Ending Bush Tax Cuts for the Wealthiest 2% of Americans

Much is being said right now on both sides of the political spectrum with regards to the impending expiration of the Bush Tax Cuts, first enacted through Budget Reconciliation in 2001, and again in 2003.

Republicans, tride & true to their ideology of deficit financed tax cuts, are foaming at the mouth over the prospect of the wealthiest 2% of Americans having a tax increase. Many of the same talking points used in the 90's are being recycled in Cable News. It's the, "largest tax increase in history." It will "destroy the economic recovery" and "kill jobs."

From the sound of it, just listening the the right wing side of things, you'd think that Obama was hijaking the country and personally robbing the piggy banks of hard working Americans and leaving them bread crumbs to survive on. Maybe it's time to get real about tax policy. Unfortunately, by doing so - you'll discover that it's really just protecting the affluent.

Yes, if the Bush Tax Cuts are to expire - under the Obama plan, the marginal tax rate for people earning more than $250k will increase.
They will increase by a whopping.......drumbroll please........3.6%!
Wait, that's it? 3%? The wealthiest 2% of Americans are going to have to cough up an extra 3%. yes. That's correct. When I told a few of my "Conservative" friends that's all it was they thought I was making it up. Google it, it's after midnight and I don't feel like adding links.

Not to mention, this is the same marginal tax rate under the Clinton Administration, which led to a balanced budget and surplus going toward deficit reduction, and the creation of 23 million jobs. By comparison, the Bush Tax Cuts for the Wealthy created no job growth during the first two years and during the entire Bush Presidency only managed to squeak out 3 million jobs.

President Obama has already CUT taxes for 95% of Americans. Yes, he CUT taxes for the average joe. Even Joe the "Plumber." This "Tax & Spend Liberal cut taxes for 95% of Americans, re-enacted "Pay Go" and a Discretionary Budget freeze, formed a bi-partisan deficit reduction Congressional Pannel (opposed by Republicans), and has campagned on eliminating all taxes for seniors earning less than $50k / year.

So, in order to give the appearance that the Republicans aren't just doing the bidding of the wealthy, they've come up with this strategy claiming that, Obama's tax increase on the top 2% will hit small business and therefore put millions more people out of work and standing in line at a soup kitchen.

Of course - this couldn't be further from the truth.
First off, less than 1/2 of 1% of all small business actually make $250k. So the arguement the Right is making claiming that this new tax rate will hit "50% of small business" is BS. For a really good breakdown on this issue, read this article by Scholars & Rogues. The average taxable income from small business is around $45,000. So, in effect, under the Obama plan, the average small business would receive a tax REDUCTION. This could potentially lower the failure rate of small business and accordin to this study, actually CREATE 300,000 jobs a year. Not put millions in the street. For more about the fake arguement from the right, read the non-partisan Politifact Artical on the subject. From what I can tell, maybe 2% of small business will see a 3.6% increase in their marginal tax rate. That's also of course if the proprietor of the business is drawing a salary more than $250k. There's a huge difference between personal income tax and corporate tax rates which is another arguement entirely. And with corporate tax rates, there are a billion ways small business can make their taxable bottom line less than $250k while at the same time increasing their businesses book value.

We have to get real about tax rates and fairness in the system. The wealthiest 2% got a massive tax break for the last 10 years and the middle class got the shaft.....again. We simply cannot afford these tax breaks that add trillions to the deficit.

There are two things that Republicans always will deficit finance. Tax breaks for the wealthy, and unecessary wars.

What we need in order to manage through this recovery is increased demand. Middle Class Tax Breaks are much more effective at stimulating the economy than tax breaks for the wealthy. Why? Because the middle class will SPEND that extra money. We are a consumer driven economy that requires DEMAND. The more people spend on cars, clothes, Starbucks, vacations, etc, the more the economy grows and jobs follow.
The wealthiest Americans just stuff that extra money away. Once you start to earn more than a few hundred grand, you simply stop spending your disposable income at the same % of total income the middle class will. And particularly in this economic climate, you certainly don't see corporations using lower tax rates to create jobs. Companies are HOARDING CASH like no one's business.

Let's learn from the Clinton Administration, an administration that had a budget surplus and created the most jobs ever in a single administration. The more jobs we create, the more our treasury benefits. We don't have a spending problem (with the exception of the behemouth Pentagon Budget) we have a revenue problem. We need thos jobs, jobs, jobs!!

Of the 23 million jobs that were created during the Clinton years - 92% came from the private sector. Subtract public sector jobs created under the Bush years and you have zero private sector job creation and massive tax breaks to the wealthiest 2% with nothing to show for it.

We have real, current evidence about what the two opposing tax policies effect on the economy is. And under the Obama plan, the middle class will have an even lower tax base the the Clinton years, which is well overdue. In the last decade, even as the economy grew - the middle class saw their "real" incomes drop by $2,000 / year, while the rich got richer.

Where is the fairness in the system when billionaire Warren Buffet pays an effective tax rate of 15%, and his secretary has to fork out 33% of her paycheck? It's not fair, it doesn't create jobs and it doesn't help the overall economy or balance the budget. It just let's some other rich asshole by another island filled with coke & hookers.