Bush Tax Cuts: Soaking the Rich

I heard an interesting commentary on Marketplace.org the day by Steve Moore, of the Wall Street Journal, discussing the effects of the Bush tax cuts. Contrary to what most on the Left believe, and what the MSM continually reports, the Bush tax cuts have substantially move the burden of income tax to the rich and off the poor. The rich are paying more taxes than ever before, and income tax dollars paid to the government are up over the last two years more than ever before in US history.

The Bush tax cuts have been routinely assailed as multimillion dollar giveaways to the Rolls Royce owners of America at the expense of the middle class.

But new IRS statistics on the taxes Americans pay show that George Bush's tax policies actually soak the rich.

It turns out that the income tax burden has substantially shifted onto the wealthy. The percentage of federal income taxes paid by those who make more than $200,000 a year has actually risen from 41% to 47% in recent years.

In other words, the richest 3 out of 100 Americans are now paying close to the same amount in income taxes as the other 97% of workers combined.

It's also a common myth that the rich are hording all the wealth, while the middle class stays stuck in economic quicksand.

The IRS data show that the share of all income earned by the wealthiest 10% of Americans has actually fallen since 2001. The rich are earning less of the total income but paying more of the total taxes.

During this economic expansion, the middle class is growing and becoming more prosperous. About 4 out of 10 Americans now make more than $50,000 a year -- that's up from 3 out of 10 in 1990.

There's more good news. Tax revenues over the past two years are up more than half a trillion dollars — the largest two-year increase in tax collections in history.

Bush cut the capital gains and dividend taxes, but guess what? Now those tax receipts are through the roof in the last two years.

It's called the Laffer Curve: a lower tax rate has increased economic growth and investment and thus the government gets more tax revenues.

The Bush tax cuts have pumped steroids into the US economy and created 5 million new jobs, a surge in new business investment and record worker productivity.

Those are the reasons to make the tax cuts permanent. But for those who really want to sock it to the rich, the Bush tax cuts have done that too.

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Bush Tax Cuts