Big Winners in Stimulas Compromise: Upper-Middle Class

[katty]

Thomas B. Edsall

more: http://www.huffingtonpost.com/2009/02/11/the-big-winners-in-stimul_n_166192.html

-- Amt Patch, Amt Taxes Stimulus Bill, House Senate Compromise Stimulus Bill, House Stimulus Bill, Senate Stimulus Bill, Stimulus Bill, Politics News
When President Obama outlined on January 8 the rationale for the economic stimulus bill, "The American Recovery and Reinvestment Act," he clearly identified the men and women most in trouble:

Nearly two million jobs have now been lost, and on Friday we are likely to learn that we lost more jobs last year than at any time since World War II. Just in the past year, another 2.8 million Americans who want and need full-time work have had to settle for part-time jobs.
The House-Senate compromise, however, cuts funds for extended health care coverage for the unemployed; cuts $30 billion in aid to state governments to prevent reductions in social services to the poor and out-of-work; and also cuts a special "Making Work Pay" tax holiday from $500 to $400 for an individual, and from $1,000 to $800 for a couple, for low-to-middle-income workers still hanging on to their jobs

Amid all the cutting, however, one group emerged unscathed: the upper-middle class, the not-quite-super-rich, but certainly not on the ropes. Most of these folks, in terms of income and employment, are what could be called the un-needy, a group clearly distinct from those Obama identified as the core target of the legislation. The "compromise" legislation includes $70 billion, or just under 10 percent of the whole package, to be used expressly to take care of these affluent people.

[bluestateguy]

1. The AMT patch has to happen

If not, you'll have millions of people paying more taxes this year, people who are not rich, but merely comfortable at best. And quite a few people in that income bracket right now are worrying about a possible job loss down the road.

Now we can walk and chew bubble gum at the same time, and I am still opposed to the cuts for the states and for the unemployed.If I had my druthers, this stimulus would be at least 1 trillion $.

Next year the Bush tax cuts for the truly rich will be allowed to expire, and nobody in Congress will have to dirty their hands by casting a roll call vote for it.

In the long run we need to make some more permanent adjustements to the AMT.

[katty]

4. unemployed/states in DIRE need-and THEY get cuts?!!

[Still Sensible]

2. I agree, the AMT fix should not have been included

BECAUSE THE CONGRESS WOULD HAVE PASSED IT ANYWAY as they have for a number of years. The headline is terribly deceiving, IMO, because the real "winners" were REPUBLICANS because they got to basically take $70 billion out of the package. The "upper middle class" would have received the benefit of the fix whether or not it was in this specific bill.

So the purpose of Edsall's article must have been to pit factions of the "middle class," which clearly support stimulus spending, against each other, no? It was not the "upper middle class" that was hammering the democrats to include this in the Recovery Act... It was the fucking republicans in the Senate and House. Period.

[katty]

3. concur-real winners are the Repubs

[cascadiance]

5. I wonder how much taking away AMT really helps in this year anyway...

There are not too many parts of the economy where people are going to have unrealized capital gains, especially in the middle class segment, which is usually where AMT kicks in. If you buy some stock at the wrong time and don't sell it (because it was worth more at the time you bought it for something like company stock options/plans), or if you own a home that's on paper given you a lot of value but don't sell it, then you might get hit.

Yes, AMT needs to be reindexed for inflation... That's really the only change that should be made, so that those at the upper end of the scale still get hit. There are many very recently upper middle class folks that don't own homes now, or have been foreclosed on, who I don't think AMT will really hit anyway, and are probably the people most in need of a stimulus now too, and many who've stayed renters (like me), who don't want to get caught in this home buyer mess, who also wouldn't get hit by AMT, who don't really benefit from this.

I got hit by AMT once when exercising company stock options, back during the dotcom boom/bust cycle, and coincidentally had to pay tax on unemployment I received during the same year. Go figure.

[greenbird]

6. What's the income definition

of upper middle class?

[Two Americas]

7. no surprise there

The discussion on what passes today for the political Left in this country is dominated by a relatively small minority within liberalism and the Democratic party, people from the upper 10% income bracket. All of the positions, causes, and the policy agenda are heavily weighted to favor them, and all of the discussion is skewed by that.