Should the Bush tax cuts be extended?
Posted at 5:00 AM on September 14, 2010
by Eric Ringham
(52 Comments)
Filed under: Economy, Politics/Government
Tax cuts enacted during the Bush administration are set to expire, and leaders in Congress and the White House are debating whether to extend some or all of them. Today's Question: Should the Bush tax cuts be extended?
Comments (52)
Yes, Absolutely!
NAFTA & CAFTA and free trade entirely have drastically increased the amount of income taxes needed from individuals and businesses to balance the budget. With the repeal / loss of most tax revenue streams the burden must fall on us citizens. Once again we can thank our elected officials who were lobbied/bought by business to benefit themselves first!
The richest Americans should be paying their fair share, so tax them.
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Count me also as a proud former Republican. I gladly voted for Reagan and the elder Bush. In those days, taxes really were too high, there really was too much regulation, and it was the Democrats who were doing the simplistic demagoguery. In the Clinton era, we had things just about right, but the younger Bush overshot the goal by a far piece. Now it's the Republicans who are talking nonsense.
They should definitely expire. A progressive tax system, that taxes a little more on earnings past certain points, is the hallmark of a strong country. Even the wealthy are calling for tax hikes on high earners like themselves! The reason? They want to live in a country with a strong middle class.
Why would tax cuts that have done little but cause the deficit and public debt to soar as well as promote the worst recession in 80 years be allowed to continue? Bush reduced taxes, which did little to create jobs and turned a budget surplus into a deficit. Clinton increased taxes, which provided a budget surplus and provided about 30 times as many jobs as Bush. The hollow argument that a tax increase will destroy what recovery there has been is just hype by those who are looking for a free ride. It would make more sense to pass legislation to support small businesses.
Clark, have you actually read anything by Karl Marx? I didn't think so. The core tenet of marxism is the abolition of all private property. It's a much more extreme idea than anything even remotely suggested in anything anyone has written on these pages. What Michael wrote is quite moderate and nowhere near a summary of Marx's thought. To say that it is is a flat-out lie. I don't know if you're deliberately lying or are just repeating someone else's lies that you were gullible enough to believe. In either case, it's clear that you have no regard for the truth.
Michael:
You have just summarized Karl Marx perfectly.
I will be a very happy voter when the far left gets trounced in November and obama is a one termer.
Dear Eric, who used to vote Republican but has since come to his senses:
Welcome!
I remain hopeful that more people will come to their senses and abandon the demonstrably false premise that tax cuts for the wealthy will be good for us all. As you now can see, tax cuts for the wealthy are good only for the wealthy.
A conservative is merely one who conserves that which has been accumulated. Wealthy conservatives want tax breaks for themselves so they can conserve more for themselves.
The Bush tax cuts have left us in the worst economic condition since the Great Depression. Anyone who advocates tax cuts for the wealthy is advocating the same old deal that put us in this terrible situation in the first place.
I recommend we let the tax cuts for the wealthiest Americans expire and use that revenue for direct-hire programs. It's time we had a New Deal.
I believe that we should allow the tax cuts for those couples making over $250,000 and hold them for those making less. If the concern is that they would negatively impact the small business by raising their taxes, the congress should pass the other legislation that Obama is asking for that would give tax cuts specifically to small business and would offer incentives to smaller banks to increase. This would help to offset whatever impact allowing the tax rate to revert would have.
Of course the bush tax cuts should not be extended to the top tax tier. That is is even a question testifies to the shameful incompetence of the American public and media.
Just look at this tax rate over history and it looks obvious that there's no basis for keeping the top rate so low:
20s : 25%
30s : 60s/80%
40s : 80s%
50s : 90%
60s : 70s%
70s : 70%
80s : 50%
90s : 40%
00s : 35%
And now the right wing is raising a stink about the top rate going back to 40%. Cry me a river.
My source for these stats:
http://www.truthandpolitics.org/top-rates.php
They should expire. They were never meant to be permanent. They resulted from the SURPLUS that Bush inherited. Democrats are accused of working for distribution of wealth, but economists verify the distribution taking place has shrunk the middle class and increased the wealth of the richest Americans. These tax cuts will only continue that trend. It is time to allow the middle class to once again grow and thrive. The rich don't need our help.
We cannot lower deficit spending and the debt without raising revenue, and the fairest way of doing that is through the income tax. I favor allowing the Bush tax cuts to expire for those who are not wealthy. Studies have shown that when the wealthy get a tax cut, they don't spend the money and they don't create new jobs, they save the money. (Good for them!)
