Read My Lips: Raise My Taxes!

A report by the Congressional Research Service leaves little doubt. The income gap has grown enormously!
by Charlie Leck

Preamble!
Is it important that I state up front that I am not in the middle or lower income tax brackets. In a fair world, I should be paying more taxes. This statement is only a preamble to the subject of today’s blog about the dramatic growth of the separation between the wealthy and not-wealthy in this nation. I only think your understanding of my standing makes the following statement more credible.

A report has just been released by the (nonpartisan) Congressional Research Service that seems to explain the reasons for the growing divide in economic status in America. For a full explanation of the report I recommend this story in Monday’s edition of the Washington Post. If you really want to read the report itself, you can find it here.

What you’ll find is that Warren Buffet has been right-on in what he’s been telling us about the income tax rate for years; essentially that “the share of total after-tax income attributable to dividends and capital gains grew by 40 percent, faster than any other category.” Those in our society who receive such income pay a much smaller rate on it than the fellow who files his w2 forms on his earned income at the end of the year.

George W. Bush’s income tax cuts for the wealthy made an enormous difference in this country and are primarily responsible for this huge and widening gap. “…the Bush tax cuts of 2003 blew it wide open by slicing the top rate on dividends and long-term capital gains from 28 percent to 15 percent.” (Don't get me wrong, a Congress controlled by Democrats had to approve the Bush tax cuts!)

And, the impactful recession we’ve just gone through has made matters even worse by deadening the ability of middle class income to grow.

“Not only does this foster inequality, it also creates an incentive to seek investment income rather than the ordinary kind…”

The report argues convincingly that this income of the wealthy has already been taxed at the corporate level to the tune of approximately 35 percent. While a hike in the amount of taxes the wealthy pay on dividend and capital gains taxes seems appropriate, a lowering of the corporate tax rate might also make sense.

One has to decide whether this growing and enormous gap between the haves and the have-nots in this country is creating an unhealthy society. To me, there doesn’t seem to be much to argue about.

Our federal tax system must be reformed in a manner that will enable a strengthening of the middle class.

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The Payroll Tax Cut

There is a strange argument going on in Washington about the renewal of the payroll tax cut for the middle class!

by Charlie Leck

There’s a strange debate (or argument) going on among Republicans and Democrats in Washington right now – very, very strange indeed! It’s the veriest!


Here’s how it shakes out. The Republicans will want to extend tax cuts for the wealthy when the time comes around in a couple of months BECAUSE it will be good for the economy – just as they extended those cuts a few months ago. The wealthy will invest in the American economy, they say, and that creates job and economic activity. However, the Republicans do NOT want to extend payroll tax cuts for the middle class BECAUSE that will not be good for the economy since it will just drive up deficits.

Shake your finger at them, Mr. President. Shame, shame, shame! Shame on you!

Make sure the American public knows just which side the Republican Party is on! Don’t let them off the political hook on this one.

John Boehner
The House Speaker, Mr. Boehner, is showing his stripes in this debate and he’s proving to the public that he is not a real leader in the House. A few days ago he was all in favor of extending these middle class cuts. Now, as he sees and feels the temperament and desires of House Republicans, he is reversing field and trying to defend himself. The new, freshman Tea Party representatives have put the squeeze on Boehner and he is acquiescing to their desires
.

If the Republicans really fail to extend these cuts they will be damaging their chances in the 2012 elections to a degree that is really unimaginable. The power of the vote is the one great advantage that the poor and the middle class have in this nation. If they feel that power, and flex that muscle, the Republican Party will be devastated next November.

This country is being done great damage by a handful of Tea Party representatives and Boehner should not be letting them get away with it; however, the Speaker is a hollow shell and cannot do what needs to be done – that is, lead!

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If you read my blog regularly, why not become a follower? All you have to do is click in the upper right hand corner and establish a simple means of communication. Then you'll be informed every time a new blog is posted here. If all that's confusing, here's Google's explanation of how to do it! If you don’t want to post comments on the blog, but would like to communicate with me about it, send me an email if you’d like.