Like other bloggers of my kind, I spend a lot of time following issues I’ve seized on, while also dipping into others that look like my cup of tea.
I also try to exercise a certain amount of discipline about how much I pack into a post. So draft paragraphs fall on the cutting floor. And sometimes a new angle occurs to me after I’ve said, “enough already.”
All this certainly gives my mind a workout. But it’s also frustrating in a couple of ways.
On the one hand, I find new research on things I’ve already written about — not enough for a whole post, but meaty and relevant enough so I wish I’d found it before.
On the other hand, I identify issues that spark my interest. But I know I’ll have to spend considerable time learning about them before I’ll feel comfortable framing a post.
So I’m going to try an experiment — occasional posts that are more or less a scrapbook of supplements to posts I’ve written and first cuts into topics that are in my mental file.
Not a massive data dump. Just a selection of fragments of squirreled away, plus an occasional instance of what the French call l’esprit d’escalier (the smart thing you think of as you’re walking back down the stairs.)
This is the first of such posts. I hope you’ll let me know whether you’d like more.
Bush Tax Cuts: GOP v. Obama
Congressional Republicans and the President agree that the Bush tax cuts for households with incomes at or below $250,000 should be extended. As you undoubtedly know, the Republicans want the tax cuts for high-income families extended too.
Among these is the current version of the estate tax — a whopping $10 million exemption for couples, plus lower rates on the rest. The President wants to extend it, but exempt a mere $7 million.
Don’t think Republicans are all for lower taxes, however. Unlike the President, they don’t want to extend the expanded versions of the Earned Income Tax Credit and Child Tax Credit that were originally part of the Recovery Act. Both of these benefit low and moderate-income working families.
A new brief from Citizens for Tax Justice shows the contrasting results. Needless to say, very high-earners would do far better under the Republican approach. All but the top 5% would do worse.
Disparities increase as you move down the income scale. The bottom fifth would pay $150 more next year if the Republicans have their way.
CTJ provides similar state-level breakdowns for average tax cuts residents would receive.
Here in the District of Columbia, the bottom fifth would pay $120 more under the Republican approach. Only the top 20% would do better.
The top 1% would do a whole lot better — tax breaks totaling an average of $116,850 more than under the President’s plan.
Another Thought on the Millionaire Threshold
As those who follow this blog know, I’m not on board with making most of the Bush tax cuts permanent, as both Congressional Republicans and the President have said they want to.
Presidential hopeful Mitt Romney as well, of course, but with some extra sweeteners for high-earners and some bitter pills for low-wage workers who are barely getting by.
Raising the “middle class” threshold to $1 million, as House Minority Leader Nancy Pelosi proposed, would make things worse. I’ve already given some of the reasons I think so. Here’s another — not tactical like Pelosi’s recent retreat.
The millionaire threshold reinforces the notion that only the wealthy should have to pay higher taxes than they do now. To borrow from former Senator Russell Long, “Don’t tax you. Don’t tax me. Tax the rich fellow behind the tree.”
Yet in the long run we’ll need more tax revenues — both to curb our rising debt and, as the Center for Economic and Policy Research notes, to invest more in areas crucial for economic growth, e.g., education, infrastructure, research and development.
We can’t look only to millionaires and to large corporations — another favorite villain these days. As Adam Davidson at NPR Planet Money has argued, the middle class will have to pay more too.
Some People’s Entitlements Are Better Than Others
Hardly a day goes by without some public pronouncement about costly entitlements. I’ve yet to see calls for curbs on the food stamp program, Social Security and/or Medicare also mention farm subsidies.
Yet they’re entitlements too. Mainly benefits to large farm businesses — and people who own farm land but don’t grow anything on it.
Both the Senate’s new Farm bill and the House Agriculture Committee’s version would eliminate automatic cash payments to farmers (and non-farmers). But they would expand insurance against lower profits.
Farmers who grow certain commodities, e.g., corn, wheat, would be guaranteed 85-90% of their previous five-year returns — unless, in the House version, they’d rather get another layer of protection against steep, multi-year declines.
What other type of business gets taxpayer-funded underwriting against market price drops? What makes this affordable, but not funding to preserve food stamp benefits for low-income people who depend on them now?