Obama Bodysurfing
Some days (actually most days) it seems like President Obama hates me. It almost like he is personally looking at all that I’ve been trying to accomplish financially, and then he totally tries to derail my efforts!
Sadly, most of my efforts have taken years to accomplish!
I feel this way because of the following:
- The President (and current administration) gave up to $8,000 dollars to first time home buyers of my tax money. This one still has stumped me? After all, if they don’t have a home to begin with, they won’t lose it to foreclosure…
- Later, existing homeowners were given a $6,500 tax incentive to become more in debt? That is exactly what happened to my neighbor (the Joneses). They went on to buy a house worth double the old value of their previous home. I hope their jobs are secure!
- Obama is working to get some of the debt on existing home forgiven?!? The people that he is targeting aren’t even the people who had their homes foreclosed already or currently. What kind of bizarro logic is this?
- Now I heard that he is going to raise the taxes on dividend yielding investments. I always though that taxing dividends was pretty unfair to begin with, and besides, it hits the boomer generation hardest. For someone (like me) starting down the road to becoming a dividend investor, this hurts! There are workarounds (moving all dividend stocks to Roth IRAs), but they require effort and additional tracking.
- Speaking of boomers, they shouldn’t be very happy either. Most of their mutual funds in their 401ks and IRAs held financial firms as prime assets. And most of these have been handcuffed and dividends stripped away. This will directly put a lot of retired boomers in a bad predicament that they wouldn’t be in otherwise.
I have to admit, the housing policy from this administration is a big slap in the face for me. To me, it seems that if you went beyond your budget and got a house too big, the government will take my tax money and help you live your too rich lifestyle. So if you make bad financial decisions, I’ll be paying your bill.
Am I wrong on how I interpret the actions of the government? What say you?
-MR
I feel the same. Bad money managers are being rewarded for their poor decisions. If I think of the folks I know that qualify, they are horrible with money.
I’ve been disappointed with most of Obama’s decisions so far. I hated most of bush’s decisions too. Maybe I just can’t be pleased.
Yeah, I have been disappointed with both of the last 2 presidents too.
Actually, I think Obama would be better if the Senate and Congress weren’t so democrat heavy. I think a more equal balance creates better laws and policies. Instead of everything just being rammed through by a party majority in both.
Sad that it has to be that way, huh…
There is a very warped sense of entitlement that I find to be shameful. We are entitled to the pursuit of happiness not to happiness. Arg!!!!!
Anyway, the dividend tax increase annoys me to no end for the same reason you stated.
I understand why they they did it, and it’s better than nothing, but I don’t think it’s the best idea either. I think they should have met with Buffett (only because he’s offered to help) and other business leaders before offering that solutions that they have offered.
I think I’m just sad about the dividends because I might miss those lower tax rates when I didn’t have stocks with dividend vs now.
Prez Obama hates me I know it! He probably wakes up thinking how can I make “MR” mad today! (lol)
He’s a great guy, and will be a well regarded president, but I don’t agree with his actions from a financial perspective…
Don, to clarify, how does he hate you exactly in terms of housing?
Were you snaked when you were looking to buy from someone who had a credit?
Actually, since I’ve paid off my mortgage, I’m more upset about the government pushing forgiveness loans and trying to change the principal that the interest that the loans are based on. To me that’s rewarding people for the wrong reasons!
This sentence is unrelated, but do you ever remember a president that is on the TV more?
The government isn’t about fairness, it is trying to make the housing market work again. The home credit was to get people to buy houses so prices would go up, so that foreclosures would be less likely to happen so that houses wouldn’t sit empty and destroy neighborhoods and lead to more crime. And it worked. Not perfectly, but compared to the counterfactual (what would have happened in its absence), it did what it was supposed to do.
One of my (hardcore conservative) colleagues thinks he should have done like FDR and have the US gov’t buy back the houses themselves, but the tax credit is a more market driven solution. And as a responsible homebuyer, you ARE benefiting from these policies– your house is not dropping in value as much as it would have without. Crime rates aren’t as high as they would be, meaning police departments aren’t as stressed as they would be etc.
