Pelosi: I am going to raise your taxes
Posted by Clyde Middleton
on Jan 18 2009 Filed under Economy, Politics.
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Subtitled: Understanding the revenue impact of Bush’s tax cuts.
Obama first foreign-policy crisis looks like it is going to be the foreign nature of having people with power equal to his telling how it is going to be.
This town appears to be big enough for two queens: “House Speaker Nancy Pelosi wants Congress to consider repealing President George W. Bush’s tax cuts well before they expire in 2010, in contrast to what President-elect Barack Obama is proposing. / In an interview aired Sunday, Pelosi said, “I don’t want them to wait two years to expire because they have to prove their worth to me.”
Earn their “worth” to you, dear? Get over yourself.
The qualified argument seems to be raising taxes on those making over $250,000 – Pelosi says yes, Bambi says no. It’s a stupid argument, one bereft of an understanding of macroeconomics. Let’s look at the Evil W Tax Cuts.
The main aspects of Bush’s 2001 tax cuts, which are set to expire in 2010 are:
- A reduction of individual income tax rates from 15, 28, 31, 36, and 39.6 percent to 10, 15, 25, 28, 33, and 35 percent;
- An increase in the child tax credit from $500 to $1,000;
- A phased-in reduction in estate taxes, and a one-year repeal in 2010;
- A big expansion of tax-favored retirement savings plans.
Let’s toss some real data in here, since all the libs can do is demonize Bush’s efforts. Who pays personal income taxes? Here’s the year before Bush took office (2000), the first year of his reductions (2001), and the latest available data (2006):
| Year | Income Top 1% | Percent of Fed’l Income Tax Top 1% | Income Bottom 50% | % Tax Bottom 50% |
| 2000 | $313,469 | 37.42% | <$27,682 | 3.91% |
| 2001 | $292,913 | 33.89% | <$28,528 | 3.97% |
| 2006 | $328,049 | 39.89% | <$31,987 | 2.99% |
What do we learn? The income tax burden shifted to those making the most money. Did it do it immediately? No, of course not. He understood that we are moving a multi-trillion dollar economy. You put the structure in place and the economy moves towards it. The top level earned more money in the end result – and paid more income tax as a result.
Dems look for quick, feel-good changes. In the long term, they always fail.
Let’s add to these data the actual dollars paid by these groups (see Table 4 – Billion $$):
| Year | Total Income Tax Paid | Paid by Top 1% | Paid by Bottom 50% |
| 2000 | $981 | $367 | $38 |
| 2001 | $888 | $301 | $35 |
| 2006 | $1,024 | $408 | $31 |
We learn that the bottom 50% received an immediate tax cut in dollars, and that it continued in their favor throughout the term.
What about average tax rates within these groups and for these years? See Table 8:
| Year | Average Tax Rate (% AGI) Total | Average Top 1% | Average Bottom 50% |
| 2000 | 15.26% | 27.45% | 4.60% |
| 2001 | 14.23% | 27.50% | 4.09% |
| 2006 | 12.60% | 22.79% | 3.01% |
Average tax rates decreased and tax revenue increased. The average tax rate of the Top 1% reduced by a tad less than 17%. The rate for the Bottom 50% reduced by over 34%.
Reduced tax rates – increased income. What part of this is so hard to understand?
Related Posts
- Obama to raise income taxes on joint filers making $67,900 or more
- Oh Yes, Your Taxes Are Going Up
- Obama Wants to Raise Our Taxes, Why Doesn’t He Just Raise His Own? [Reader Post]
- Poll: Only 21% Think Obama Will Cut Taxes
- Deeds completes the flameout: Now says he will raise taxes
Short URL: http://libertypundits.net/?p=2806
Democrats, raise taxes, fund socialism and gun control. Up to you to figure out why gun control is so important to Democrats.
dems on gun control: that’s both funny and chilling …
The Constitution was written to give the people mastery of the government; that has now shifted, and gun control is the last nail in the coffin on a free democracy.
Thanks for this post Clyde. Has anybody sent it to Nazi Nancy?