The Trunk

Being Fair About (Talking About) Taxes

The Great Predicament Facing Obama

The sequence of events is not debatable: 1) In 2001 Republicans inherited Clinton’s hard-earned “balanced budget.” 2) They immediately moved to dismantle it by generating a trillion-dollar tax cut for the rich. No more balance in the budget… .

This kind of mischaracterization does nothing to advance the debate.

If the Bush tax cuts were permanent, it would cost the country $3.7 trillion over the next ten years. ”Of that, $3 trillion accounts for the cost of extending them for the vast majority of Americans, as the president has proposed. The remaining $700 billion is the cost of extending them permanently for the high-income earners.”

So what does this mean? It means that the vast majority of the Bush tax cut went to average Americans. Obama’s proposed continuation of these tax cuts would cost us $3 trillion dollars.

None of this tells us what the country should do as a matter of policy. But It is not fair to say that the deficit exploded because of tax cuts for the rich … it exploded because spending exploded at the same time taxes went down for everyone. And soaking the rich barely makes a dent in that.

Source: azspot