As someone who teaches the role of government and how government works, I think the Obama administration is doing a competent job. Sure, there are things they could be doing better but politics ensures that they will never be able to. There are a lot of moral and ethical beliefs that will put folks on one part of production possibility frontier or another.
Liberals would argue that he’s trying to be like Clinton, but he should have been FDR. The daily show talks about how people expected him to walk on water, but just treading (or in a particularly good segment, to be that “magic negro” in movies who makes everything better, but that’s only a character in movies.) A lot of his policies that he’s gotten through are actually solid Republican policies of the type George HW would have made. He’s not really pleasing anybody, and there’s no way he could please everybody but he’s not screwing up which right now is enough for me.
We don’t make more than 250K so I’m not going to complain about raising the dividends tax bracket. I think it’s ridiculous that I’m taxed less on my dividends than I am on my salary as it is. That’s not a way to encourage productivity. Folks are constantly complaining about the deficit/debt but any suggestions to pay for it that will hurt the smallest number of people and do relatively little damage to the economy are shot down. People want spending without payment.
Most boomers coming up for retirement still have defined benefit pensions. And, I still have a very hard time feeling sorry for anybody who is making more than 250K/year (where the dividend tax marginally kicks in– first 250K are still at the old rate) as a married couple on dividend income alone. What must the untapped wealth be to do that? If they live in SF, their property tax rate is fixed and they’re living a pretty good life. Trying to squeeze out some pity for Manhattanites but failing. Besides, congress isn’t supporting the dividend tax increase anyway so it’s not going to happen.
And, I’m impressed with the great changes his administration has been implementing making the FAFSA more understandable (which has been shown to increase college attendance and graduation in a randomized experiment by a group of top economists). I like the new information on my credit card bill. I like the way he’s hired some really great economists (not Larry Summers– the ones who are actually quietly implementing these nudge policies). I like the way that he’s working on some very hard very unpopular problems that would have gotten much worse without intervention (like the upcoming Medicare deficit). It is the responsible thing to do even though it will hurt his popularity tremendously.
And the mideast peace talks– they’re getting farther than anyone in modern history.
So I understand why and how government works and how very difficult it is. And I cannot think of anybody who could do better except a few already dead presidents. It is not an easy job.
I disagree, but only mildly.
I don’t hire a roofer to do my taxes, nor does a roofer hire and DBA/system analyst to roof his ceiling.
I think Obama should be talking to sages like Buffett and other experience business leaders, instead trying off-the-cuff ideas from non-business people with respect to the economy. There’s a big different in running a company vs reading about how to run a company. So why not use these financial experts like Buffet? During the debates with McCain, Obama spoke about how Buffett was his friend and he would be consulting him, but Buffett said on TV that hasn’t happened and that Buffett would be glad to help.
Buffett, who by the way is a very solid Democrat, should have been, and still should be, consulted!
So, I give the president a C+ or B- so far (I just read that Obama only grades himself a B+). He’s not the worst president, but he not the best either.
Personally, I want the best qualified people in the government (after all, I’m paying for them), and sadly, I don’t think that’s currently the case.
Not that I was any happier with Bush either… I thought it was silly to cut taxes initially, now we have people that depend on the lower rates…
It’s frustating, but hasn’t it always been that way since the beginning of the US government?
IMHO, we are still the best country to live in… But only because of the fairness that should be in the system…
I just showed a video in my class of Buffett testifying to Congress.
Add to that that Tim Geitner (who I know everybody loves *sarcasm*) is a businessman. He’s got plenty of business-people consultants, not just from Wallstreet. They’re thinking of having one of them replace Summers. There are plenty of business people in government too.
Of course, the economics of the MARKET works differently than the economics of GOVERNMENT. Because the main purpose of GOVERNMENT is to intervene in cases of MARKET FAILURE. So it really doesn’t make sense to have only business people as economic advisers. It makes sense to have people who understand multiple issues.
