Tuesday, September 21, 2010

Renaming the Bush tax cuts

Since the tax cuts were enacted in the early days of George Bush’s first term in office, Democrats have called them “Bush tax cuts for the rich.” The term has been parroted by the so-called “mainstream media” so often that there doesn’t seem to any alternative title to what was actually The Economic Growth and Tax Relief Reconciliation Act of 2001 or EGTRRA for short. I remember getting a check from the government when this bill became law. I was working for an hourly wage and couldn’t be classified as rich under any recognized method. At the time, many of us were suffering from the recession that was caused by the bust of the “dot-com bubble.” My 401K took at big hit and a lot of my friends who had planned on retiring decided to continue working as long as they still had jobs. Maybe you remember those times as well.

In order to get this bill through congress, the Republicans had to agree that the tax rates would revert to their previous rates at the end of 2010 unless congress extended them. Now that that deadline is looming, the question of the day is “Will Obama allow the rates to be extended, or will he insist on socking it to the taxpayer in the middle of what has become his recession.” The division, predictably, goes right down party lines: Democrats, Obama supporters and those who don’t pay any federal income taxes want taxes to go up—that’ll bring in more money for welfare, while Republicans and others who earn a living want them extended. Republicans pointed out early in the argument that it would be stupid, if not disastrous, to raise taxes during a recession.

Lately, the Democrats have changed their strategy. Now some of them are saying that they are for keeping some of the tax cuts—those for the middle class, but not for those earning more than $250,000. That amount seems like a fortune to those who work for some company or corporation, excluding top management. But the owners of plenty of small unincorporated businesses are included under the classification that leaves them liable for a big tax bite if the Bush tax cuts are not extended. These are the very same people that hire others and will be responsible for bringing the country out of its present economic woes. The president appears to be deaf to his critics and says he’s not going to grant any relief to those making over $250,000 per year no matter whether they are individuals or small business owners. His line now is that the government cannot “afford” to spend the amount of money required to “give” the rich a big tax cut. One might get the idea that he believes that all the money belongs to him and that allowing people to keep some of their own money is somehow a gift from the government to wealthy individuals.

I heard the Speaker of the House, Nancy Pelosi, say the other day that Obama’s current plan, if it doesn’t change between now and whenever he acts on it, will now be known as the “Obama tax cuts for the middle class.” But don’t expect to see any actual new tax cut. The actual tax cut happened back during the Bush administration in 2001 and 2003. The new “Obama tax cut for the middle class” will be like most of the good things his benevolent leadership has given us—mostly imaginary.

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