The marginal tax rate for median income earners has been unchanged at 15% since 1987. See http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=226
So what exactly is everyone – especially those in the Tea Party – so upset about, why, and with whom?
Could it be they actually don’t know the facts, or is it that they simply choose to “refudiate” and ignore those facts?
Now, if you’re among the RWMFs the story is admittedly a little different.
As I’m sure all you RWMFs know, the marginal tax rates for the Twice-Median Income Earners climbed from 22% in 1967 to a peak of 43% in 1980. The Dems controlled Congress during this period. The White House was occupied by the LBJ, Nixon, Ford and Carter administrations. The GOP took back the Senate and White House in 1980 and tax rates start declining but primarily for the rich. Hooray.
As any good Randian knows, that means boon times ahead for all of us! Too bad that didn’t work out as planned. The net worth and financial wealth of the top 20% of Americans went from 83.6% and 93.4%, respectively, in 1989 to 85.1% and 93.0% in 2007. (See http://sociology.ucsc.edu/whorulesamerica/power/wealth.html)
So much for trickle down.
Median Income Earners, BTW, saw a much smaller increase in their marginal income tax rates from ’67 to ’80 and very little to no decline after 1980 until………………………….wait for it………………………….the Dems took back the Senate. (See the attached graph of the Tax Policy Center’s data on top of which I’ve laid the parties in power.)
Tax rates declined even more vigorously when the Dems took back the Senate in ’87 and once again controlled both Houses. Let me say that again.
TAX RATES DECLINED EVEN MORE VIGOROUSLY WHEN THE DEMS CONTROLLED CONGRESS.
All you have to do is look at the chart above and the Tax Policy Center’s data and do the math yourself if you don’t trust me.
And what else was happening during the 80’s and 90’s while tax rates were being reduced? Oh, yeah. The federal debt as a percentage of GDP was climbing. (See http://didyoucheckfirst.blogspot.com/2010/02/one-persons-perspective-on-federal-debt.html for a chart of that, again overlaid with political parties in power.)
And why was our debt rising? Could it have been because of increases in defense spending (here and here) while at the same time the taxes being paid into the Treasury were being cut perhaps? No. Couldn’t be. Could it? Really. What do I know, and what do the facts prove? Nothing, right? They are easily “refudiated”.
And who was it who increased taxes on the wealthy Twice-Median Income earners? Was it those evil Dems? No. It was a GOP-controlled Congress who increased those taxes in 1998 from 28% to 33%. Look at the chart and the data. The facts don’t lie. Yes, the Democratically controlled Congress increased them in 2008 – an act for which they win my admiration – but they also reduced them in 2009.
Now remember, while all of this is going on the marginal income tax rates on the middle class remain the same. Let me repeat that.
MARGINAL INCOME TAX RATES ON THE MIDDLE CLASS HAVE BEEN UNCHANGED AT 15% SINCE 1987!!!!
Curiously enough marginal rates on low income earners have bounced around. They are now just a little higher than middle income earners. Evidence, IMHO, that the less money you have the less power you have in this country. You do get to be a political football, though, if you’re poor.
Again, all the data is there if anyone wants to avoid an afternoon of yard work like I have. http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=226
Unfunded tax cuts mean simply this: you can’t reduce taxes without appreciating that those reductions mean less income to the government. Unless you replace it with some other source of funding, the deficit gets bigger. If you cut that income source by cutting taxes but still care about trying to balance the budget, then those cuts must be balanced – funded, if you will – by some combination of increases in income (taxes) elsewhere and/or cuts in expenditures.
For more on this idea, I refer you to the following:
Invincible Ignorance; Paul Krugman
Considering what I think is plenty of proof about our slide into mediocrity and mendacity manifest in so many ways by the Tea Party movement, I guess I’m not all that surprised that so many people are so upset without even understanding why.
Here’s the reality. The GOP is lying, plain and simple, and Tea Partiers seem completely uninformed about the facts.
When the GOP says that Bush’s tax cuts didn’t increase the deficit and were good for the economy and so should be extended and don’t need to be “funded” they are lying. Either that, or they believe there really are free lunches in this world.
The GOP is lying when they accuse Democrats of being the only ones who raise taxes and spend money. When Democrats have controlled Congress, at least since 1987, they clearly have not raised taxes on the middle class. In fact, if anyone bothers to look at the data they will see that it was a Democratically controlled Congress who lowered the marginal income tax rate for high-income earners in 2009 thanks in part, according to the Tax Policy Center, to the Making Work Pay Credit enacted in the American Recovery and Reinvestment Act of 2009.
And the GOP and tea partiers have the balls to whine and cry and stomp their feet about extending unemployment benefits??? Their demand that extending unemployment must be paid for while it’s ok to extend tax breaks to the wealthy without funding is both asinine and heartless.
What I’m saying – again – is that we can’t have it both ways.
If you want to debate facts, let’s do that. If you want to present real data, then I implore you to please do so. If any tea partiers out there can explain and defend their anger with this administration with anything even resembling data and facts, I might actually pay money for that.
Otherwise, I remain steadfast in my conclusions that unless one counts themselves among the wealthiest 5% – maybe 10% – in this country it remains simply and utterly inexplicable to me as to how or why the GOP or Tea Party holds any attraction to anyone but the wealthiest among us…………………unless, of course, you choose to ignore the facts.