Robert Reich again makes case for $500,000 tax cut threshold (it's where the money is)

[flpoljunkie]

Robert Reich: Obama must oppose tax cuts for rich

Sunday, November 21, 2010

Let's hope the president holds his ground on not extending the Bush tax cuts to the richest Americans - who don't need it, don't deserve it and won't help the economy if they get it.

But instead of limiting his proposed extension to those with incomes of $250,000 or less (the bottom 98 percent of Americans), he should offer it to incomes under $500,000 (essentially the bottom 99 percent) for two years.

The real explosion of income and wealth has occurred in the top 1 percent.

Between 2002 and 2007, the bottom 99 percent of incomes grew 1.3 percent a year in real terms, while the incomes of the top 1 percent grew 10 percent a year. During these years, the top 1 percent accounted for two-thirds of all income growth.

Over the past three decades, the top 1 percent's share of national income has more than doubled.

So there's no reason the top 1 percent should continue to get the Bush tax cut. The top 1 percent spends a much smaller proportion of their income than everyone else. That means there's very little economic stimulus at these lofty heights.

Giving them a two-year extension would cost the Treasury $130 billion over two years, blowing a giant hole in efforts to get the deficit under control.

That $130 billion would be enough to rehire every teacher, firefighter and police officer laid off over the last two years and save the jobs of all of them now on the chopping block. Not only are these people critical to our security and the future of our children, but, unlike the top 1 percent, they could be expected to spend all of their earnings and thereby stimulate the economy.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/11/21/IN0E1GD112.DTL

[impik]

1. If Obama even dares to propose this, you'll have the left blogosphere going on fire

People couldn't care less about the right solutions. They only cares about being in a war 24/7.

[Bluenorthwest]

3. Upon what do you base that opinion?

I'm on the left, and I think 500K is the right level to go for. The big money gains have been way, way at the top. Over 500k taxable income. Sounds perfect to me. I'd also like to see the return of income averaging, to protect those whose income varies greatly from year to year, Reagan ended that one.
Most of the people I know agree that 500K is a better level. Where are you getting your information?
Or is it just another excuse to take another swipe at those not as far to the right as yourself?

[jemsan]

7. I agree also. I think 500,000k is the way to go. And I'm a liberal from way back.

[Name removed]

6. Deleted message

Message removed by moderator. Click here to review the message board rules.

[TheWraith]

12. Since when are internet-bubble "progressives" happy with good policy? nt

[mzmolly]

10. Yep.

"Mr. President, we will not vote for you, you caver you!"

[Skink]

2. I think the Republican extremist motivation is to destroy the economy.

I don't think it would even harm the republican base to raise taxes to Clinton era levels. It might even help get the party back to their core values of fiscal restraint.

[flpoljunkie]

4. Republicans are quite willing to see the economy go to hell in a hand basket to win in 2012

After all, it worked quite well in 2010. The Democrats must make clear whose side they are on and make the case to the American people--over and over, like the Republicans and their echo chamber.

[moondust]

11. delete

[DBoon]

5. Reich approaches this issue with a rational mind towards policy

Unfortunately, rational policy choice has nothing to do with the Republican opposition

[Pisces]

8. Great idea. Show the public what Repukes really stand for. This sounds

like a good compromise to me. I am a progressive that would support this move.

[TheKentuckian]

9. As someone who thinks they should all go minus the bottom bracket

It doesn't bother me much anymore than the 250k line. Essentially, the whole thing is really fucking stupid when one looks at our other critical needs but I doubt the 250-499k area makes that much of a difference.

I do agree with the poster above that averaging should be used.