This is an interesting tax chart. I guess the myth that Bush's tax cuts were only for the rich is just that, a myth.

With the stagnant wages and horribly increased cost of living under Bush, we needed those tax cuts. And still my standard of living is lower now despite a higher income. You're not looking at the whole picture.

My tax bill is much lower under the Bush tax cuts. No argument there, and my wallet is happier to the tune of several hundred dollars per month (which I then turn around and spend on cigars... )

The problem is that he cut taxes and increased spending at the same time. The economy can support one or the other, but trying to do both is really hurting us, and passing a huge burden of debt to our kids.

It also leaves the next president, whoever that is, with a real mess to clean up.

quote:

Originally posted by CrazyPoet:
The problem is that he cut taxes and increased spending at the same time. The economy can support one or the other, but trying to do both is really hurting us, and passing a huge burden of debt to our kids.

I agree with this to a point. However, this really wasn't the point of my post. I was merely pointing out a fallacy that is repeated by Democrats and the media. Bush cut taxes across the board, NOT just to the wealthiest Americans.

quote:

Originally posted by KKL:
I agree with this to a point. However, this really wasn't the point of my post. I was merely pointing out a fallacy that is repeated by Democrats and the media. Bush cut taxes across the board, NOT just to the wealthiest Americans.

Ah - got it.

You are correct - the Bush Tax Cuts do impact everyone, no argument there.

I think the discussion lies with who is getting the most benefit. It would be interesting to see the chart linked in your original post extended to include higher income levels.

The progressive side says that tax cuts should be targeted at mid-to-lower income households, since they are the most vulnerable and have the most difficulty in meeting basic expenses.

The other side of the argument is that tax cuts at higer income levels pump more money into the economy, with an eventual net benefir to everyone.

I don't know enough economics to know which answer is more "correct". What I know is more anecdotal - myself, and the people I know. As I have more money to spend, the simple fact is that most of it is leaving the country. I'm buying technology that is (mostly) produced overseas, a vehicle that was made overseas (since American manufacturers still haven't figured out what i want) and cigars that are made almost exclusively outside the US.

I am spending more on services, which does impact my local economy.

I suspect (but can't prove) that other people in higher income brackets are doing exactly the same thing.

So here's the rub - manufacturing jobs (historically) pay more than service jobs. Folow the math from there.

It seems to me that tax cuts that impact upper-income brakets tend to put more money into the global economy, but less in the local economies, where it's needed most.

Just my thoughts...

Let's not overlook the fact that Congress, not the President, raises or lowers both taxes and spending. W may have proposed the tax cuts and the budgets, but they were passed by Congress (and not by the Republicans only).

quote:

I was merely pointing out a fallacy that is repeated by Democrats and the media. Bush cut taxes across the board, NOT just to the wealthiest Americans

KKL, how good are you with math?
I looked at the chart and noticed right away that the tax cut at the top of the chart is about $400 and on the bottom is about $4000.
Perhaps $400 is better than nothing, but it's only approx. 1.2% of the $30K income, while $4000 is about 3.1% of 125K income.
HAd the tax been cut equally 3% across the board it would've been $900 for the 30K income -
a summ of money that can be really helpfull to the person with 30K income.

quote:

Originally posted by YaZ:
KKL, how good are you with math?
I looked at the chart and noticed right away that the tax cut at the top of the chart is about $400 and on the bottom is about $4000.
Perhaps $400 is better than nothing, but it's only approx. 1.2% of the $30K income, while $4000 is about 3.1% of 125K income.
HAd the tax been cut equally 3% across the board it would've been $900 for the 30K income -
a summ of money that can be really helpfull to the person with 30K income.

Well, now we you are getting into the fairness of the tax system all together. I would be fine with a 3% cut across the board if you would be okay with each tax bracket paying tax on the same percentage of their income regardless of how much they make.

For instance, if my math is correct, a single person making 30K is paying tax at a rate of about 9% of their income. A person making 75K is paying tax at a rate of about 17% of their income. Is that fair?

This message has been edited. Last edited by: KKL,

quote:

The economy can support one or the other, but trying to do both is really hurting us, and passing a huge burden of debt to our kids.

About damn time my kids do something.
Honestly I know way too many kids (young 20s) that think that they should be able to get by with working 20 to 30 hour weeks and live just fine that way. Something about this generation has gotten their minds just out of wack. Then again I joined the military within a couple weeks of my 18th birthday and have been working 40+ hour weeks every since, even after I retired from them.

quote:

Originally posted by YaZ:
KKL, how good are you with math?

The more appropriate question would be to ask you about your math skills.

To use your terminology: The people at the top are paying less than 10% of their income while the people at bottom are paying double that percentage.

