I know alot of people are concerned about the unemployment benefits expiring so therefore think they need to side with the president on this HUGE tax cut and spending bill. Not only does MoveOn believe the #1 problem is the cut in payroll tax, making it a trap for Democrats, I think the whole damn thing is a trap. I do not buy the argument the bill is the best Democrats could get from those Republicans. I believe the worst parts of this legislation won't be felt immediately, but rather in the near future as the GOP continues their fight to make the tax cuts permanent and their plan to destroy Social Security. This is not 2003, I don't know if the will of the people can actually fight the evil machine that is the Republican Party. That's my opinion and I'm comfortable with it....
Problem #1: The deal is a stealth attack on Social Security.The deal will lower the payroll tax—the tax
that funds the Social Security trust. This is a trap for Democrats.
Republicans have been coming after Social Security for years and this
cut is the biggest threat to the vital program in decades. It will cut
one-third of Social Security's funding this year alone and when we need
to restore the payroll tax back to its current level, Republicans will
cry "tax increases" and could gut it permanently. 1
Problem #2: For nearly one in three workers, it's a tax increase.Nearly 50 million working
Americans—including all workers making less than $20,000 per year—and
millions of federal, state, and municipal workers will see their taxes
go up because of the deal.2
Problem #3: The deal has not one but TWO millionaire bailouts.In addition to extending all the Bush income
tax breaks for the top 2%, the deal will slash the estate tax. If
Congress did nothing, next year the estate tax would be 55% and apply to
everyone inheriting $1 million or more. But the deal reduces it to 35%
and only people who inherit more than $5 million will have to pay. This
second bailout will give a gigantic tax giveaway to a few thousand of
the richest families in the country and add hundreds of billions to the
national debt.3
Problem #4: Unemployment help is insufficient and inadequate.While the deal extends unemployment benefits
for another 13 months for people currently receiving it, millions of
unemployed workers who've struggled the most and been out of work more
than 99 weeks—since the giant Wall Street banks wrecked the economy—will
get no help at all under the deal.4 It's a gamble that there
will be jobs in the next 13 months when the insurance runs out, but the
tax cuts will go well beyond that. Better to just pass a stand-alone
unemployment extension to help all struggling Americans.
Problem #5: Tax giveaways to the rich are a terrible way to create jobs.Tax breaks for the rich are the least
efficient way to create jobs and help the economy grow. In fact the
nonpartisan Congressional Budget Office says extending all tax cuts
would lower unemployment only 0.1% to 0.3% over the next year5 and that the cost of the tax deal would be $900 billion over the next five years.6
Sources:
1."Tax Cut Deal A Hidden Threat To Social Security" The Huffington Post, December 8, 2010
http://www.huffingtonpost.com/2010/12/08/tax-cut-deal-a-hidden-thr_n_793983.html
2. "Obama-Republican Deal Could Mean Tax Hike For One In Three Workers" The Huffington Post, December 10, 2010
http://www.huffingtonpost.com/2010/12/10/obamarepublican-deal-coul_n_795187.html
3. "Estate tax deal: worst part of a bad tax compromise" The Christian Science Monitor, December 7, 2010
http://www.csmonitor.com/Business/Tax-VOX/2010/1207/Estate-tax-deal-worst-part-of-a-bad-tax-compromise
4. "Unemployment benefits: Extension won't help '99ers'" The Christian Science Monitor, December 7, 2010
http://www.csmonitor.com/Business/Latest-News-Wires/2010/1207/Unemployment-benefits-Extension-won-t-help-99ers
5. "The Deal" Paul Krugman, The New York Times, December 7, 2010
http://krugman.blogs.nytimes.com/2010/12/07/the-deal/
6. "CBO score shows tax plan ups deficit $900 billion in 5 years" CNN.com, December 10, 2010
http://articles.cnn.com/2010-12-10/politics/tax.plan_1_tax-cuts-tax-plan-bush-era-tax?_s=PM:POLITICS
UPDATE; From CBS news:
The Senate passed the tax bill today,
The first priority for many Democrats who want to alter the bill is changing the estate tax provision in the bill. The president agreed to a request from Sen. Jon Kyl (R-Ariz.) that would allow estates worth up to $10 million to be exempt from paying any taxes at all with estates worth more taxed at just 35 percent.
