Proof that tax cuts work? It’s only for the little people.
“We don’t pay taxes. Only the little people pay taxes.” — Leona Helmsley
This from the November 27 New York Times:
WASHINGTON — The No. 2 Senate Republican, Sen. Jon Kyl (R-Arizona), expressed concern on Sunday about President Obama’s proposal to continue a reduction in the Social Security payroll tax and questioned whether the tax cut had fostered the creation of jobs, as Democrats say.
* * *
It’s a good question, but the problem is that it’s one that Sen. Kyle never seems to want to ask when it comes to the Bush Tax Cuts. Those are the tax cuts that we already know haven’t worked and their most significant positive impact is on a relatively small number of very wealthy recipients of the largesse.
“The best way to hurt economic growth is to impose more taxes on the people who do the hiring,” Mr. Kyl said. “As a result, the Republicans have said, ‘Don’t raise the existing tax rates on those who do the hiring.’
Just what hiring are you talking about, Senator? Is anybody else sick of hearing this fairy tale — that further fattening fatcats somehow creates a better condition for everyone else? (And let’s not forget that hiring people is, well, tax deductible.) But perhaps it was just something else that Sen. Kyle said which was “not intended to be a factual statement.”*
Since 2001, the Bush tax cuts have cost more than a trillion dollars. You can look at the running total right here:
Note that of that total, more than $700 billion went to the top one percent. The bullpucky that the Republicans continue to promote and defend is that this is doing some kind of great good for the economy. The problem is that we know it doesn’t and moreover, it has a tremendous negative impact on the deficit and the debt — (two things that the GOP keeps tell us are really important to them.)
Check out this New York Times graphic (just click for a clean look):
A recent Congressional Budget Office study found that incomes of the top 1 percent of the U.S. population (adjusted for inflation) rose 275 percent from 1979 to 2007, while income for the middle class grew only 40 percent. “Even this dismal figure overstates the fortunes of typical Americans,” says Lawrence Summers, who served as Treasury Secretary in the Clinton Administration. “In 1965, only one in 20 men ages 25 to 54 was not working; by the end of this decade, it is likely to be one in six, even if a full cyclical recovery is achieved.”
I have to tell you that I’m not necessarily in favor of extending the Social Security payroll tax cut, either, if it is not producing. But it is interesting to note that at about $110 billion a year, the cost matches up pretty well with the Bush tax cuts. Given the choice, the Social Security payroll tax cut provides a whole lot more economic justice because it touches every wage earner in the country. If pouring $110 billion directly into the economy through tens of millions of people instead of stuffing it into hedge funds by a tiny fraction of the number doesn’t create jobs, then perhaps Sen. Kyl would like to provide a head-to-head comparison. Let’s see which is the more efficient way to cut taxes when it comes to economic stimulus. And if it’s a wash, then I would think that we should go with the approach that most positively impacts the greatest number of people.
It’s time to stop playing 3-Card Monte with the GOP on tax cuts and job creation. We don’t have to keep pretending that we don’t know what doesn’t work and what contributes to our deficit and the debt. Dump the Bush tax cuts. And if I have to give back a grand to get the banksters billions into the game, then I’ll be happy to do that.
*Caught telling a blatant lie on the Senate floor about Planned Parenthood, Sen. Kyl coined one of the more memorable quotes in the annals of political spin:
Nov. 30 — House GOP Leadership warns members on tax votes: