Tax Cuts for the Rich

One of the things that all three Democrat candidates agree on is their opposition to tax cuts for the rich.

The Bush tax cuts were simply hand outs to the rich, and the middle class is paying for it.

Well....

[N]ew IRS statistics on the taxes Americans pay show that George Bush's tax policies actually soak the rich.

It turns out that the income tax burden has substantially shifted onto the wealthy. The percentage of federal income taxes paid by those who make more than $200,000 a year has actually risen from 41% to 47% in recent years.

In other words, the richest 3 out of 100 Americans are now paying close to the same amount in income taxes as the other 97% of workers combined.

But what about those in the middle?

It's also a common myth that the rich are hording all the wealth, while the middle class stays stuck in economic quicksand.

The IRS data show that the share of all income earned by the wealthiest 10% of Americans has actually fallen since 2001. The rich are earning less of the total income but paying more of the total taxes.

During this economic expansion, the middle class is growing and becoming more prosperous. About 4 out of 10 Americans now make more than $50,000 a year -- that's up from 3 out of 10 in 1990.

What about tax cuts in general? Tax cuts we couldn't afford.

There's more good news. Tax revenues over the past two years are up more than half a trillion dollars — the largest two-year increase in tax collections in history.

Bush cut the capital gains and dividend taxes, but guess what? Now those tax receipts are through the roof in the last two years.

It's true. If you compare budget outlays vs income, we're spending more than we're taking in. But that's not the fault of tax cuts. We're taking in more! (See Laffer Curve) We're just spending a heck of a lot more.

Unfortunately that finger points at all of Congress and the President.