House Democrats passed a bill a year ago that would exempt estates only up to $3.5 million and taxing them after that at 45 percent and they are fighting to insert that language into this bill. Rep. Chris Van Hollen (D-Md.) is leading the effort to change the Senate provision. He calls it "egregious" and says that it won't create jobs and adds "15 billion dollars to the deficit and benefits just 6,600 families a year." Rep. Earl Pomeroy (D-N.D.), who offered the amendment, says he think it will get a vote.
But now Democrats also want to change other items that were supposed to be sweeteners for Democrats like the 13 month extension of unemployment benefits and the two-year payroll tax holiday that cuts everyone's social security taxes by 2 percent.
On unemployment insurance, Rep. Elijah Cummings (D-Md.) says that it should be extended from 13 months to two years so that it is not seen as less important than the two-year extension of tax cuts for the wealthy. He admitted last night after talking with the president over the phone that it's a delicate balance.
"Right now it's a question of how much can be changed without ruining the president's efforts to get this thing through" Cummings said.
On the payroll tax holiday,
members like Rep. Lloyd Doggett (D-Texas) argue that the one-year
payroll tax holiday would force the government to borrow money to make
up for the losses in the Social Security Trust Fund, that the tax cut
would likely never expire and that it would jeopardize Social Security's
solvency. "I plan to present an amendment asking that the payroll tax provision is stricken from the bill" Doggett said.
If any of the amendments or changes pass the House, the bill would have to pass the Senate again and its passage could be in doubt just over two-weeks from all the Bush tax cuts for the wealthy and the middle class expiring.
While the loudest Democrats oppose many of the provisions in the Senate-passed bill, there is support for the measure among fiscally conservative Blue Dog Democrats. Thirty-one House Democrats sent a letter to Speaker Nancy Pelosi last night asking her to quickly schedule a vote, put aside partisan differences, and "act to send it directly to the president's desk without delay."
If those members vote against changing the tax bill, along with most Republicans, it will be very difficult for House Democrats to change the bill.
Opposition among Republicans also mounted today, with Rep. Mike Pence (R-Ind.) heading to the House floor first thing to announce his opposition to the package. His objection? That unemployment insurance provisions are unpaid for and that the tax cuts are not permanent so they will not help businesses plan.
"Uncertainty is the enemy of our prosperity" Pence said. "Frankly, we can provide assistance to people struggling in this economy by making the hard choices to pay for it without adding to the national deficit."
Pences' statement made me (((((shudder))))
http://www.huffingtonpost.com/2010/12/08/tax-cut-deal-a-hidden-thr_n_793983.html
2. "Obama-Republican Deal Could Mean Tax Hike For One In Three Workers" The Huffington Post, December 10, 2010
http://www.huffingtonpost.com/2010/12/10/obamarepublican-deal-coul_n_795187.html
3. "Estate tax deal: worst part of a bad tax compromise" The Christian Science Monitor, December 7, 2010
http://www.csmonitor.com/Business/Tax-VOX/2010/1207/Estate-tax-deal-worst-part-of-a-bad-tax-compromise
4. "Unemployment benefits: Extension won't help '99ers'" The Christian Science Monitor, December 7, 2010
http://www.csmonitor.com/Business/Latest-News-Wires/2010/1207/Unemployment-benefits-Extension-won-t-help-99ers
5. "The Deal" Paul Krugman, The New York Times, December 7, 2010
http://krugman.blogs.nytimes.com/2010/12/07/the-deal/
6. "CBO score shows tax plan ups deficit $900 billion in 5 years" CNN.com, December 10, 2010
http://articles.cnn.com/2010-12-10/politics/tax.plan_1_tax-cuts-tax-plan-bush-era-tax?_s=PM:POLITICS
UPDATE; From CBS news:
The Senate passed the tax bill today,
The first priority for many Democrats who want to alter the bill is changing the estate tax provision in the bill. The president agreed to a request from Sen. Jon Kyl (R-Ariz.) that would allow estates worth up to $10 million to be exempt from paying any taxes at all with estates worth more taxed at just 35 percent.
House Democrats passed a bill a year ago that would exempt estates only up to $3.5 million and taxing them after that at 45 percent and they are fighting to insert that language into this bill. Rep. Chris Van Hollen (D-Md.) is leading the effort to change the Senate provision. He calls it "egregious" and says that it won't create jobs and adds "15 billion dollars to the deficit and benefits just 6,600 families a year." Rep. Earl Pomeroy (D-N.D.), who offered the amendment, says he think it will get a vote.