The cut-off point that Obama has established is too high. Dayton's is more on target: $130,000 taxable income for individuals, and $150,000 for couples.
YES.
The Government acts like it is their money and they know how it should be spent better than I. Well it is not and they certainly do not(i.e. cash for .....).
More income to the government just results in more programs we can not afford.
It would a bad idea to borrow money from the Chinese to pay earners making over 250,000 a year more money. It will be costly to pay for the middle class tax cuts, but I agree it is better to allow average Americans to keep more money. I think the cutoff could be lower - maybe 100,000 would be better.
The really wealthy need no welfare! THEY are not having a bad economy now or for the last , what, 10 years the amount they get back has blossomed. We don't need to increase the money borrowed from other countries to pay the wealthy more money.
Mary Jo
No they shouldn't. The country at large is suffering from a dellusional sense that there need not be sacrifice for the things we feel are important. I am particularly troubled by the Right who want to have open ended spedning for war and all the while cut taxes. It doesn't make sense.
HECK NO!
Nothing good came out of it. Bush started sliding back into the large deficit due to it!
Trickle down has been proven FALSE.
Especially when those at the top are nothing but sponges....
We had the debt in check during Clinton era, and then Bush took over and opened the purse strings to his rich buddies....
http://en.wikipedia.org/wiki/File:US_Federal_Debt_as_Percent_of_GDP_by_President.jpg
Its clear that it is a bad policy.
During the Dark Ages the Nobility did not pay taxes.... Why do I think we will end up with that same economic model?
We all be Surf's/Slaves to the rich if we let that happen.
Raising taxes - at any level - during a recession seems counter-intuitive.
The bigger issue is that, unlike the state government, the federal government is not required to balance the budget. The spending at the expense of future generations shows just how selfish and narcissistic we are as a society.
So, go ahead and raise taxes. But until you cut spending, the bleeding will continue to get worse as we fall further and further behind - and there isn't anyone out there to bailout the source of bailouts.
@Sue de Nim
I agree with you, but I want to clarify something - the theory is that the money which is extracted as profits from one enterprise will be reinvested by the rich as venture capital in other enterprises, thus creating more jobs. The two main problems with this are A) This is largely not true - it is usually either spent on consumption or on unproductive speculation and B) When they do invest, they largely invest by building new factories and enterprises in Asia, where they can create very low wage jobs and get a higher return on their money. Trickle down works to some extent, it just so happens that our tax cuts trickle down to China, not us.
Yes, the tax giveaways to the wealthiest 3% should expire!!!! The other 97% of us can no longer subsidize this privileged group. They have invested the money abroad while buying luxury cars, yachts, watches and jewelry that has done little to fuel the economy. It's time the wealthiest pay their fair share of the tax burden if we all want a decent standard of living. It's time to reinvest in America!
Clark, you said, "We worked very hard and in many cases took huge risks that paid off in high incomes many times sacrificing personal life."
Two things:
1) Many, many poor people bust their butts working at multiple dead-end jobs for crappy pay just to buy their kids medicine. People with money are not the only ones that work hard, so get off your pedistal.
2) It's hard to justify the "huge risks" claim when we can clearly see that there are bailouts that null most risks to iffy investments.
In closing, you are wrong about literally everything you say.
The Bush tax breaks should be allowed to expire as originally planned. The trickle-down approach to our economic woes clearly has failed, and it is time for all of us to pay for the services we receive, according to our ability. Americans need to stop whining about paying taxes and start counting their blessings for the many public programs that benefit us all.
I don't buy the argument that those who are wealthy got there purely through their own hard work. Many of us work very hard, but still never achieve that same level of wealth. No one makes it to the top without help, whether it be from parents, teachers, mentors, or simply the economic system that exists in this country.
The gap between the wealthy and the middle class has grown exponentially and it is time to make a concerted effort to close it before the American Dream becomes a vague memory.
I can't believe I'm actually saying this, but no, they should not be extended in their current form. The reality is we will need to increase revenue in order to get our financial situation under control. I'm all for cutting expenses, too, but that will only take us so far. To those in this country who can afford to pay more it's time to ante up and take more of the burden. This country has made people wealthy and now it's time to give back.
I sa y use the same tax rates we had during the Reagan years (why haven't conservatives promoted this?). With a 12 TRILLION dollar debt and continuous deficits, who in their right mind would want to cut revenues even more?
On the flip side, Americans need to get out of the entitlement mentality. If you want something you have to pay for it. Get rid of everything from farm subsidies to those unlimited payments to people who think the government is their children's daddy.
