New Tax Bill Gives Increased Child Care Credit to Parents...But Not if they are Poor?

WASHINGTON - The Senate voted Thursday to give 6.5 million low-income families a check worth $400 for each of their children, as Republicans buckled under demands from Democrats to make more low-wage workers eligible for an increased child tax credit.

"These are hardworking couples who put in a hard day's work," said Democrat Blanche Lincoln of Arkansas, who pressured Republicans to revisit the tax cut President Bush signed in May. "They're trying desperately to raise a family."

The House must act on the legislation

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20030605/ap_on_go_co/congress_taxes

 

Really, never heard of SDI (phased out after like 75K and really twice as expensive as it appears on most paychecks), Medicare, state (most states have income tax) and local taxes.

Regardless of whether the income tax credit described should be adjusted for the lower income families (I think it should, or maybe not for consistency sake, but then make SDI progressive)--dumbass misleading statements like this need to be exposed.

 

Good to see the Dems hold firm and embarass the Republicans to actually be compassionate conservatives for a change.

The true social Darwinists on the bbs, probably object since it could aid the poorer income groups to reproduce.

 

As a business owner I have seen the holes in the system and the ability of individuals to manipulate the government and my tax dollars.

I can't even recall how many filing clerks/data entry young girls we've hired that had one or two children that decided that another child or two and they recieve more money in welfare and don't have to pay for a day care so the best scenario is to sit at home, collect checks and hang out.

Why should we give a check of $400 to low income families with children?? The whole "they are trying to raise a family" argument is bull****, because you are perpetuating that sort of behavior by giving handouts.

There is a difference between a tax-cut on people, essentially taking less of what they are paying in taxes, versus a hand out.

The way some people make it seem, its a crime to make a lot of money and you should somehow feel guilty about it. Bull****.

 

I'm not really upset or anything about this decision...I mean, ultimately it does put money into the hands of consumers. But Khan is right here. Let's call it what it is...it's a handout. It has zero to do with what was paid in. The only reason it's $400 is because that's the difference between what I already paid and what the new credit is. There is no rational relationship between those who paid no taxes and this $400 tax credit offset.

 

You don't want a working mother to receive a tax credit incentive even if more than they paid in federal income tax that might keep them working yet are b****ing if they quit because they can make in the same ballpark - child care expenses on welfare, wonderful. Doing the former (income tax credit) is an incentive to keep them working! Oh, I know, both welfare and other incentives should be taken away period--that it fix the problem--I wish more neocons in political power would be as honest and up front as you are.

Again the whole federal income tax discussion is meaningless w/o considering other taxes including SDI, Medicare, state (most states have income as well as sales) and local taxes. Further, some of those other taxes are regressive in that they are phased out at higher income levels.

 

The "uber-rich" meaning any family with a combined salary of $26,625 and up? Wow, I had no idea I was so rich!

 

Redistribution of wealth, the first signs of socialism.

Why not just let the people who take the risks get the rewards?

Why should we punish the rich, because they can afford it....baloney.

If you worked your A$$ off and got rich, you certainly don't want to be giving government mandated handouts to people who don't deserve them.

I guess some people are just accepting the fact that they won't ever be rich...not me, I am still striving baby.

Oh, and if you don't pay taxes in the first place you should not get any money back.

Ridiculous.

DD

 

It's class warfare/class envy, DD. As long as the libs continue to perpetuate it, they will continue to have their power.

You don't get a tax cut if you don't pay taxes. How can people not understand this? You can't save 50% at a 50% off sale if you don't buy anything. The more money you make, the more taxes you pay, the more money you get back from tax cut. It's just so simple.

 

At least you guys (DD, drummer, FD) are honest about your views. Wish the mainstream Repb. was so about their agenda.

Interesting how the richest man in America is for the inheritance tax and has a huge philanthropy foundation. I guess he has different views on appreciating how his great country and citizens provided an avenue for his personal successes and believes in encouraging/helping others in our great country.

BTW we already have socialism in our country—social security and Medicare being the largest socialistic programs. But I assume you guys want to do away with those, again wish all the people you vote for were as honest about it.

Finally, you guys just can’t seem to get this strait or you just dodge and dodge and dodge. Federal income taxes are just 1 of many taxes, some of the others of which are regressive. To focus on FIT in isolation is completely misleading and uninformative.

