Taxes under Clinton vs taxes under Junior

[Lasher]

You want lame? I got lame right here:

IRS agent's observations

After watching the democratic debate the other day in Vegas, I literally wanted to puke. For the most part, all of them bashed Bush over and over again on how he is out for his millionaire friends and the big oil companies and he has totally forgotten or disregarded the little guy. So being an ex-IRS employee, I decided to look back on the tax tables to see if there is any truth to what they said and the media keeps stating as fact, "Bush is only out for the rich in this country.

Based on using the actual tax tables (see link below), here are some examples on what the taxes were/are on various amounts of income for both singles and married couples. so let's see if the Bush tax cuts only helped the rich.

http://www.taxfoundation.org/publications/show/151.html

Taxes under Clinton 1999             Taxes under Bush 2008 
Single making 30K - tax $8,400       Single making 30K - tax $4,500                             
Single making 50K - tax $14,000      Single making 50K - tax $12,500 
Single making 75K - tax $23,250      Single making 75K - tax $18,7 50 
Married making 60K - tax $16,800     Married making 60K - tax $9,000 
Married making 75K - tax $21,000     Married making 75K - tax $18,750 
Married making 125K - tax $38,750    Married making 125K - tax $31,250

If you want to know just how effective the mainstream media is, it is amazing how many people that fall into the categories above think Bush is screwing them and Bill Clinton was the greatest President ever. If any democrat is elected, ALL of them say they will repeal the Bush tax cuts and a good portion of the people that fall into the categories above can't wait for it to happen. This is like the movie The Sting with Paul Newman, you scam somebody out of some money and they don't even k now what happened. Now this is effective (maybe not honest) marketing or maybe a better word is brain washing.

Rebuttal offered by DUer Hay Rick in the Economy forum:

Inconvenient truth number 1.

Neither Obama nor Clinton has advocated repealing tax cuts for people in the tax brackets that the author lists. They both speak of eliminating cuts for taxpayers earning in excess of $250,000 per year. In fact, both candidates speak of expanding tax cuts and/or tax credits for the middle class. Taxes that mainly impact the rich and which Democrats would like to see restored to former levels, or at least higher than current levels, are the capital gains, dividend, and inheritance taxes.

Inconvenient truth number 2.

The numbers he claims to get from the referenced tax tables are not the numbers you actually get if you apply the tax tables to the example incomes. I do the author's first example below. Try it yourself!

Married Filing Jointly 2008 Single 2008
Marginal Tax Brackets Marginal Tax Brackets
Tax Rate Over But Not Over Tax Rate Over But Not Over
10.0% $0 $16,050 10.0% $0 $8,025
15.0% $16,050 $65,100 15.0% $8,025 $32,550
25.0% $65,100 $131,450 25.0% $32,550 $78,850
28.0% $131,450 $200,300 28.0% $78,850 $164,550

Married Filing Jointly 1999 Single 1999
Marginal Tax Brackets Marginal Tax Brackets
Tax Rate Over But Not Over Tax Rate Over But Not Over
15.0% $0 $43,050 15.0% $0 $25,750
28.0% $43,050 $104,050 28.0% $25,750 $62,450
31.0% $104,050 $158,550 31.0% $62,450 $130,250

The author's numbers:
1999 (Clinton) Single making 30K - tax $8,400
2008 (Bush) Single making 30K - tax $4,500
claimed difference: $3,900

Actual numbers from tables:
1999 (Clinton) Single making 30K - tax $5,052
(0.15 x $25,750 = $3,862.50) + (0.28 x $4,250 = $1,190) = $5,052.50
2008 (Bush) Single making 30K - tax $4,099
(0.10 x $8,025 = $802.50) + (0.15 x $21,975 = $3,296.25) = $4,098.75 actual difference: $953

In this case, 76% of the claimed "tax cut" evaporates as soon as you actually do the math.

Inconvenient truth number 3.

Inflation breeds bracket creep. This phenomenon is simultaneously creating the Alternative Minimum Tax predicament. The author neglects to adjust incomes for inflation in his examples, thereby avoiding the effects of bracket creep. Let's correct that "oversight" for him. Here's an inflation calculator- http://www.westegg.com/inflation /
The calculator only goes up to 2007, so I will use 1998-2007 as a proxy for my example. The calculator says I need approximately $38,619.94 to maintain purchasing power equivalent to $30,000 in 1999. Going back to the tax tables, the tax on this equivalent income is $5,998. The Bush "tax cut" is now actually a tax increase. In fairness, the increase is in inflation-debased dollars and is offset by increased income. However, whatever is left of the "middle class" part of the Bush tax cuts is looking pretty trivial by now.
If only the story ended there.

Inconvenient truth number 4.

Deficit spending. Is a tax cut really a tax cut if it is accompanied by borrowing that exceeds the amount of the tax cut several times over? The borrowed money will have to be repaid with interest in the future, either by current tax payers or their descendants. Of course, it is impossible to know how much of the deficit will be repaid by current taxpayers and when. The total amounts, however, are well known. The total federal budget data for the chart below is taken from the non-partisan Congressional Budget Office. Draw your own conclusions. All figures are in billions.

Year Income Tax Receipts On-Budget Deficit* Total Deficit
2000 Clinton 1,004.5 86.4 (surplus) 236.2 (surplus)
2001 Bush 994.3 -32.4 128.2 (surplus)
2002 858.3 -317.4 -157.8
2003 793.7 -538.4 -377.6
2004 809.0 -568.0 -412.7
2005 927.2 -493.6 -318.3
2006 1,043.9 -434.5 -248.2
2007 1,163.5 -344.3 -162.8

*The on-budget deficit excludes the Social Security "surplus" which is borrowed by the Treasury to pay current expenses. That money is owed to retirees in the future. If it is not repaid in full, the Bush tax cuts will also turn out to be benefit cuts.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=114&topic_id=34392&mesg_id=34392