Comments on: Obama’s Payroll Tax Increase Affects Earners, Not ‘Wealthy’; Media Clueless

By: dscott

dscott — Fri, 20 Jun 2008 20:36:20 +0000

Ah!, I just realized something. Since the Bush tax cuts primarily benefited those “taxpayers” making less than $100k and the Yuppies got the AMT instead (i.e. they got a tax increase) the tax receipts increased by one trillion a year. There are far more who earn less than $100k than there are in the doughnut hole. This increase in receipts is a testament to the recycling of the dollar within the economy from the middle class. Every dollar that is spent in the US economy is recycled at least 5 or 6 times a year, maybe you have a more accurate figure. Thus the best explanation for the success of the Bush tax cut is that it was spread amongst a large group of individuals who would spend the tax savings and that tax savings was essentially multiplied by the recycle rate. Hence tax revenue went up because there was more money recycled in the economy which could be taxed.

By: dscott

dscott — Fri, 20 Jun 2008 19:39:44 +0000

I think this is a prime opportunity to make accusations of foul play with Obama, he has no real explanation for creating a doughnut hole other than the usual diversion of the tax the rich meme. As you say, the rich will respond by changing their income stream to be unearned income to avoid the new cut off as they have always done, so in essence there will be no extra income into the SS trust fund. This is just a gimmick to claim he did something when in fact he did nothing at all.

In fact, isn’t Obama in favor of immediately eliminating the Bush tax cuts and eliminating the AMT at the same time??? IF so, we have him on quid pro quo in an election year fraud scheme.

By: TBlumer

TBlumer — Fri, 20 Jun 2008 19:22:53 +0000

#1, I do believe what you’re talking about is an element of the thought process.

By: dscott

dscott — Fri, 20 Jun 2008 19:03:35 +0000

I seem to remember that the bulk of well off Dem supporters fall in the doughnut hole of 100k to 250k. It was referenced by TNR when talking about the AMT a year ago. They took down the page. I believe this is why Obama didn’t want to subject his core group of monied supporters to the confiscation of the SS payroll tax. Also note that the AMT sucked in much of this particular group because of the Bush tax cuts. This is why they rail against Bush because not only didn’t they get the benefit of the tax cut, they instead got wacked with the AMT. Remember Rangle attempting to get rid of the AMT in favor of cancelling the Bush tax cut???