 

What's the big deal? They are rewarding their constituency. This is the way politics works. I think they may have to backtrack because they forgot many serviceman fit this category and they are mostly in the Republican constituency.

 

I am not sure how much enlisted men vote republican--I wouldn't be surprised if it was pretty split, though I'll bet the wide majority of officers vote Repb.

 

good article:



--------------------------------------------------------------------------------

June 8, 2003
Deficits and Dysfunction
By PETER G. PETERSON


have belonged to the Republican Party all my life. As a Republican, I have served as a cabinet member (once), a presidential commission member (three times), an all-purpose political ombudsman (many times) and a relentless crusader whom some would call a crank (throughout). Among the bedrock principles that the Republican Party has stood for since its origins in the 1850's is the principle of fiscal stewardship -- the idea that government should invest in posterity and safeguard future generations from unsustainable liabilities. It is a priority that has always attracted me to the party. At various times in our history (especially after wars), Republican leaders have honored this principle by advocating and legislating painful budgetary retrenchment, includinrg both spending cuts and tax hikes.

Over the last quarter century, however, the Grand Old Party has abandoned these original convictions. Without ever renouncing stewardship itself -- indeed, while talking incessantly about legacies, endowments, family values and leaving ''no child behind'' -- the G.O.P. leadership has by degrees come to embrace the very different notion that deficit spending is a sort of fiscal wonder drug. Like taking aspirin, you should do it regularly just to stay healthy and do lots of it whenever you're feeling out of sorts.

With the arrival of Ronald Reagan in the White House, this idea was first introduced as part of an extraordinary ''supply-side revolution'' in fiscal policy, needed (so the thinking ran) as a one-time fix for an economy gripped by stagflation. To those who worried about more debt, they said, Relax, it won't happen -- we'll ''grow out of it.'' Over the course of the 1980's, under the influence of this revolution, what grew most was federal debt, from 26 to 42 percent of G.D.P. During the next decade, Republican leaders became less conditional in their advocacy. Since 2001, the fiscal strategizing of the party has ascended to a new level of fiscal irresponsibility. For the first time ever, a Republican leadership in complete control of our national government is advocating a huge and virtually endless policy of debt creation.

The numbers are simply breathtaking. When President George W. Bush entered office, the 10-year budget balance was officially projected to be a surplus of $5.6 trillion -- a vast boon to future generations that Republican leaders ''firmly promised'' would be committed to their benefit by, for example, prefinancing the future cost of Social Security. Those promises were quickly forgotten. A large tax cut and continued spending growth, combined with a recession, the shock of 9/11 and the bursting of the stock-market bubble, pulled that surplus down to a mere $1 trillion by the end of 2002. Unfazed by this turnaround, the Bush administration proposed a second tax-cut package in 2003 in the face of huge new fiscal demands, including a war in Iraq and an urgent ''homeland security'' agenda. By midyear, prudent forecasters pegged the 10-year fiscal projection at a deficit of well over $4 trillion.

So there you have it: in just two years there was a $10 trillion swing in the deficit outlook. Coming into power, the Republican leaders faced a choice between tax cuts and providing genuine financing for the future of Social Security. (What a landmark reform this would have been!) They chose tax cuts. After 9/11, they faced a choice between tax cuts and getting serious about the extensive measures needed to protect this nation against further terrorist attacks. They chose tax cuts. After war broke out in the Mideast, they faced a choice between tax cuts and galvanizing the nation behind a policy of future-oriented burden sharing. Again and again, they chose tax cuts.

The recent $10 trillion deficit swing is the largest in American history other than during years of total war. With total war, of course, you have the excuse that you expect the emergency to be over soon, and thus you'll be able to pay back the new debt during subsequent years of peace and prosperity. Yet few believe that the major drivers of today's deficit projections, not even the war on terror, are similarly short-term. Indeed, the biggest single driver of the projections, the growing cost of senior entitlements, are certain to become much worse just beyond the 10-year horizon when the huge baby-boom generation starts retiring in earnest. By the time the boomer age wave peaks, workers will have to pay the equivalent of 25 to 33 percent of their payroll in Social Security and Medicare before they retire just to keep those programs solvent.

