In reading through comments made by Treasury Secretary Timothy Geithner this week he continued the mantra of the current administration with the arguement that President Obama's 2010 budget proposal would reduce taxes for most Americans.
Geithner said Obama's plan would cut income taxes for 95 percent of families and 97 percent of small businesses. Raising taxes on couples that make more than $250,000 would make the tax system more equitable, restoring the balance that existed before a series of tax cuts were enacted under former President George W. Bush, he said.
Let's focus on that statement "would make the system more equitable". I was able to pull up this chart and that shows how inequitable the administrations proposed plan really is. To highlight a few key points, in 2006 the top 1% income earners in the paid 40% of all taxes, the top 25% of earners covered 86% of all taxes and the top 50% covered 97% of all taxes paid. To flip the analysis the bottom 50% of income earners pay 3% of all taxes paid, how about a little plain english - for every $100 of taxes paid $3 is paid by the bottom 50% of income earners - and now that's going to decrease? Now these numbers have changed slightly since 2006, but they are not tilting in the other direction. This seems a little bit more like a "Robin Hood" theory doesn't it - take from the rich to make payments on a budget plan that is far from fiscally responsible. Here's a quick fact for you - under the current proposed budget plan, the federal deficit will DOUBLE, that's right, double, over the next 5 years. I tried that theory on the CEO of my household - "fiscally responsible" wasn't quite the term my wife ascribed to my financial plan. No, but really hon, I swear I can unload this debt off on China for some good rates...
Now let's consider this statement from an Obama staffer - "Over the past two or three decades, the top 1 percent of Americans have experienced a dramatic increase from 10 percent to more than 20 percent in the share of national income that's accruing to them," said Peter Orszag, Obama's budget director. Now, he said, was their time "to pitch in a bit more." Kind of feels like someone is sticking their tongue out at those of us who choose to work hard, take risks and prosper, doesn't it. That last statement from the budget director really says it all, doesn't it.
So in closing, let's summarize this economic plan - take more money from those who have it, giving them less to invest and spend and how will that stimulate the economy?