But now Democrats also want to change other items that were supposed to be sweeteners for Democrats like the 13 month extension of unemployment benefits and the two-year payroll tax holiday that cuts everyone's social security taxes by 2 percent.
On unemployment insurance, Rep. Elijah Cummings (D-Md.) says that it should be extended from 13 months to two years so that it is not seen as less important than the two-year extension of tax cuts for the wealthy. He admitted last night after talking with the president over the phone that it's a delicate balance.
"Right now it's a question of how much can be changed without ruining the president's efforts to get this thing through" Cummings said.
If any of the amendments or changes pass the House, the bill would have to pass the Senate again and its passage could be in doubt just over two-weeks from all the Bush tax cuts for the wealthy and the middle class expiring.
While the loudest Democrats oppose many of the provisions in the Senate-passed bill, there is support for the measure among fiscally conservative Blue Dog Democrats. Thirty-one House Democrats sent a letter to Speaker Nancy Pelosi last night asking her to quickly schedule a vote, put aside partisan differences, and "act to send it directly to the president's desk without delay."
If those members vote against changing the tax bill, along with most Republicans, it will be very difficult for House Democrats to change the bill.
Opposition among Republicans also mounted today, with Rep. Mike Pence (R-Ind.) heading to the House floor first thing to announce his opposition to the package. His objection? That unemployment insurance provisions are unpaid for and that the tax cuts are not permanent so they will not help businesses plan.
"Uncertainty is the enemy of our prosperity" Pence said. "Frankly, we can provide assistance to people struggling in this economy by making the hard choices to pay for it without adding to the national deficit."
Pences' statement made me (((((shudder))))
29 comments:
I "reject" the word compromise. :-)
I'd like to do a comparison on the rights reasons why they hate this bill, with the lefts reasons why. It's pretty interesting...
Problem #6: America's credit rating may be downgraded. A New York Times article titled, "Moody's Says U.S. Debt Could Test Triple-A Rating", says, "...The bigger risk would be to the country's ability to keep borrowing money on extremely favorable terms, and therefore to keep spending more money than it takes in from tax revenue. ...That difficulty [created by a lowered credit rating] has been well-illustrated recently in Greece and Portugal, with strikes and protests as citizens march in the streets to oppose tough austerity measures that directly reduce entitlements and state benefits".
I think this is a part of the Republican trap. They would be thrilled if a lower credit rating allowed them to institute austerity measures and slash entitlements.
The more I understand about this compromise, the less it seems like a compromise and the more I dislike it.
What did the republicans give up?
Under this agreement, the poor get less and the rich get more. Where the hell is the compromise? This is an agreement that takes from those that can't afford it and gives it to those that don't need it.
w-dervish
Austerity is coming you can count on it.
Along with the attack on Soc. Sec.
Wait until around April when they have to vote on raising the debt ceiling.
Moody's rating is not the big problem.
Here is the main problem that is a ticking time bomb.
http://www.globalresearch.ca/index.php?context=va&aid=22402
Welcome, Sue! We're glad to have you on board :)
I pointed out the other day that this was a dual pronged attack on both Social Security and the poor, and I got a lot of grief for it. I don't care-I have absolutely no intention whatsoever of casting another vote for Bushack Obama. He's a liar. Just the same as Chimpy is a liar.
JR said: "the poor get less and the rich get more." I'm not sure this is correct. According to a chart I saw today, the Dems get $238 billion and the Republicans get $114 billion.
http://blackwaterdog.wordpress.com/2010/12/14/the-mishmash-7/
Sue, I'm sorry you caved.
This is such a lose, lose situation for our country...and the Republicans who aim to destroy the government as we know it, get a win, win!
I would love to see, Sue, your comparison of the reasons the different sides hate the bill,(cause you know I have given up on politics ) because you know the country will only see the 'rights' point of view thanks to our falsely proclaimed "Liberal Media".
I was reading this credit rating story last night w. It goes from just a concern to VERY serious.
I agree Jerry. At first it seemed like a compromise that had to be, but the more we read the worse it gets. Now this morning they are showing all the pork. I'm shocked the Congress would pass this with just a week or 2 ago serious talks on deficit reduction.
Leslie I don't call it caving, just opening my eyes to some of the details some choose to overlook. This huge bill scares me and I don't think it's necessary. Democrats need to do certain things true, but this bill feels wrong to me. It feels like we are spiraling straight to hell.
I'm not putting all the blame on the president either. I still support him but he is taking advice from the GOP it seems. Where is his common sense?
