Politics with Marc Ambinder

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Feb 17 2009, 12:38 pm by Marc Ambinder

The Biggest Tax Cutter

Don't know if anybody has yet noticed in the Republican Party but President Obama was presented last week a major talking point for 2012.

He'll sign today one of the largest tax cuts in history.

In spite of the White House pointing this out to journalists, it is funny how little remarked-upon this is.

It's hard imagine we won't hear about this  four years from now. And if that's not boxing a future Republican candidate in ahead of time, I don't know what is.

Think about how many potential Republican arguments are going to be pre-empted by that nice little fact?

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Comments (9)

indieoh

Facts are stubborn things and it will be very hard for republicans to digest the fact that Obama has given one of the largest tax cuts in the history. May be republicans can complain that these tax cuts do not count because vast majority of them did not go to top 2% super-rich countryclub folks.

jb (Replying to: indieoh)

Now a chance to hear from one of the so-called rich. I work two jobs, my wife works one...sometimes as much as 70 hours a week. We work hard. Our income last year was at about 170,000 a year. We see very little in this tax package that will benefit us. We make too much for my son to get financial aid (understand that), but we don't get to take an exemption for college tuition for him or for me (who has to take classes for my job). You wonder why we are bitter about this....there it is.

So what are our options....make less? Make more and let the government take more?

And if your solution is to give up one of my jobs so that someone else may work...my second job is an adjunct teaching position that requires a MS degree and experience in my field...it isn't something that just anyone can take.

colby (Replying to: jb)

Jb, you keep talking about what your "options" are and what our "solutions" might be, but you haven't really articulated a PROBLEM.

I don't mean that to sound insensitive, but you make more than my household and my parents' household COMBINED. Now, my wife and I pull 70 hour weeks, and we both have student loans to pay off, so we're kinda analogous to you (Except that you make way more money than us). And we're getting by- quite comfortably, in fact, in a pretty expensive city- without the tax cuts. So it's pretty obnoxious to hear someone who's making a LOT more than us complain about not getting a cut themselves, especially as you haven't identified any particular hardship that's forcing on you.

Daniel

Hey Jb:

Here are a few ideas:
1. You could make more money, and keep about 70% of it while the government gets the rest (what a raw deal for you, this whole income tax thing!).
2. You could send your son to a less expensive school.
3. Your son could take loans.
4. You could stop bitching and be happy in this horrible crisis that you have jobs and a household income of $170,000 a year, which easily puts you in the top 10% of households in America.
5. You could reduce expenses so that you find a way to save some of the $10,000 a month after taxes that flows into your household.
6. You could be happy with the big time tax cuts you got under the Bush administration.

I think you've got a lot of options. Hijacking a thread to complain about how you're not getting yours in this bill (which, you might imagine, given your income and the fact that you have jobs, rightly doesn't target you) doesn't seem like your best choice.

Thanks.

jb (Replying to: Daniel)

Here is what you miss.

1. I am sorry, it isn't 70% and I think that I am giving more than my fair share already.
2. It is a state school! I wish I could send him to a nice private school but we haven't figured that out yet.
3. He will be.
4. I am not bitching, I am simply pointing out why many of us are very exasperated. I work hard for my dollars, why should I give them to the government to give to somebody who decides they are going to have 14 kids and not work! I know that case is an exageration, but I had times when I was unemployed, I made a career change, I did what I needed to provide for my family.
5. It isn't $10,000 that is for sure. At most it is $7500. Of that 20% goes to a mortgage, some goes to car payments, some goes to insurance. Besides, it is nobody's business buy my own what I choose to do with what we earn.
6. Lets see, I got virtually nothing from the stimulus check passed by Bush. I don't know that I saw any huge cut in taxes under him as well.

As for hijacking thread, I merely gave perspective to indieoh's point. I am not a Republican, but I do think I represent a large number of people who resent the government taking money and then squandering it.

BTW, how much are you going to be able to buy with your whopping $13.00 a week? And two years for now how much are all of us going to have to pay in increased tax to pay for all of the garbage in the spending side of this bill. I for one don't see me travelling the 2 Billion dollar rail system from Disneyworld to Las Vegas.

OGLiberal (Replying to: jb)

@jb:

I understand what you were getting at. And I think Daniel's response was a bit harsh, to say the least. My household income is less than yours but not by much...and that's from a single income. I don't expect to see much at all from the stimulus package either. But I didn't expect anything immediate....nor is my family in dire need of economic support. I know there are tens of millions of Americans who are in worse shape than I am, sometimes much worse shape. What I appreciate in the package are the increased benefits for the unemployed. It gives me peace of mind because, while I'm currently employed, I may not be tomorrow...or next week. (I work in the evil financial services industry)

I live near some pretty economically distressed neighborhoods and I can say that while 13 bucks a week may not seem like much to you and I, it can be a lot to people who are only pulling in $40K a year or less - ie, most of the country. And there are many economists who say that giving the $400/$800 dollars in weekly amounts for a longer period of time rather than giving them in one single lump sum payment (as was done last year) makes it more likely that the money will get spent because a) it's too small to use to save or pay down debt and b) people know that it's coming every week for the next 1-2 years, it's not a one time deal - so they'll change their monthly budgeting to account for this increased income, even if it isn't that big. I appreciate this because if those less economically privileged folks spend more money - 13 bucks a week multipled by millions and millions of people can result in a lot of spending - the economy will pick up, meaning the markets will pick up...and that will make it less likely that I will lose my job due to layoffs.

As for the dig at the LA to Vegas rail line - you need people to build that line - ie, jobs. And once completed, it will make it easier for people to make that trip, meaning more customer for business owners in LA and Las Vegas. This isn't a bridge to nowhere - it's a train line to service one of the most popular routes in the West, a route currently only accessible by air or car. And while improving the environment isn't and should not be the goal of this stimulus package, less people driving too and from LA to Vegas means less pollution - a nice side benefit.

colby (Replying to: jb)

"Besides, it is nobody's business buy my own what I choose to do with what we earn."

See, the thing is, you can't have it both ways. You can't come on a blog, bitch about your financial problems, ask for options, and then say your finances are "nobody's business" when someone suggests that your OWN spending habits need adjustments.

"BTW, how much are you going to be able to buy with your whopping $13.00 a week?"

Err...quite a bit. That's a meal or two a week, or a new pair of pants every two weeks, or a quarter of monthly rent in a LOT of places.

Ike

WOW! Unprecedented I'd say.

AlchemyToday

I compared Bush's 2001 cut to the stimulus cuts in terms of change in after-tax income by quintile: http://alchemytoday.com/2009/02/10/how-will-the-gop-explain-voting-against-one-of-the-biggest-middle-class-tax-cuts-in-history/

For 80% of people, the stimulus cuts are just about as large or larger than the Bush cuts, which was the biggest cut in history. Obama's is probably bigger in the short-run since a lot of the Bush changes phased in over a few years.

Also, I ran the numbers and found that between 83 and 89% of the tax cuts in the stimulus bill (by cost over 10 years) were things promised to be passed in 2009 during Obama's campaign. Pretty brilliant to include the inevitable and get Republicans to vote against tax cuts. They'll probably vote against the next tax bill as well for similar reasons, and it'll be hard to run away from those votes in 15 months. The next bill will increase the Making Work Pay cut and presumably include the promised no-income-tax-for-seniors-under-50k cut. Both of those should be winning issues.

Senate Dems were pretty brilliant in timing the sunset provisions they forced into the Bush cuts. They phase out for the tax year after 2010 and will be debated during a non-election year in congress to minimize the impact of failing to prevent a tax increase.