Two facts left unmentioned in the deficit numbers cited above will help put the cost of the boomer retirement into focus. First, the deficit projections would be much larger if we took away the ''trust-fund surplus'' we are supposed to be dedicating to the future of Social Security and Medicare; and second, the size of this trust fund, even if we were really accumulating it -- which we are not -- is dwarfed by the $25 trillion in total unfinanced liabilities still hanging over both programs.

A longer time horizon does not justify near-term deficits. If anything, the longer-term demographics are an argument for sizable near-term surpluses. As Milton Friedman once put it, if you cut taxes without cutting spending, you aren't really reducing the tax burden at all. In fact, you're just pushing it off yourself and onto your kids.

You might suppose that a reasoned debate over this deficit-happy policy would at least be admissible within the ''discussion tent'' of the Republican Party. Apparently, it is not. I've seen Republicans get blackballed for merely observing that national investment is limited by national savings; that large deficits typically reduce national savings; or that higher deficits eventually trigger higher interest rates. I've seen others get pilloried for picking on the wrong constituency -- for suggesting, say, that a tax loophole for a corporation or wealthy retiree is no better, ethically or economically, than a dubious welfare program.

For some ''supply side'' Republicans, the pursuit of lower taxes has evolved into a religion, indeed a tax-cut theology that simply discards any objective evidence that violates the tenets of the faith.

So long as taxes are cut, even dissimulation is allowable. A new Republican fad is to propose that tax cuts be officially ''sunsetted'' in 2 or 5 or 10 years in order to minimize the projected revenue loss -- and then to go out and tell supporters that, of course, the sunset is not to be taken seriously and that rescinding such tax cuts is politically unlikely. Among themselves, in other words, the loudly whispered message is that a setting sun always rises.


What's remarkable is how so many elected Republicans go along with the charade. The same Republican senators who overwhelmingly approved (without a single nay vote) the Sarbanes-Oxley Act to crack down on shady corporate accounting of investments worth millions of dollars see little wrong with turning around and making utterly fraudulent pronouncements about tax cuts that will cost billions or, indeed, even trillions of dollars.

For some Republicans, all this tax-cutting talk is a mere tactic. I know several brilliant and partisan Republicans who admit to me, in private, that much of what they say about taxes is of course not really true. But, they say, it's the only way to reduce government spending: chop revenue and trust that the Democrats, like Solomon, will agree to cut spending rather than punish our children by smothering them with debt.

This clever apologia would be more believable if Republicans -- in all matters other than cutting the aggregate tax burden -- were to speak loudly and act decisively in favor of deficit reductions. But it's hard to find the small-government argument persuasive when, on the spending front, the Republican leaders do nothing to reform entitlements, allow debt-service costs to rise along with the debt and urge greater spending on defense -- and when these three functions make up over four-fifths of all federal outlays.

The starve-government-at-the-source strategy is not only hypocritical, it is likely to fail -- with great injury to the young -- once the other party decides to raise the ante rather than play the sucker and do the right thing. When the Democratic presidential contender Dick Gephardt proposed in April a vast new national health insurance plan, he justified its cost, which critics put at more than $2 trillion over 10 years, by suggesting that we ''pay'' for it by rescinding most of the administration's tax legislation. Oddly, it never occurred to these Republican strategists that two can play the spend-the-deficit game.

Not surprisingly, many Democrats have thrown a spotlight on the Republicans' irresponsible obsession with tax cutting in order to improve their party's image with voters, even to the extent of billing themselves as born-again champions of fiscal responsibility. Though I welcome any newcomers to the cause of genuine fiscal stewardship,

I doubt that the Democratic Party as a whole is any less dysfunctional than the Republican Party. It's just dysfunctional in a different way.

Yes, the Republican Party line often boils down to cutting taxes and damning the torpedoes. And yes, by whipping up one-sided popular support for lower taxes, the Republicans pre-empt responsible discussion of tax fairness and force many Democrats to echo weakly, ''Me, too.'' But it's equally true that the Democratic Party line often boils down to boosting outlays and damning the torpedoes. Likewise, Democrats regularly short-circuit any prudent examination of the single biggest spending issue, the future of senior entitlements, by castigating all reformers as heartless Scrooges.

