Paltry cuts for the Middle Class, huge cuts for the Wealthy
That’s the Republican Plan – Wealthy 1%
What are they thinking? They believe that the 1% can finance and swindle their way into power. Then what?
They have already damaged the Middle Class to the point we can no longer afford to support their greed.
Give them old time Democrats, that’s good enough for me. (musical note)
“There are two very different tax-policy conversations playing out in the Republican Party right now. In Washington, House Republicans are arguing with each other over how small of a temporary tax cut to give the middle class. Out on the primary trail, the Republican presidential candidates are arguing over how huge of a permanent tax cut to give the wealthy.
The Washington conversation is over the extension of the payroll tax cut. Some House Republicans say it should be allowed to expire altogether. Some think, either for economic or political reasons, it should be extended for another year. Not one Republican, to my knowledge, agrees with the Obama's administration's proposal to pass a larger payroll tax cut for 2012. Rather, the center of gravity in the party is between a plain extension of the current rates and no tax cut at all, and Speaker John Boehner is trying to win Republican support for the extension by turning it into leverage for a wholly unrelated priority: the Keystone XL oil sands pipeline.
Washington Republicans say their reticence to pass a larger payroll tax cut is explained by the deficit. But out on the campaign trail, the Republican candidates seem unburdened by any similar concerns. The Tax Policy Center has, at this point, assessed the tax plans of Herman Cain (remember, his campaign is merely "suspended"), Rick Perry and Newt Gingrich. Compared to the current tax rates -- that is to say, compared to a world in which the Bush tax cuts never expire -- Cain's plan would mean a $238,000 tax break, on average, for taxpayers in the top one percent. Perry's plan would give that same group a $281,000 tax break. Gingrich's plan would give them a $340,000 tax break.
As for the middle class, Cain's plan would raise taxes on the middle quintile of the income distribution by $4,300 on average. Perry's plan -- assuming the middle class opted into it -- would raise their taxes by $339. Only Gingrich gives them a tax break, and compared to what the rich get, it's a small one: $1,100. None of these plans are paid for.
The Tax Policy Center hasn't assessed Jon Huntsman's plan in detail, but a quick look suggests it would also amount to a large tax cut for the wealthy: Huntsman takes the Simpson-Bowles commission's most radical plan for flattening the tax code but, rather than using the savings for deficit reduction, uses them to wipe out taxes on capital gains and dividend income. So it raises taxes on most Americans and then cuts them for the wealthy. It's a more balanced plan than what Perry or Gingrich have put out, but it envisions a much more regressive tax code than the one we have now.
The only major Republican candidate who hasn't proposed a massive tax cut for the wealthy is Mitt Romney. His plan mostly just extends the Bush tax cuts, wipes out the estate tax, and makes some vague noises about tax reform. He does propose a new tax cut on income from capital gains and dividends -- but only for taxpayers making less than $200,000.
In other words, Romney, who began the primary by looking toward the general, has an unexciting tax plan that, insofar as it does anything, cuts a few taxes for the middle class. The other Republican candidates, who have plans aimed at winning the primary, have proposed plans that massively cut taxes on the rich and, in most cases, raise them on the middle class. And in Washington, congressional Republicans are fighting Democratic efforts to raise taxes on the rich in order to finance a larger middle-class tax cut.
All of which leaves the Republican Party in an odd place: skeptical of a temporary tax cut for the middle class that carries a price tag in the low hundreds of billions of dollars and is fully paid for but apparently enthused over permanent tax cuts for the rich that cost trillions of dollars and aren't paid for at all. That can't poll well.”
Via Ezra Klein, Washington Post
Most Recommended Comment
New Port Richey, Florida, United States