Saturday, October 2, 2010

Why Are We Arguing Over Tax Cuts For The Rich?

Let's get our priorities straight.  So says the Center For American Progress in this article.

There is agreement between Democrats and republicans that the Bush tax cuts should be extended to the poor and middle class, essentially everyone earning $250,000 per year.  That covers 98% of the American people.  The Democrats and republicans AGREE (will wonders never cease!) on tax policy for 98% of the people.  Yet republicans are willing to let the republican Bush tax cuts expire and result in a republican tax increase for everyone if the cuts are not extended for the top 2% also.

Let's see who has been hurt by the recent recession.  Here is a figure from the above referenced article.

Well, look at that!  The top 1/5 of people were hurt the least in 2007 - 2008 and have recovered the most in 200-2009.  In fact, their income is going up again, while everyone else's is still declining.

So here is what we are arguing about -- extending tax cuts for people who have already recovered from the negative effects of the recession.  We are arguing about tax cuts for the wealthiest 2% of the population.  These are people earning over $250,000 per year.

Extending tax cuts to these people will cost ALL of us about $800,000,000,000 (800 billion) dollars over 10 years.  Eighty percent of that benefit ($640,000,000,000) will go to people earning over $1,000,000 per year and their average tax cut will be more than $100,000. That’s almost twice what the median American household makes in a year. 

Where is the sense in that?  We are arguing about going almost 1 TRILLION DOLLARS IN DEBT in order to give people who have already recovered from the recession more money.

How much money is that?  It is the cost of the healthcare bill over 10 years.  And healthcare is paid for.  That was a big issue.  This is a giveaway to people who do not need it.  It is NOT paid for.  They will get it only because they are rich and powerful.


  1. Let's see...could it be that many of the dissenting Republicans fall into that 2% income bracket? I wonder.

  2. I'm still seeing those in the middle class loosing their homes and know that many more will happen next year. Think of the loss of wealth there.

  3. You are right, Demeur. And guess who will gain that lost wealth?

  4. "We are arguing about tax cuts for the wealthiest 2% of the population.  These are people earning over $250,000 per year."

    Since when does income = wealth?

  5. You are right. Income does not equal wealth...although most, but maybe not all wealthy earn over 250000 per year. We are arguing over couples whose taxable income (not gross income) is over 250000 per year. The minimum taxable income for individuals is a little lower. This still about 2%.