It always amazes me when I look at Tea Party gatherings, how many retired people are in the crowd, bad-mouthing government spending, but who likely collect (or will collect) more Social Security or Medicare benefits than they have paid for.
Realtive to the industrialized world we still have a realtively low tax rate.
Let them all expire.
Local governments [via lga] could certainly use the extra income to keep from laying off a few teachers and officers.
And for the top 5% or anyone that may have some disposable income these days, federal and municipal bond interest is almost always tax free.
Help the gov pay some bills AND get out of paying taxes...I'm just sayin'.
Taxes are going to go up, and for everybody. The question right now is whether or not it will be in 2011 or later. America overspent for a long time in a lot of ways (for example, the Bush cuts are overwhelmingly deficit funded), and there's no way to correct that without increased taxes.
A 4% hike in the marginal rate for the wealthy won't be fun for them, but it won't be crippiling by any means. And I hardly think that those few percentage points destroy the incentive to produce or "punish success", particularly since the wealthy will still be far wealthier than most Americans after such an increase. A hike in the rate for lower-income people could easily devastate them.
We're all going to see increased taxes in the medium-term no matter what, but the wealthier can afford it now while no one else can.
Clark,
When all else fails, resort to ... whatever it is you did there.
So you're saying that the top 5% should pay 5% of taxes?
Anyone who isn't in the top 5% is lazy, right? Doesn't matter if they work 80 or 90 hours a week earning whatever wage they're paid - if they're not wealthy, they must not have worked hard enough. Is that an accurate description of your position?
Of course they should NOT be extended. I used to vote Republican, then I came to my senses: the party of the wealthy, the party of top 2 or 3%, does not deserve the support of anyone who considers him/herself among the other 97% who are middle or lower income. Also, I'm tired of the constant lies; for example, conservatives calling the expiration of an unjustified tax break a "tax hike." It is simply dishonest.
Only if we decide not to wage two horrendously expensive wars at once. The right-wingers can't have it both ways.
Absolutely not. We were foolish to think that we could fight two wars while cutting taxes and tell people that they could contribute to restoring our post-9/11 economy by going shopping. It's time for some responsibility, and the broken record of endless tax cuts has run its course.
Clark, you seem to be under the mistaken impression that anyone who isn't as much of a radical free-market ideologue as you are is a "far left liberal." That kind of black-and-white, either-or thinking is at the root of what's wrong in with American politics these days. Whichever party shouts loudest and gets the most people angry about the other side wins. The truth is irrelevant. Nuance and thoughtful reasoning are ridiculed. Until we open space in the middle for rational dialog and the truth becomes relevant again, things won't improve.
Bush tax cuts should NOT be extended for those making over $250,000 per year.
Clark does not know what he is talking about. The policies of Barack Obama are NOTHING like those of Fidel Castro.
Compare how much money the wealthy have LEFT OVER after they have paid taxes to that of the other 95%. High income earners will not decide to stop earning just because their taxes go up. I know.
Jamex:
How much income earned by high income eaners is not material. You far left liberals think we won some mythical lottery which is high we became wealthy. Not true. We worked very hard and in many cases took huge risks that paid off in high incomes many times sacrificing personal life. Do you really believe the high income earners of today will take risks if they understand obama and the far left will confiscate rewards? If so, your an idiot
Let the tax cuts expire. Our federal budget is way out of balance with spending dramatically exceding revenue.
The Bush tax cuts for the wealthy were passed during a time of strong economic growth and a large national surplus. This country is no longer in a position to sustain those tax cuts for the wealthiest residents of this nation while the middle class and poor are suffering.
yes, we need to extend the tax cuts and we are living on tighter budgets and more grumpier every day!
oops! didn't mean to go all max headroom on you there....
Clark -
You neglect to mention what percentage of taxable income was was was earned by the top 5% and the top 10%. Can you include those numbers for us?
thx
Well put Clark.
Also since Bush is so BAD why should anything he has done be good?
Let's go back to Carter tax. This time how about we super-size it and see how long the train keeps teetering down the tracks.
PS- Tell Barack I'm already Baroke.
DTOM
If the Bush tax cuts for the top 2% had done what the republican's said it would do and that is create jobs, then why did we lose 8 million jobs after the Bush tax cuts? The tax cuts need to be extended for those that make less than $250,000 per year and no higher.
Is it right that a flight attendant working for United Airlines income went down last year from $44,000 to $43,000 while the CEO made $45 million in the same year. His income went up several million. No more jobs were created, only more wealth for the CEO.
