Tag Archives: Tax Cuts

Tax Cuts For Thee, Tax Cuts For Me

1 Aug

There is an impasse brewing in Washington over the Bush-era, post-9/11 stimulus made up entirely of income tax cuts. 

This is the same stimulus plan that has been in effect throughout the current economic uncertainty, and the recent global economic meltdown that took place, and has done little to make sure wealth trickles down, or to create jobs. 

It’s becoming part of the NY-27 race, in particular. Republican Chris Collins paints himself as the small business everyman, and called on Representative Kathy Hochul (D) to vote to extend tax cuts even to the wealthiest Americans.  Collins claims millions of small businesses, who aren’t hiring now, would be forced to not hire people (what, like even worser?!) if the Bush tax cuts for the wealthy aren’t extended. Essentially all of the $1 million+ earners in the country are not “small business owners”;  only about 2.5% of small businesses would be affected.  It would also expend the deficit by another trillion dollars, so it’s what we call “fiscally not particularly conservative”.

In fact, since Reaganomics and trickle down/supply-side economics became de rigeur,  wages haven’t stagnated for average Americans – they’e “plummeted”. Wealth hasn’t trickled down to anyone, unless maybe you own a Bentley or yacht dealership. 

No, we shouldn’t begrudge the rich their wealth. However they got it, they’re quite entitled to it. By the same token, we need to stop the hagiography about them being “job creators” without whom our civilization would crumble. Ayn Rand isn’t the treasury secretary. 

President Obama and the Democrats would like to put an end to the tax cuts to the wealthiest Americans. What does that mean? 

What it means is that everyone gets to keep the Bush-era tax cut up to the first $250,000 of annual income – even notable job creators like Paris Hilton and Kim Kardashian.  Here’s the average annual tax savings if the middle-income cuts are maintained, but the high-income cuts are abolished: 

Still a pretty good deal, right? Anyone else getting the idea that Collins’ argument is more about self-interest than policy?  The problem is that many genuine small businesses rely on the middle class to buy their goods and services – directly or indirectly. The best way for that to happen is for people to have money in their pockets and the confidence to spend it. Millionaires never, ever have a problem with either of those factors. As we see above, extending the middle-class tax cuts provide a significant benefit across the income spectrum.

Tax Cut Bill Brings Out The Best In Some Democrats

18 Dec

The Obama Tax Cut compromise-a-palooza bill was signed into law yesterday.  However, the weeks leading up to the passage of the bill were filled with passionate, full-throated defenses of the middle class from some very prominent Democrats on the floor of the house.  Most notably, the eight and a half hour floor speech given by Sen. Bernie Sanders (I-VT).

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From his website:

At 10:24 a.m. on Friday, Sen. Bernie Sanders walked onto the floor of the U.S. Senate and asked to speak. More than eight and a half hours later, after speaking almost non-stop and never once leaving the floor or even sitting, the senator concluded his remarks in which he laid out why exactly he opposes the tax cut agreement between the White House and congressional Republicans.

“In my view, the agreement they reached is a bad deal for the American people. I think we can do better,” Sanders said. The senator discussed the greatness of the nation: “I know my father came to this country at the age of 17 without a penny in his pocket. He became the proudest American one could ever see. He didn’t have much of an education, but he knew this country gave him a great opportunity. That is the American story. That is what it is all about.”

“I think the American people are saying, with a $13.8 trillion national debt, let’s not give tax breaks to billionaires and drive up that national debt, forcing our kids to pay more in taxes, and at the same time have Republicans coming forward to start slashing Medicare and Medicaid and Social Security because of this large debt that we are making larger.”

About a week previous, Sanders had taken to the floor of the Senate to give another rousing speech about the middle cllass and the war between the haves and have-nots in America.  It was the most honest speech given on the floor of the United States Senate in years.  It is absolutely must-see internet TV.

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Sanders wasn’t the only Senator or Representative to take to the floor to defend the middle class and argue against benefits for billionaires, Rep. Louise Slaughter (D, NY-28) also took to the microphone to explain why she was voting “no” on the Obama tax bill.

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Sen. Kirsten Gillibrand (D-NY) also voted “no” on the Obama tax cut bill.

“I’m opposing this deal in its current form because right now we need to focus on the middle class, who are always left behind, not the people at the very top, who are doing just fine in this economy.

“Although this deal includes important measures I have fiercely advocated for, extending Bush tax cuts for the very wealthy will saddle our children with billions of dollars of debt. With unemployment near 10 percent and a growing budget deficit, every dollar in this deal should be spent in a way that creates jobs and gets our economy growing, and tax cuts for millionaires and billionaires do not create jobs and will not help our economy grow. This kind of fiscal recklessness is bad for our economy and bad for future generations.”

There are still some liberal champions in the Congress.

White House White Board – Auto Industry

19 Nov

In the fourth edition of White House White Board, Austan Goolsbee, Chairman of the Council of Economic Advisers, discusses the President’s tough decisions on the American auto industry in light of the General Motors IPO.

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While the topic of GM’s bailout and whether it was worthwhile is an interesting discussion, I posted this more to illustrate another point.  President Obama is terrible at politics.  Saving GM should be a slam dunk issue and a huge boon to his approval ratings, especially in rust belt swing states like Ohio, Michigan and Pennsylvania.  Instead, he’s a reactionary politician who spends more time defending and explaining his positions than presenting them.

President Obama's Director of Heavy Political Lifting

It’s something that I didn’t see coming during the 2008 election, Candidate Obama seemed so adept at messaging and politics while President Obama fumfers and compromises and reacts.  What happened?  What’s the difference?

Right now, this cartoon explains where the President is at poltically:

The white board videos that Goolsbee is creating are a return to that simplicity of messaging, but they are on YouTube and not part of a massive messaging effort.  Goolsbee has just the type of demeanor the American public needs to see from this administration.  Get him in front of the media at every opportunity, make him the point man on economic issues and jobs.  He’s smart, funny, and can speak in the bullet point, bumper sticker style most Americans need in order to understand complicated issues.

Republicans are arguing (with a straight face) against extending unemployment benefits for millions of Americans while arguing to keep the tax cuts for the wealthiest 2% of Americans in place.  Doing so in the face of pluralistic public support for the President’s proposal.  He is being outflanked politically, he’s lost his narrative and he’s become the great compromiser.  He’s taken a conciliatory and defeatist approach to policy when we need a leader.  He’s alienating his base and a capitulation on the tax cut issue with the Republicans will only further disenfranchise the liberal and center-left base that got him elected.

This President needs to grow a set and soon or he’s going to find himself out on his ass in 2012.

A Stimulus That Worked

31 Jul

The Cash-For-Clunkers program is broke. After one week.

Clunker

All $1 Billion for the program, which was supposed to last til November, spent in one week, and the feds are having trouble keeping up with processing the forms.

All this while the Federal Stimulus Bill is roundly criticized for spending too little money too slowly.

Which begs the question: is there any better proof that private citizens spend money more effectively or efficiently than the government? Want to stimulate the economy? Incentives, rebates, and tax breaks.