SEARCH BLOG: TAXES.
President Obama wants the people of the United States to believe that he only wants to raise taxes on the rich. After all, the Bush tax cuts only helped the rich, right? The Democrats didn't want the tax cuts in the first place and only agreed to go along on the condition that that could last only ten years.
In 2001, when Bush proposed the tax cuts, Democrats argued they would benefit the wealthy, create long-term deficits and deprive social programs of needed money. Some Democrats at the time were open to a more modest tax cut, especially one less favorable to the rich. Bush could push his tax cuts through Congress only by agreeing they would expire a decade later. [source]Now, President Obama has had second thoughts. Those terrible Bush tax cuts that cut into social programs for the benefit of the rich are all right as long as the rich are excluded. That way they can pay their "fair share."
But what really happened with the Bush tax cuts?
According to official IRS data, the top 1% of income earners paid $84 billionin federal income taxes in 2007 than in 2000 before the Bush tax cuts were passed, 23% more. The share of total federal income taxes paid by the top 1% rose from 37% in 2000, before the Bush tax cuts, to 40% in 2007, after the tax cuts.
In contrast, the bottom half of income earners paid $6 billion less in federal income taxes in 2007 than in 2000, a decline of 16%. The share of federal income taxes paid by the bottomdeclined from 3.9% in 2000 to 2.9% in 2007.
The Bush tax cuts also included a doubling of the child tax credit from $500 per child to $1,000 per child. Because of that, and the 33% cut in the bottom tax rate, nearly 8 million more people dropped off the federal income tax rolls entirely, paying zero federal income taxes. Indeed, under the Bush tax cuts, the bottom 40% of all income earners not only paid no federal income taxes, as a group on net. By 2009, they were beingcash by the IRS equal to 10% of all federal income taxes.
These Bush tax cuts did not explode the deficit, as Obama and his echo chamber have alleged. By 2007, the deficit was down to $160 billion, less than 15% of Obama’s deficits today. Total federal revenues soared from $793.7 billion in 2003, when the last of the Bush tax cuts were enacted, to $1.16 trillion in 2007, a . Capital gains revenues had doubled by 2005, despite the 25% capital gains rate cut adopted in 2003. Federal revenues rose to 18.5% of GDP by 2007, above the long term, postwar, historical average over the prior . CBO was projecting surpluses to return indefinitely in 2012 through the end of its projection period in 2018. [source]Well, the fiscal crash happened and federal revenues dried up as personal wealth dried up. Blame it on the rich... which is exactly what the Democrats are doing.
So, what makes the Democrats believe that by reversing the Bush tax cuts for those earning over $250,000 per year revenues will increase... when revenues increased when the tax rates were cut? Actually, President Obama doesn't believe that at all. This is nothing more than an extension of his politics of class warfare that will do nothing to solve the excessive spending problem of the Federal government and do everything to stifle economic growth an tax revenues.