And the rich get richer
November 10, 2010
Republicans in Congress have informed the president that if he wants to get anything done, he should kiss their derrieres. (Using the polite form here for the family readership.) In regards to the extension of the Bush tax cuts, Obama has gallantly accepted their kind offer.
Some of your readers may not have informed themselves on this arcane subject. In short, the Bush tax cuts date to 2003. They reduced the top bracket tax rate from 38.6 percent to 35 percent. The top bracket then started around $300,000 of adjusted income. That means those individuals, who earn more than $300,000, after all of their dozens of credits and exemptions and deductions (and Swiss bank accounts), got an additional tax break of about 9 percent less than they were already paying. But remember, this only applies to income over $300,000.
Only a little over 1 percent of American taxpayers earn over $300k,000 How’s it working out for them?
On the first 100 grand over 300, the tax saving is about $3,600 per year. Will they even notice? Will they run out and hire a new employee with that $3,600? Doubt it.
But how about the guy making, say $1.3 million a year; he saves $36,000. Thirty-six thousand dollars is the annual salary of one $18 per hour employee, or two $9 per hour employees. Will this guy run out and hire people? Doubt it.
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Now look at the handful of billionaire babies. Their tax savings per billion are $36 million per year. Now we are talking about some real money. And now we are talking about the people who have just bought your new United States Congress. The people they hire work in Washington. Much better return on investment.
Here’s the kicker: For the 46 years from 1936 to 1981, the top tax bracket averaged 81 percent!
Big money doesn’t think they should pay any tax. Many don’t. So they hire politicians and judges to make it as little as possible. Thing is, they can afford it.