Correct Sue, excellently reasoned and sourced. This deal is slap in the face of the Middle Class and a giant bow and curtsey to the Plutocrats. It's another step in the creation of Serfdom America.
Obama said he needs to raise a billion dollars to get re-elected.
Where do you think that money is going to come from? He knows which side his bread is buttered on.
thanks goes to MoveOn Gene, I just happen to agree with this breakdown from them.
JR said: "the poor get less and the rich get more." I'm not sure this is correct.
Percentages, tnlib. People like to talk about how our "per capita income" is so high-but once you start doing the percentages, not so much.
Sue, while I agree that the estate tax compromise may have tilted a little too much to the rich, I simply cannot agree that the present system is fair. Right now if a person inherits, say, $175,000 (not exactly a gazillion dollars these days and, yes, money that had already been taxed!), he or she will have to give $46,800 of that immediately back to the federal government. That, IMHO, is outrageous. I mean, the person is probably already mourning and in steps Uncle Sam trying to fleece them. This is a perfect example of why certain people are really starting to hate the government.
Will,
Your information is wrong. A person inheriting $175,000 will pay zero inheritance tax.
There is no, zero, inheritance tax in 2010. If the Bush tax cuts expire (which they will not), the estate tax reverts to 2001 levels. There will be a $1 million dollar exemption, so any inheritance under $1 million dollars will not be taxed.
thanks Jerry. Will, whereever do you get your info?
The exemption for the estate tax under the Obama compromise is 5 million. House Democrats are trying to reduce that to 3.5 million.
But there has ALWAYS been a significant exemption as Jerry points out. It simply doesn't apply to the majority of estates and NEVER has (including the individual who inherited 175K in Will's example).
I'm really beginning to wonder about Will. Is he misinformed or is he misinforming?
Wikipedia "Estate Tax in the United States". According to the table (and using my example of $175,000)), you pay $38,000 on the first $150,000 and an additional 32% on the next $25,000. It adds up to $46,800.
You're right, Jerry, the estate tax was repealed for one year in 2010. The tax table provided was for the tentative rates that begin December 30, 2010.
so why is it fair that if someone inherits 3.5 million or even 5 million then the government has a right to confiscate 55% of that?
To do what waste it as they see fit? It's not like it's Lotto money.
So that means if a Pelosi family member inherits her 20 million dollar vineyard the government has a right to 11 million of that? Which means it would have to be sold in order to pay it. But then again I am sure a politician's family would be exempt. You know because they are special and all.
Will,
If you read down in the Wiki article a little further, you will see a discussion about the exemption and that the table you refer to is the taxable amount AFTER whatever exemption there is.
Will,
You are using the tax tables for INCOME tax - not the estate tax. The exemption is for $1M and anything over that is taxed at 55%. I do taxes for a living so I know what I'm talking about here. My neighbor inheirited $600K from here mother and paid $0 to the Fed.
Oh, and I hate this bill too.
You're right, Jerry. It isn't as bad as I thought. It sounds as if the first million is generally exempt. And it also sounds like anything that goes to the spouse is also exempt (very important, in my mind). So, yeah, definitely my bad......Just for the record, the Economic Growth and Tax Relief Reconciliation Act of 2001 had the exemption increasing over time. In 2001, it was $675,000. In 2002 & 2003, it was 1 million. In 2004-2005, it was 1.5 million. In 2006-2008, it was 2 million. In 2009, it was 3.5 million. In 2010 (and like you said) there was no estate tax. In 2011, it was scheduled to go back down to 1 million. This new tax legislation, I gather, brings the exemption back up to 3.5 million. Whether or not that's a good thing or not, I haven't decided. While I really want to bring down the deficit and, yes, this sounds like a relatively harmless way to do it, the thought of taxing money that's already been taxed and bequeathed to somebody else does seem a little unfair to me. Perhaps a compromise would have been to raise the exemption to somewhere in between (1.5-2 million) and lower the tax rate to 25-30%. That's just my feeling.......No Lisa, that wasn't the income tax table that I was looking at. It was the estate tax table. I just hadn't incorporated the exemption.
Will,
To help with reducing the deficit, what do you think about adding some additional tax brackets at the top instead of about $250,000 being the top bracket. How about a higher brackets at, say, 1 million, 5 million, 10 million, 100 million?
I am totally with you, bro. Like Lawrence O'Donnell said on his show, there's a hell of a big difference between $251,000 a year and 10-20 million a year.
Yeah, like almost a factor of 100!
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