Tuesday, August 24, 2010

Bush Tax Cuts - Now That’s Rich

Yesterday Paul Krugman wrotes on the Bush Tax Cuts - Now That’s Rich.

"What’s at stake here? According to the nonpartisan Tax Policy Center, making all of the Bush tax cuts permanent, as opposed to following the Obama proposal, would cost the federal government $680 billion in revenue over the next 10 years. For the sake of comparison, it took months of hard negotiations to get Congressional approval for a mere $26 billion in desperately needed aid to state and local governments.

And where would this $680 billion go? Nearly all of it would go to the richest 1 percent of Americans, people with incomes of more than $500,000 a year. But that’s the least of it: the policy center’s estimates say that the majority of the tax cuts would go to the richest one-tenth of 1 percent. Take a group of 1,000 randomly selected Americans, and pick the one with the highest income; he’s going to get the majority of that group’s tax break. And the average tax break for those lucky few — the poorest members of the group have annual incomes of more than $2 million, and the average member makes more than $7 million a year — would be $3 million over the course of the next decade."

And today he confirmed his math is right, Yes, $3 Million.


Karl said...

It bothers me when tax cuts are characterized as giving people money. I would say they are better described as letting people keep the money they earned.

All that aside, I think the report linked in the article had some interesting graphs showing the differences between the two plans.

I found the apparent contrast between figures 2 and 3 which display the same information, as percentages and flat dollars respectively, particularly interesting as a display of how hard data can still be manipulated for effect.

Howard said...

I agree, but of course it depends where you're starting from. If you're talking about the budget or the debt (or deficit) it seems ok.

I hadn't clicked through to that report. I think the difference best points out how large the gap is between the top 1% and the avg.

What I'd really like to see is some balanced reporting of what the money buys us. I'm ok with taxes if they are spent to build up society. The problem is that the ss, medicare and defense are such huge things that they dwarf all other spending. I'd really like to see something that said, $x of your taxes goes to FDA inspections and $y to highways and bridge reinforcements, and see what's reasonable to spend. The problem of course is that $z goes to war.

And while some will say $m to medicare is a gift to the poor, others might say that it goes to keeping grannie alive and away from death panels. I guess it does all depend on spin.