I read an article recently which, in defense of extending the Bush-era tax cuts to the wealthy, claimed that those in the upper-incomes pay seventy-something percent of all taxes. For the sake of argument, let's say that they pay 75%.
I'm reminded of my college sociology class where the professor said that despite stereotypes, people would be "shocked" to hear that white people actually make up the majority of prisoners in the penal system. My first thought was, "That's because there's more white people in the country. Duh!"
By the same token, it would make sense to me that the wealthy pay 75% of the country's taxes as they bring in (at least) 75% of the country's revenue. "Duh!" We're not even accounting for international tax shelters and other options to which the lower and middle classes don't have access.
At best, fiscal conservatives may say that the lack of upper-income tax cuts on financial and employment recovery was due to concern about fighting two wars during the first six years and insecurity about presumably "anti-business" Democratic goals during the last four years.
At worst, I believe that the wealthy, just like most everyone else in these economic times, simply held onto their money to preserve their standard of living.
In the end, it would appear that Democratic Congress members from moderate-to-conservative states who, fearing a later Tea Party-fueled backlash, will not cap an extension of the Bush-era tax cuts during the upcoming lame duck session. Given that the Bush/Obama stimulus packages have had all of two years to work, it will be interesting to see how rapidly the extended tax cuts "trickle down" for the greater good over the next two years.
Friday, November 19, 2010
Wednesday, November 3, 2010
November 3, 2010 - The Aftermath
OK...
So I was not too surprised at last night's election results. I had become convinced that the House of Representatives would be switching to the GOP although I had hoped (correctly) that the Democrats would be able to hold onto the Senate. I only hope that the Administration and Congress can find some common ground to move the country forward instead of just pre-gaming for 2012. The Clinton/Gingrich years, where compromises like welfare reform were accomplished, would be a better model than the Bush/Pelosi years which were largely filled with gridlock.
Despite the wishes of Boehner and Co., I don't think cutting both taxes and spending will be any more effective in general than raising both of them. One will have to go in the opposite direction of the other. As I often say here, each end of the economic spectrum can do more to contribute to the common good even in these tough times. However, while the lowest-income households can only contribute increased effort, the highest-income households already possess enough access to informational and financial resources to withstand a temporary sacrifice. I don't believe a combination of voluntary charity and compulsory bootstrap-pulling will be enough to make up the difference.
I predicted two years ago that if Obama and the Democratic Congress emulated the no-compromise style of the Bush Administration and Republican Congress, then they too would lose their government monopoly. Unfortunately, this scenario has come to pass; I just didn't think that it would happen in only two years. Then again, for fiscal conservatives that gritted their teeth through eight years of "Big Government" Republican policies under Bush only to be confronted with "Even Bigger" Government under Obama, the Tea Party was a reaction whose voice was heard. (Edit after first two replies: Granted, Tea Partiers and mainstream Republicans alike have railed against the possibility of the "biggest tax increase in history"...which of course follows the biggest tax decrease in history from which upper-income households benefitted the most. However, the intended "trickle-down" effect from said households appears to have been, at best, no more materially effective over the last nine years at saving or creating jobs than has Obama's two-year-old stimulus package.) At least Boehner admits that this opportunity is not a mandate so much as an audition. Let's just hope that beyond the soundbite rhetoric, substantive work can actually get done over the next two years.
So I was not too surprised at last night's election results. I had become convinced that the House of Representatives would be switching to the GOP although I had hoped (correctly) that the Democrats would be able to hold onto the Senate. I only hope that the Administration and Congress can find some common ground to move the country forward instead of just pre-gaming for 2012. The Clinton/Gingrich years, where compromises like welfare reform were accomplished, would be a better model than the Bush/Pelosi years which were largely filled with gridlock.
Despite the wishes of Boehner and Co., I don't think cutting both taxes and spending will be any more effective in general than raising both of them. One will have to go in the opposite direction of the other. As I often say here, each end of the economic spectrum can do more to contribute to the common good even in these tough times. However, while the lowest-income households can only contribute increased effort, the highest-income households already possess enough access to informational and financial resources to withstand a temporary sacrifice. I don't believe a combination of voluntary charity and compulsory bootstrap-pulling will be enough to make up the difference.
I predicted two years ago that if Obama and the Democratic Congress emulated the no-compromise style of the Bush Administration and Republican Congress, then they too would lose their government monopoly. Unfortunately, this scenario has come to pass; I just didn't think that it would happen in only two years. Then again, for fiscal conservatives that gritted their teeth through eight years of "Big Government" Republican policies under Bush only to be confronted with "Even Bigger" Government under Obama, the Tea Party was a reaction whose voice was heard. (Edit after first two replies: Granted, Tea Partiers and mainstream Republicans alike have railed against the possibility of the "biggest tax increase in history"...which of course follows the biggest tax decrease in history from which upper-income households benefitted the most. However, the intended "trickle-down" effect from said households appears to have been, at best, no more materially effective over the last nine years at saving or creating jobs than has Obama's two-year-old stimulus package.) At least Boehner admits that this opportunity is not a mandate so much as an audition. Let's just hope that beyond the soundbite rhetoric, substantive work can actually get done over the next two years.
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