Nov15
Tax Increases Versus Spending Cuts
on November 15, 2012 at 11:04 amWhich hurt the economy more?
The answer is inconvenient to the leftist narrative. Because they aren’t about helping the economy, or even helping real people. It’s more about who they hurt than who they help, because they’re about “social justice.”
One of the things about repealing the Bush tax cuts (which were extended by Obama) was that they didn’t just impact the top rates, they reduced all rates. The lowest tax rate used to be 15% and the Bush cuts reduced it to 10%. All of the marginal rate brackets were reduced and so was the marriage penalty.
Now, when Obama talks about repealing the tax cuts on “the rich” (>$250K), does that only mean the top rates or does that mean all of the rates get adjusted and marriage penalty restored? Here’s a handy reference for the different rates and brackets from 2000-2012.
If it’s the latter, then the tax increase for earning $250,001 adjusted gross income would be rather substancial compared to $249,000. People would do whatever they could to avoid going over that theshold just like some people will do whatever they can to keep their income below the limit for certain welfare benefits like food stamps.
Using the above reference, if someone had to pay the year 2000 rates on $250,001 adjusted gross income and married filing jointly, their total federal income tax bill would be $73,048.86. Using the 2012 tax brackets, their federal income taxes would be $60,066.83, a difference of about $13,000. Don’t forget that state income tax rates are tied to the federal rates, so those taxes would go up as well. The marginal cost of exceeding the $250K threshold would be very high indeed.
Any report is going to be biases by its assumptions.
The huge difference between tax and spending is tax is generally widespread where spending is generally focused. This is why spending distorts markets and is a really bad thing if you want to understand overall dynamics.
Taxes can and will be avoided (to whatever extent they can be.)
I’m much more concerned about spending than taxation.
Taxing income is a really dumb idea.
You wing nuts just don’t get it, do you? As a newly-minted Leftist Democrat, I support my President’s statement that even though increasing taxes on millionaires and billionaires (anyone making more than $250 k) won’t raise revenue and may hurt the economy, it is necessary as a matter of fairness. Come on, Jim, Bob-1, Chris, Thomas…back me up here, comrades!
I’m a little nut so brown; Sitting on the old, cold ground.
People come and step on me; That is why I’m cracked, you see.
I’m a nut. I’m a nut. I’m a N. U. T. wing nut!
I didn’t know democrats came in mint?
Writing about “liberalism” as representing “a vision of the annointed,” Thomas Sowell frequently points out that “the annointed” (those who feel they have been somehow given the right to use the coercive powers of the State to force their preferences on the rest of us) frequently don’t have a clue about the negative impact of their policies, or if they do, don’t care. It’s all about being “annointed” rather than helpful.
Criticism of honorable exalted African-American president’s enlightened tax policies be raciss.