Daniel Indiviglio of The Atlantic gives us 6 Reasons to Temporarily Extend the Bush Tax Cuts to the Rich:
- Raising the Deficit a Little Won’t Scare the Market
- The Rich Are the Only Ones Spending
- Credit and Investment Will Benefit
- Last Chance for Stimulus
- No Better Alternative for the $70 Billion
- Not Worth the Risk of Double Dip
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3 responses so far ↓
1 Knox Marlow // Aug 9, 2010 at 6:59 pm
This article is fundamentally flawed. The author discusses whether to let the Bush tax cuts expire with respect to “the rich.” He lives in the same world as Nancy Folbre. See link for blog post and lively comments:
http://blog.pappastax.com/index.php/2010/08/02/smoke-and-fog-another-saintly-pro-taxer-accuses-anti-taxers-of-lying/
The Obama administration wants to end the tax cuts for “the rich.” Folbre defines the “very rich” as households in the top 2% of U.S. taxpayers. Indiviglio lends some credibility to their arguments by failing to challenge their flawed labels.
As Robert commented on August 3, one of the primary flaws in any argument about “the rich” (or the “very rich”) is definitional. We should not conflate income with wealth. The top 2% of individual taxpayers includes households with pre-tax income of approximately $225k. A family that earns $225k in a high-cost metropolitan area should not be lumped in with Bill Gates or Warren Buffett. If we’re going to talk about “the rich,” we need to define the income distribution and then start the discussion.
The reason Obama, Folbre and others need to define the “rich” (“super rich”) by reference to income (“top 2% of incomes”) involves simple math. Let’s say the “working affluent” are households in the top 2% through the top 0.5% of income earners. The number of “working affluent” vastly exceeds the number of “super rich.” If Congress and the Administration doesn’t increase taxes on the “working affluent,” Congress and the Administration doesn’t raise material revenue. (Similarly, a small tax increase on the working class would have a bigger revenue effect than a big tax increase on the “super rich.”)
We need people to start challenging the flawed definitions that have been served up by the current Administration (and adopted into law by Congress).
2 Peter // Aug 10, 2010 at 8:49 am
Knox,
Excellent. I agree.
3 7 of 10 Economists Say Extend All Bush Tax Cuts // Sep 4, 2010 at 9:53 am
[...] The Atlantic: 6 Reasons to Extend the Bush Tax Cuts [...]
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