Today as I was shelling out $450 to have my tires replaced I thought of a pledge President Barack Obama made over and over again not to raise taxes on anyone making less than $250,000 a year.
Notice the detail where he said there will not be an increase in "any" form of a tax increase.
So then how do you explain the 25 percent tariff he put on imported Chinese tires?
Dylan Matthews of the Washington Post reveals the policy was a massive failure:
The best evaluation of the program comes from Gary Clyde Hufbauer and Sean Lowry at the Peterson Institute. Theirstudy found that after Obama imposed the tariffs, employment in the U.S. tire industry grew by 1,200 jobs. Hufbauer and Lowry figure that this is the maximum number of jobs the tariffs could have created or saved, a generous assumption given that tire employment was already trending upward.
How much did those 1,200 jobs cost? About $1.1 billion, Hufbauer and Lowry found, all borne by consumers who were forced to pay higher American prices for tires, prices which shot up still higher when freed from competition with China.
As Milton Friedman often reminded us, the person who writes the check is not always the one who pays the tax. Consumers like me who make far less than $250,000 annually are the ones that paid that tax. It is likely I personally did not, as the program expired in September and I bought mine today, but that's just because my timing was fortunate. The president's promises to make our overwhelmingly progressive tax system more progressive are flawed as long as he continues to intervene in the economy and impose stealth taxes.