I keep hearing that we need to let the rich keep more of their money, so that they'll grow their businesses and hire more workiers, but something doesn't add up about that. Money that's spent growing a business and hiring workers comes under the heading of "business expenses" and is not taxed. What's taxed is what's taken out as profits and not spent growing the business. It seems to me that if we want businesses to grow and hire more workers, we should actually raise their taxes, so they have to choose between paying the government on the one hand, and hiring workers and making capital investments on the other.
Contrary to Republican assertions, Obama is not "far left," much less a socialist or marxist. Consider what he's actually said and done. He's a slightly left of center moderate, much to the disappointment and consternation of those who really are socialists. Repeating the Big Lie often enough may get people to believe it, but doesn't make it true.
About those Bush tax cuts: if they expire, taxes go back to where they were under Clinton, when they were apparently not bad for the economy. Keep in mind that Bush & his GOP (Greedy Old Plutocrat) allies originally designed those tax cuts to "give back" a surplus. They were not designed, and are ill-suited, to stimulate the economy. Stimulating the economy requires getting money into the hands of people who will spend it, not hoard it-- i.e., the middle class and the poor.
To all the proponents of low taxes as economic stimulus, can you explain to me why we're in the midst of the worst economic recession since the great depression at the same time that are taxes are lower than they've ever been, since the great depression? All the periods of high growth in the modern (i.e. postwar) US economy were under higher tax rates than we have now.
In this case, we could be well served by a gridlocked congress, if they let the cuts expire.
The logical conclusion of the perennial conservative call for lower taxes on the highest earners, lower capital gains taxes, and lower business taxes, is a state in which none of these things exist (and has in fact been proposed outright by some more extreme conservatives). A society where none of these things exist means that those who own the vast majority of the wealth in the state will contribute nothing it its upkeep and will make their profits entirely from rents taken from the work of those working to produce value with the property of the rich. This is called an aristocracy, and as a form of economic organization, history has show it to be a very poor creator of jobs.
Let them expire. All of them. When they first went into effect, my biweekly paycheck changed enough that in a month the difference would have bought me a cup of coffee at Caribou. I don't expect to notice a difference at their expiration.
I keep hearing that "Obamacare" and the money spent on recovery is threatening our future. Let the Bush tax cuts expire and that threat will disappear. Even Republicans like Ben Stern say that he wants to pay his share and thinks his taxes should be increased
If the future is really as dire as I've heard, PLEASE let the tax cuts expire.
When economic times are good, we argue that we should give tax breaks to the rich because we don't want to "punish success," or have "big government take the people's money." When times are bad, we argue that we should give tax cuts to the rich because it will create jobs and prosperity. It seems to me that no matter what the economic forecast, the answer is always to give more tax cuts to the rich. How about we take this to its logical conclusion, and just make it so that the rich pay no taxes whatsoever?
The original Bush tax cuts were gradually increased until 2010. In 2011, they will expire, as they were intended to expire by the Republicans who instituted them. They would never have been passed in the first place if their true and enormous effect on the budget had not been hidden from the public by means of the 2011 expiration date.
By all means let them expire.
Everyone should get the same tax break, which means the tax break applies to the first $250k.
There is no reason that we should borrow money to give the top 2% a tax break.
There needs to be tax fairness.
It would be nice if the 'right wing' individuals be consistent. We need to pay as you go....and to give the top 2% a tax break is borrowing money to give them the tax break, that there is no evidence will help the economy.
Should taxes go up during a recession?
You can't tax yourself into prosperity.
What happens to charitable contributions to colleges, schools, food shelves, hospitals, youth athletic associations, medical research such as Susan J Koemen and American Cancer Society, NPR/MPR/TPT, and places of worship? Would money that went to those causes now get sucked up by the insatiable beast known as government?
We tax things to discourage there consumption, like cigarettes. We increase the tax on smokes, people smoke less. So, increase the tax on work, so people work less?
That's not the way to increase jobs.
But then, the Obama Regime has no interest in the private sector being prosperous.
In 2007, the top 5% of income earners paid 60.63% of all personal income taxes and the top 10% paid 71.22% of all personal income taxes.
The problem with far left democrats like obama is eventually high income earners will no longer have incentive to support the bottom 50% as the democrats continue to confiscate income.
Even Fidel Castro admitted last week socialism does not create incentive to produce.
As a wagon puller all my life, I resent the fat slobs on the bottom rung demanding democrats confiscate more of my income.
Obama's slogan should be "Penalize success and reward failure"
My hope is that on November 3, 2010 I wake up to hear the republicans have trounced the far left democrats and voters have rejected obama socialism.
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