Big Government is Back!

Of course, this shouldn’t surprise you, but Big Government is back. President Barack Obama will be releasing his budget proposals today at 11 a.m., and the budget is filled with a $634 billion dollar health care plan, more tax hikes to the wealthy (which will not take place until 2010, and more money will be sent to domestic projects, rather than national defense projects.

According to The Politico, this budget would directly tax the wealthy at rates of 33 percent. While this may not seem alarming to many, it could not come at a worst time with the current state of the economy.

Hard on the heels of Obama’s speech to Congress, administration officials began briefing lawmakers Wednesday on their proposals including the healthcare reserve fund: half of which would come from health-related expenses and half by scaling back the value of itemized deductions for wealthier taxpayers.

By itself, the $634 billion won’t be enough to finance the president’s ambitious health plans. But it represents a major commitment upfront, with the administration promised to work with lawmakers to find additional savings as legislation is developed this year.

Obama’s focus on high-end households is consistent with his larger philosophy — both in taxes and spending.

Within the $2 trillion in savings, for example, the budget is expected to limit agriculture subsidies to farms earning more than $500,000, resulting in an estimated saving near $16 billion. Large charitable deductions—used to shelter income—would face new limits, and Bush-era tax cuts for the wealthy would expire after 2010.

The new healthcare reserve fund is a separate enterprise but with much the same philosophy.

Wealthy individuals, taxed at rates of 35 percent or 33 percent, could still shelter part of their income with large itemized deductions, but these would be treated more as if the taxpayer were in the lower 28 percent tax bracket.

Thus, each $10,000 in deductions — worth about $3,500 for a 35 percent taxpayer today — would be worth closer to $2,800 or 20 percent less.

Why should the government tax and spend its way to prosperity? I think you should not tax in troubled times to fund for a nationalized health care plan, which does not work. For example, in Canada (where nationalized health care is mandated), there are many who travel to the U.S. for health care due to the massive delays in common life saving procedures. Our country is renowned for its quality health care system, and universal health coverage would drive many of doctors out of business or being entirely overworked.

However, with the expansion of big government programs and initiatives, many Republicans have embraced the core principles, which they strayed from in the past. Many of them have chided President Obama for his love of expanding the size of federal government. Minority Leader John Boehner (R-OH) recently published an editorial in The Hill that criticized the looming expansion of super-sized government. Boehner inquired how both Obama and the Democrats were planning to pay for each of these proposed programs, while he took a hard line stance on saying that a national health care is just “preposterous.”

It is time to fight back and stick to our guns on the expansion of big government. Hopefully, the GOP in Congress has awaken to their bad behavior and get back on track advocating for our core party principles of limited government and fiscal responsibility. Remember, Ronald Reagan once said, “The most terrifying words are “I’m here from the government and I’m here to help.”