In other words, the difference for people at the low end are saving 15% on their taxes while the people in the high end save about 11%. Still seem unfair?

quote:

Originally posted by KKL:

quote:

Originally posted by YaZ:
KKL, how good are you with math?
I looked at the chart and noticed right away that the tax cut at the top of the chart is about $400 and on the bottom is about $4000.
Perhaps $400 is better than nothing, but it's only approx. 1.2% of the $30K income, while $4000 is about 3.1% of 125K income.
HAd the tax been cut equally 3% across the board it would've been $900 for the 30K income -
a summ of money that can be really helpfull to the person with 30K income.

Well, now we you are getting into the fairness of the tax system all together. I would be fine with a 3% cut across the board if you would be okay with each tax bracket paying tax on the same percentage of their income regardless of how much they make.

For instance, if my math is correct, a single person making 30K is paying tax at a rate of about 9% of their income. A person making 75K is paying tax at a rate of about 17% of their income. Is that fair?

In my opinion it is, and this is why:
I'm now (knok on wood) is on the bottom of that chart (knok on wood again). I pay now more in taxes than I used to earn. But when you deduct the basic cost of living - like cost of food for 2 people (in my case it's 4+ ), cost of rent or mortgage (assuming you live in a place compatable with your income level) + utilities and the cost of buying gas for the car, you still have a lot more money left even after paying higher taxes.

Another thing to point out: while you may have more money in your pocket thanks to lower taxes, the Fed under Bush has overseen a period of devastating inflation that effectively confiscates more of your wealth every year without you even noticing it.

Here's a great idea. Make a flat tax rate for all. We seem to have so many people who feel that they just don't pay enough in taxes that when they pay more (since that will be optional) we will all be fine.

Oh wait, they only want someone else to pay more not themselves. I keep forgetting that.

quote:

Originally posted by YaZ:
In my opinion it is, and this is why:
I'm now (knok on wood) is on the bottom of that chart (knok on wood again). I pay now more in taxes than I used to earn. But when you deduct the basic cost of living - like cost of food for 2 people (in my case it's 4+ ), cost of rent or mortgage (assuming you live in a place compatable with your income level) + utilities and the cost of buying gas for the car, you still have a lot more money left even after paying higher taxes.

If you are making $30K and have 4+ dependents, I would have to believe you are paying next to nothing in income taxes.

"Another thing to point out: while you may have more money in your pocket thanks to lower taxes, the Fed under Bush has overseen a period of devastating inflation that effectively confiscates more of your wealth every year without you even noticing it."
______________________________________________

Nonsense. The annual inflation rate ove rthe last 8 years has never exceeded 3.4%

http://www.inflationdata.com/inflation/inflation_rate/HistoricalInflation.aspx

Now these were some really bad years for inflation:

http://inflationdata.com/inflation/Inflation_Rate/Histo...lation_currentPage=2

quote:

Originally posted by brewerc:
Here's a great idea. Make a flat tax rate for all. We seem to have so many people who feel that they just don't pay enough in taxes that when they pay more (since that will be optional) we will all be fine.

Oh wait, they only want someone else to pay more not themselves. I keep forgetting that.

I have no problems with a flat tax - it makes a lot of sense.

Nixdad,

You are correct and I was mistaken. I was referring generally to an increase in the money supply and the the general global devaluation of the dollar. (Which has the effect of confiscating our wealth.) While this has a number of causes, one of the major ones is the profligate printing of money by our government. This is a contributor to inflation but not the only one.

As a side note, it's interesting - and a little sad - that when you subtract the inflation from the interest rate, we are left with an effectively negative rate of return on savings.

Scott,


I agree that our gov't spends way too much money but I wonder whether it is actually "wasted". After all, it gets spent on something (even $400 toilet seats) so the money stays in the economy. I think the real problem is that the gov't effectively takes money away from those who earned it and literally spends the money for them. The result is a distortion of spending from what the earners would have spent it on to what the govt spends it on. We also need to realize that while everybody thinks the govt spends too much, a lot of people think it doesn't spend enough on their favorite projects.

Also true. My particular beef is the actual amount of money the government prints each year which is not objectively tied to, say, gold or anything of rational value. Rather, it's done capriciously to achieve short term and political goals - decreasing the value of the dollar to make our exports more attractive to consumers overseas, etc.

We are now all starting to feel the most egregious type of tax possible - inflation. If the trend continues (meaning, inflation escalating), the only way to handle that is to increase interest rates or actually reduce spending.

The current Bush administration is certainly not the first one to spend far in excess of revenues. Yet this is the first time in US history that we have had any tax decreases for any class while we are in a war.

And specific to the topic of this posting, yes it is true that the Bush administration tax cut affected much more than just the very rich. And, as posted above, the real problem is that a tax cut was not appropriate given the chosen policy to keep increasing war as well as other spending.