Let Them Eat Cake

Many of the same lawmakers that We The People hear daily yammering on and on about how expensive the proposed health care reform will be ($1 trillion over 10 years is the CBO estimate being bandied about) are the very same ones who enthusiastically supported Bush II's tax cuts. The organization Citizens For Tax Justice (a watchdog group active since 1979) published an interesting white paper (PDF) assessing the annual and cumulative costs of those tax cuts.

The total of the cuts for all recipients is $2.106 trillion over 10 years. Since those cuts occurred while we were engaged in two wars that were never included in the budget, the cuts were financed by deficits. You may recall Vice President Dick Cheney's infamous quote that "deficits don't matter." It turns out, they do matter. When you add in the debt servicing - interest - those Bush tax cuts amount to $2.485 trillion. In other words, the deficit funded tax cuts cost We The People nearly two-and-a-half times what the proposed health care reform would cost.

We can afford tax cuts for the richest 20% of the employed but we cannot afford health care assistance for the bottom 50%. Are you liking how that feels?

Let's go back to those tax cuts and see just who got the most benefit from them. Those who support them would like you to believe that everyone benefited. And that is true, as far as it goes. But who got what? Let's follow the money.

Out of that 2.106 billion dollars, those in the top 1 percent of earners (the fat cats at the top earning $1.4 million or more per year) got $674 billion, or 32 percent of the pie, basically a third. The next 4 percent (those earning $249k or more) got $305 billion, roughly 15 percent. So the top 5 percent of wage earners received just shy of 50% of the total benefit of those tax cuts. The next 15 percent of wage earners (those earning $114k or more) got $506 billion, or 24 percent of the total. That means that the wealthiest 20 percent received over 70 percent of the tax cut benefit that was funded by deficit spending.

We The People gave the wealthiest Americans a tax break - money in their pockets - and put it on our American Credit Card.

[pause while that sinks in]

Meanwhile the remaining 80 percent of Us (those earning less than $114k) divvied up $622 billion in "benefit" (the unfunded spending spree with a bill coming due from China), or roughly the remaining 30 percent of the pie.

For those of you who are tax savvy, you might be thinking that those tax cuts sound great, but that great big bill did not adjust the Alternative Minimum Tax (sort of a backstop designed to make sure that everyone pays at least some income tax). That's true, the original bill did not. However each year Bush and Congress adjusted the AMT downward so that those at the top got more benefit from those tax cuts.

I'm all for tax cuts when they are paid for. What Bush did was utter madness.