Obama won't do this. It is too populist and simple. He would rather be Geithner's boss and hope that his wonkish advisors can do their thing, come up with something complicated without upsetting the elite. He would rather settle for mild admonishments for the unemployed to have patience. Let's hear why this should not be done by the usual crowd. I especially want to hear from Juicy Fruit who purports to make less than $20,000, lives on half that much, enjoys it and begrudges any government help to anyone who makes so much. Tax Jujitsu: Why Democrats Should Propose a "People's Tax Cut" Tuesday 24 August 2010 by: Robert Reich | Robert Reich's Blog | Op-Ed Republicans are calling the Democrat's proposal to end the Bush tax cuts on the richest 3 percent a "tax increase," and demagoging that it will hurt the economy and small business. This is baloney, to put it politely. Let me count the ways: • Bush's ten-year tax cut was designed to end this year, so it's not a tax increase. • Ending it for the rich simply returns them to the Clinton tax rate, which was hardly confiscatory (reminder: the Clinton years were damn good for business). • Small businesses would barely be affected. Only 3 percent of small business owners earn over $250,000. And because it's a "marginal" tax, the Clinton rate would apply only to the portion of their incomes over $250,000. • Yet extending the Bush tax cut to the richest Americans would give them a $36 billion bonus next year. ($31 billion of this would go to billionaire households.) And that $36 billion would be added to the budget deficit. • And it wouldn't even stimulate demand and jobs, because the very rich save (rather than spend) more of their disposable income than the rest of us. • Finally, ending the Bush tax cut for the top is fair. Income inequality has become so grotesque that the top 3 percent of households rake in almost a third of total income (the highest portion since 1928). •But by the time Democrats explain all this, it's too late. The Republican furor over a "tax increase" has framed the debate. Republicans understand the art of tax demagoguery: Put the other side on the defensive by forcing them to explain why a "tax increase" is warranted and they lose regardless. So instead of playing defense, Democrats should go on the attack. Accuse Republicans of being shills for the rich. And don't stop there. Do tax jujitsu. In addition to ending the Bush tax cut for the rich, put forward another proposal for growing the economy that cuts taxes on lower-income Americans. Democrats should propose eliminating payroll taxes on the first $20,000 of income, and making up the revenue loss by applying payroll taxes to incomes above $250,000. This would give the economy an immediate boost by adding to the paychecks of just about every working American. 80 percent of Americans pay more in payroll taxes than they do in income taxes. And because lower-income people would get most of the benefit, it's likely to be spent. It would also give employers an extra incentive to hire because they'd save on their share of the payroll tax. And most of the incentive would be directed toward hiring lower-income workers – who have taken the biggest hit on jobs and pay during the recession. It wouldn't add to the deficit. Lost revenues would be made up by applying payroll taxes to income exceeding $250,000. This is certainly fair. As it is now, the Social Security payroll tax doesn't apply to any income over $106,000. Having the tax kick in again at $250,000 would draw on the top 3 percent of earners, who (as noted) now rake in a larger portion of total income than they have in more than 80 years. Call it the People's Tax Cut, and let Republicans explain why they're against it. http://www.truth-out.org/robert-rei...mocrats-should-propose-a-peoples-tax-cut62665
That would edge towards... *drumroll* SOCIALISM! In reality, I think it's a fine idea and sounds good to me. However, also in reality, the Republicans (and TEA Partiers, etc.) will no doubt frame it as yet another step from Obama towards socialism and voters will immediately turn against it even if it's in their best interest. Why? Because they're stupid.
Or just draw a arbitrary line at 250k, pit one side against the other. If you want to raise more taxes on the top bracket, why be afraid of people calling it socialism, it is what it is. Top 1% income earner already pays more income tax than the bottom 95% combined, its no wonder Robert Reich is going after the payroll tax now.
An article came out awhile back stating that 40% of Americans pay no income tax. I posted it on a Con heavy board touting it as success since they always want lower taxes. What was their response? "Lazy good for nothing $%%^#$ they don't pay their fair share!!!!" Point of the story Republicans will not be happy about the tax situation no matter what.
Do this and abolish the corporate income tax, and hiring would explode. But it is an article of faith on the left that tax cuts do not promote growth, for Obama to concede that would be sacrilege.
It is actually an article of faith among mainstream economists. There are a few right wing economists who dissent and of course dominate Fox and conservative libertarian forums largely funded funded by right wing billionaires.
any line that you ever draw arguably is arbitrary. but 250k is obviously a very good income, which allows a fairly comfortable lifestyle and allows planning for significant financial security (yes perhaps not in manhattan). thus its a reasonable number. actually that isn't socialism. if you want to call something socialism, you should dedicate some time to learn what the word means. m-w firstly, once again, you are either a liar or just don't know stuff you talk about. the top 1% as ranked by AGI paid 40% in 2007. they also make a lot more than the 250k you threw out, at least in 2007, the threshold for top 1% of households was 410k AGI. right winged source regardless, the top 1% also have a grossly unfair and inequitable amount of wealth. in fact, the richest of them have gained tremendously by tax cuts, resulting in a depressingly disproportionate amount of net gain of post-tax income relative to others over the past two decades. the absurdity of paying for the wars or the necessary future stimulus by lowering taxes on the rich (who are hoarding money right now) and/or raising taxes on the poor (who provide stimulus) is obvious.
we had a fairly wealthy friendly tax policy over the past 10 years and yet we created few if any jobs. care to explain why your tax policy has no merits?
Take a look at this graph, Tax Burden of Top 1% Now Exceeds That of Bottom 95% http://www.taxfoundation.org/taxdata/show/24955.html Maybe you should check out the facts before calling someone a liar. Nobody is raising taxes on the poor, the lower income bracket already pays very little income tax (bottom 50% pays 2.9% of the total income tax), so FICA naturally would be only major tax left we can lower. And its not a bad idea, also uncapping ss tax would probably be good for long term health of ss. But it is what it is, re-distribution of wealth.
i read your post wrong. so i do apologize for that. that being said, the wealth of the top 1% is also enormous. quick google link. and thus you're whole rant is misplaced and wrong. this in addition to the fact that local taxes are for the most part regressive.
Tax cuts are great and all, but maybe we should focus on, you know, reducing spending to justify tax cuts, and, you know, maybe stop having the Fed inflate our money supply and manipulate the markets on a daily basis so that we can throw money everywhere at everything while devaluing our currency. This sort of "superficialism" we see from our government, no matter which one of the big parties is seemingly in control, is what pisses me off.
I like Reich's idea. I just wish the administration did, and wonder why they didn't go this route a long time ago. As for those lunatics who call this "socialism," give me a ****ing break. It is TAX POLICY, nothing more. It is no different than Bush's giveaways to the rich. One could call that socialism for the wealthy just as easily as one could call Reich's proposal "socialism." In fact, I'm glad some fools are using the term in this instance. It shows just how bankrupt their philosophy is. Do they truly believe the American people so stupid that they can't see the difference? Apparently they do. It's past time to educate both them and the American People that we can and will take a different path with tax policy that will benefit those who really need reform... the Middle Class. Time for the Administration to get out in front with this issue. Past time.
pisses me off too.. unfortunately neither party wants to cut spending. They both have their agendas ...
After 30+ years of re-distributing wealth to the upper few percent, perhaps it's time we re-distribute some of it back down.
I would call it distribution of wealth. "Redistribution" pretends like the prior distribution was the correct one.