I have often and at great length criticized the free-lunch games of many Republican reform plans for Social Security -- like personal accounts that will be ''funded'' by deficit-financed contributions. But at least they pretend to have reform plans. Democrats have nothing. Or as Bob Kerrey puts it quite nicely, most of his fellow Democrats propose the ''do-nothing plan,'' a blank sheet of paper that essentially says it is O.K. to cut benefits by 26 percent across the board when the money runs out. Assuming that Democrats would feel genuine compassion for the lower-income retirees, widows and disabled parents who would be most affected by such a cut, I have suggested to them that maybe we ought to introduce an ''affluence test'' that reduces benefits for fat cats like me.

To my amazement, Democrats angrily respond with irrelevant cliches like ''programs for the poor are poor programs'' or ''Social Security is a social contract that cannot be broken.'' Apparently, it doesn't matter that the program is already unsustainable. They cling to the mast and are ready to go down with the ship. To most Democratic leaders, federal entitlements are their theology.


What exactly gave rise to this bipartisan flight from integrity and responsibility -- and when? My own theory, for what it's worth, is that it got started during the ''Me Decade,'' the 1970's, when a socially fragmenting America began to gravitate around a myriad of interest groups, each more fixated on pursuing and financing, through massive political campaign contributions, its own agenda than on safeguarding the common good of the nation. Political parties, rather than helping to transcend these fissures and bind the country together, instead began to cater to them and ultimately sold themselves out.

I'm not sure what it will take to make our two-party system healthy again. I hope that in the search for a durable majority, Republicans will sooner or later realize that it won't happen without coming to terms with deficits and debts, and Democrats will likewise realize it won't happen for them without coming to terms with entitlements.

Whether any of this happens sooner or later, of course, ultimately depends upon the voters. Perhaps we will soon witness the emergence of a new and very different crop of young voters who are freshly engaged in mainstream politics and will start holding candidates to a more rigorous and objective standard of integrity. That would be good news indeed for the future of our parties.

In any case, I fervently hope that America does not have to drift into real trouble, either at home or abroad, before our leaders get scared straight and stop playing chicken with one another. That's a risky course, full of possible disasters. It's not a solution that a great nation like ours ought to be counting on.



Peter G. Peterson is chairman and co-founder of the Blackstone Group and chairman of the Federal Reserve Bank of New York. He served as secretary of commerce under President Nixon.




Copyright 2003 The New York Times Company

 

Which, ironically, would also have a far greater economic stimulus effect rather than long term giveaways to the richest.

 

What interests me, more than the actual issues, is the debate on these issues. Or the lack thereof. You can't watch a "news network" and receive actual political information outside of who got elected.

What depresses me is how many seemingly intelligent people watch shows like Crossfire or the Fox programs for more than entertainment value. Hello! It's all bull**** from both sides.

First, you've got the ideologues decrying the other side's philosophy. But, of course, their claims are always non-unique with programs that they themselves support. They state their arguments as absolutes - but, of course, they're not - they're just arguing about where the line should be drawn, and seldom offer any real arguments about the line itself, just the greatness of their "end" of the spectrum. Tells us nothing, since on most issues that are worth talking about, both "ideals" have some value.

Then, you've got deceptive #'s once you even get into the policy debate. That's even when the #'s they're giving are even relevant to the situation they're talking about.

Has it always been this bad (question for those older than 23)?

 

Families earning under 26,000 are not only not paying federal income tax, with earned income tax credits and child tax credits, they get payments in the 1000's of dollars. They simply lost out on an increase in this payment, at least at the moment.

 

Damn haven, you've posted 2 thoughts that I've thought about just in the recent days. One thing I find incredibally funny about these debate shows is how the sides never really talk to each other. They just ignore each other and try to take shots at either Bush or Clinton, and when all else fails they'll throw out a "Compassionate Conservative, Leave no child behind." or a "You're paying off the rich and screwing everyone else!" You go through an entire hour long show, and not one question is answered.

I personally watch the shows for entertainment value more than anything...

 

pol·i·tics

The often internally conflicting interrelationships among people in a society.

The art or science of government or governing, especially the governing of a political entity, such as a nation, and the administration and control of its internal and external affairs.

Usage Note: Politics, although plural in form, takes a singular verb when used to refer to the art or science of governing or to political science: Politics has been a concern of philosophers since Plato.

 

And Plato was greek! See, everything is from Greece.