Wednesday, April 05, 2006
The Bush Tax Cuts - Generosity of the 500 Lb. Gorilla
Who Are the Beneficiaries? * Iraq - The President Talks but does not fund
A clear picture is emerging of the effects of the much-vaunted tax cuts championed by the president and passed by Congress in 2003. It is not a "water under the bridge" issue. We are paying for the tax cuts and we'll continue to pay for them. David Cay Johnston writes in The NY Times: "The first data to document the effect of President Bush's tax cuts for investment income show that they have significantly lowered the tax burden on the richest Americans, reducing taxes on incomes of more than $10 million by an average of about $500,000."
A clear picture is emerging of the effects of the much-vaunted tax cuts championed by the president and passed by Congress in 2003. It is not a "water under the bridge" issue. We are paying for the tax cuts and we'll continue to pay for them. David Cay Johnston writes in The NY Times: "The first data to document the effect of President Bush's tax cuts for investment income show that they have significantly lowered the tax burden on the richest Americans, reducing taxes on incomes of more than $10 million by an average of about $500,000."
To be fair, the president and his party made no secret of their objective. The numbers were there for all to see. They are,however,masters of the game. Smoke and mirrors succeeded in hiding the ugly truth. A few who raised red flags were not heard in the din. With Republicans in control of Congress, the tax bill was passed. The President continues to push to remove the sunset clause and make the cuts permanent. What has changed is that the president is no longer the 500 lb. gorilla he was back in 2003.
Excerpts from NY Times:
"When Congress cut investment taxes three years ago, it was clear that the highest-income Americans would gain the most, because they had the most money in investments. But the size of the cuts and what share goes to each income group have not been known.
As Congress debates whether to make the Bush tax cuts permanent, The Times analyzed I.R.S. figures for 2003, the latest year available and the first that reflected the tax cuts for income from dividends and from the sale of stock and other assets, known as capital gains.
The analysis found the following:
The analysis found the following:
- Among taxpayers with incomes greater than $10 million, the amount by which their investment tax bill was reduced averaged about $500,000 in 2003, and total tax savings, which included the two Bush tax cuts on compensation, nearly doubled, to slightly more than $1 million.
- These taxpayers, whose average income was $26 million, paid about the same share of their income in income taxes as those making $200,000 to $500,000 because of the lowered rates on investment income.
- Americans with annual incomes of $1 million or more, about one-tenth of 1 percent all taxpayers, reaped 43 percent of all the savings on investment taxes in 2003. The savings for these taxpayers averaged about $41,400 each. By comparison, these same Americans received less than 10 percent of the savings from the other Bush tax cuts, which applied primarily to wages, though that share is expected to grow in coming years.
- The savings from the investment tax cuts are expected to be larger in subsequent years because of gains in the stock market.
Funding for Iraq Not A Priority
The glaring difference between what the president says and the facts about Iraq again brought to light in Peter Baker's report in the Post:"The commitment to what the president of the United States will say every single day of the week is his number one priority in Iraq, when it's translated into action, looks very tiny," said Les Campbell, who runs programs in the Middle East for the National Democratic Institute for International Affairs, known as NDI."
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Note: NY Times articles can be accessed free of charge only for 7 days after publication.
