In an upswing economy where jobs are being generated in the country, tax cut for the wealthy may work.  But that is not where we are at.

U.S. has progressive taxation model, that in effect is more punitive to the poor already. On top of which, Pres.W.Bush gave very hefty tax cuts. That in addition to the highly costly wars has left the country bleeding beyond belief.

Unfortunately for the U.S., the 6+ years of tax cut for the rich has not produced jobs.

We are in a wage differential situation that is not advantageous to the country. The rich are sitting on the extra cash that the tax break is giving and not ploughing it back into the U.S. economy.

Meanwhile, the country is loosing jobs.

Perhaps the worst statistic I have seen is the one that looks at growth of hourly wages over the last 50 years. In 1972, the average worker earned 20 dollars an hour (inflation adjusted to 2008 dollars). In 2008, that had DROPPED to 18.50 per hour:


Meanwhile, inflation has been up already...and even today, I noticed my grocery bill was higher than prior - it is noticeable in household spending on same goods on basics - veggies, fruits, milk, pasta, rice, milk, some cheese, stock popcorn, some butter - nothing grand.  Veggies and fruits prices in particular has more than doubled in just this last year.

And another chart that shows the income growth rate of the top strata. It is too ridiculous.  


Listen to David Stockman, Ronald Reagan's budget director in Deficits: Taxing The Rich.  Among the many things that Stockman says that are truly astounding is this tidbit: People in the top 2% of income bracket made more money ince 1980 than all of humanity combined before 1980.  This, as we have seen the above decline in true wages of thoe on payroll, not to mention heavy loss of jobs leading to total reduction of the count on payroll itself (denominator of the equation that computes the above graph).

Yes, there was a good reason why Pres.Bill Clinton's progressive taxation worked. He used the money to put it back into the economy for structural improvement and combined that with incentive payout to businesses that generated jobs.

I like expense reduction.  But it cannot come at the expense of education and health care at a tiem when the population is aging (average age is fast going up) and the skillbase of the country is not easily competing in the global economy. 

We simply do not have the luxury of letting things go the same course as last 6+ years on how the rich utilize their savings (from not paying taxes).

I favor tax cut for those with income below $250k, which is what Hillary had in her plans.  She too planned on utilizing the added tax income from bringing tax rate back upto Pres.Bill Clinton's tax rate and utilizing the additional income towards Universal Health Care and infrastructure and education.  She talks about that in this toward the latter part.


-- Edited by Sanders on Sunday 7th of November 2010 08:24:20 PM