Ross Perot is a good example of a guy who was dead wrong about a huge number of things, but is a great businessman.
Testifying before the senate and advising the President are 2 different things entirely.
Tim Geitner is trapped, I don’t think he’s too crazy about some of the policies either…
Ross Perot, I don’t really follow his political views (he’s before my time). So I’ll have to take your word on that one.
I do know that we aren’t the strong country we were 20 or even 10 years ago, and part of that is because of bad government decisions and laws from both parties!
It isn’t just Obama that hates you MR. This country seems to be hating anyone who is successful. You paid off your mortgage- what were you thinking? You saved money and invested in dividend yielding stocks – how awful. Don’t even think of making too much money or you will be deemed selfish and uncaring. America has lost respect for those who have worked hard and accomplished something. (Not all of America, obviously.)
But it does seem that the successful ones get punished. You can already take care of yourself, so why should anyone help you? I think we should help those that overbought and spent like there was no tomorrow. Wait, it is tomorrow… Oh well, let’s bail them out!!!
Sorry if this rant made no sense, I am tired…
No, you did an excellent job explaining how I feel! I agree 100% with your comment!
I used Obama because he was recognizable to people (although Barney Frank is pretty know too).
Rich bashing (hmmm, that might be a future post), is very popular in the US. Even when those biggest of Rich have given to charities for year and years.
From the book “The Millionaire Next Door” we know that most of the rich today come from the middle class (I think it was it almost 80%). So why do we want to tear down the ladders to get to the next level for the middle class? Seems kind of dumb to me…
Thanks for commenting, I thought I was off base for a moment 🙂
I couldn’t agree with you more. I haven’t been able to qualify for one program that would help me as an underwater homeowner, but I know darn well that my tax dollars are going towards ‘the help’ of others not to mention all the debt we’re incurring to actually be able to pay the bill.
Yeah, I don’t think what they are going in Washington DC is the best solution… Kind of half baked in my opinion.
President Obama doesn’t hate me, but I think that the premier of British Columbia does (we call him Gordon Scambell- he likes to say he wont add any sort of tax, and then adds an harmonized sales tax) lol
Great to read about some of the tax structures and policies down south!
Lol, I was thinking the same about Canada!
I’ve learned a lot from reading your site about the system up there and it sounds like we are more siimilar than not… In fact, in some ways it sounds like we are heading more towards some of the policies that Canada has (ex. Health Care)…
Canada’s health care might even be better than the USA since many aspects are privatized, yet not regulated to death or controlled by the insurance companies.
Where we suck big time though are the long waits for standard operations.
Some say that as government rides on the legitimacy of the people, that you get the government that you deserve, and that you can’t expect good results to come out of bad incentives.
What kind of cars do you think you would get if cars were funded solely through taxes, and people voted on what kind of cars should be produced and how?
I heard about the long waits… That’s definitely not a positive, that for sure.
If the government had to pick the type of car that everybody drove, then I guess it would either be a yugo (lol), or on of those tiny cars from Tata motors. It would be like the color choices of ford back in the old days, when the came in any color as long as you chose black.
Yeah, I’m not really a fan of socialism. I don’t think eveybody shouldn’t be forced to fit in a square hole.
Obama is doing things that we will look back on and lament! I’m not sure how someone can claim that we have less crime than we “would have”. How in the world do you know that? All he did was take people who wanted to buy in June and had them buy in April. So now with no more credit, there are no more buyers! All these credits do is pull demand forward!
The housing market is still tanking despite his idiotic efforts to reward people for foolish decisions and punish people who are disciplined!
Now he wants to tax anyone who was able to make something for themselves!
Great points! I agree 100%!
I have learned that Obama is more presentation that action. He snowed me at first, but now I understand.
Since most of those that are rich today come from the middle class, I think he’s missing the boat on that too. Is he trying to destroy people’s dreams? Is he the dream killer? We’ll see…
That guys! I think this my be my first post where the comment words total more than the post itself 🙂