardball,” has a new book out, Elusive Hero, which offers an in-depth and well-researched look at the life and presidency of John F. Kennedy. In light of today’s focus on tax reform and the dealings of the congressional supercommittee, Matthews’s new book provides a timely reminder of the stark contrast between the policies of the man who brought us Camelot and the policies of the current resident of 1600 Pennsylvania Avenue.

An examination of Kennedy’s record shows a Democratic president whose approach to fiscal policy is more in line with congressional Republicans of today than the agenda of President Obama and his fellow Democrats on Capitol Hill. In his annual budget address on Jan. 17, 1963, Kennedy sent the following message to Congress:

“Lower rates of taxation will stimulate economic activity and so raise the levels of personal and corporate income as to yield within a few years an increased — not a reduced — flow of revenues to the federal government.”

Contrast those remarks with President Obama’s most recent executive budget, which calls for a 13 percent increase in the top marginal income tax rate for individuals and small businesses, taking the rate from 35 to 39.6 percent.

In a message to Congress on Jan. 24, 1963, Kennedy stated, “Our tax system still siphons out of the private economy too large a share of personal and business purchasing power and reduces the incentive for risk, investment and effort — thereby aborting our recoveries and stifling our national growth.”

Meanwhile, the aforementioned income tax hike that Obama is calling for would siphon $709 billion from the private economy over the next 10 years, resulting in reduced income for individuals and families, as well as the small businesses that are responsible for over 60 percent of American jobs.

And that’s just income taxes. Kennedy and Obama are also 180 degrees apart when it comes to taxing investment. Kennedy remarked that the “tax on capital gains directly affects investment decisions, the mobility and flow of risk capital … the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.”

Contrast this with Obama, who, during a debate with Hillary Clinton in April 2008, was challenged on his proposal to raise the capital gains tax. Debate moderator Charles Gibson asked why he would take such an approach when “history shows that when you drop the capital gains tax, the revenues go up.” Despite all of the revenue that he needs to fund his spending goals, Obama responded that he supports a capital gains tax hike, even though it would have a negative effect both on revenue and job creation, for reasons of “fairness.”

What exactly is President Obama proposing to do with the capital gains tax, its importance to economic growth so eloquently articulated by Kennedy? Obama is vehemently pushing a massive tax increase on investment income. Between the expiration of the Bush-era tax rates and the 3.8 percent surcharge on investment income included in the 2010 health care bill, Obama is proposing a nearly 60 percent increase in the capital gains tax in just one year, taking the rate from 15 to 23.8 percent. Kennedy’s treatment of investment highlights his economic acumen; Obama’s treatment of investment proves that he’s a hard-left ideologue.

In total, President Obama has signed into law 21 separate tax increases in less than three years, raising taxes by approximately $500 billion. He’s now hawking his American Jobs Act, which entails $467 billion in higher taxes starting in 2013. Between the approaching onslaught of higher taxes in 2013 and regulatory uncertainty, it’s little wonder that economic growth has been anemic and unemployment hovers just below double digits.

In contrast, during his brief time in office, President Kennedy cut the top marginal rate on individual income by 21 points, reduced corporate taxes and lowered the cost of capital by creating an investment tax credit. As the Kennedy tax cuts were phased in from 1962 to 1965, not only did revenues grow by more than a five percent yearly average, GDP surged at a five and a half percent average annual rate.

President Obama’s fiscal policies are very much in step with the Democratic-controlled Senate and Nancy Pelosi’s caucus in the House. As things stand, Democrats are prepared to blow up any supercommittee deal that doesn’t include higher taxes. It seems the closest thing the modern Democratic Party has to a leader in the mold of Kennedy is New York Governor Andrew Cuomo, who balanced his budget with spending cuts alone and remarked earlier this year that his state “has no future as the tax capital of the nation.”

Unlike Lloyd Bentsen, I was not a friend of Jack Kennedy’s, nor did I even know the man. However, judging by the record and rhetoric of JFK and the current occupant of the Oval Office, it is obvious that Barack Obama is no Jack Kennedy. Matthews makes it clear that he thinks there is a lot Obama could learn from Kennedy. When it comes to pro-growth tax policy, I couldn’t agree more.

Patrick Gleason is director of state affairs at Americans for Tax Reform.