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Thursday, September 30, 2010

Bush Tax Cuts Grew Poverty And Future Debt Certainty

In yet another measure of the accumulative effects the Bush Tax cuts have had on Wisconsin, household income fell and poverty rose in the state between 2008 and 2009, according to U.S. Census Bureau figures released Tuesday. Many economists had long felt the Bush tax cuts would spur economic development and job growth. Still in effect seven years later - where's the beef?

Census: Gap between rich and poor is at widest.

The census also found that the top-earning 20% of Americans (those making $100,000 each year) received 49.4% of all income generated in the U.S., compared with the 3.4% earned by those below the poverty line.

Remember when Treasury Secretary Paul O'Neill spoke out against the tax cuts for the rich? (June 14, 2006)

Link Excerpt

“Cheney, at this moment, shows his hand,” says Suskind. “He says, ‘You know, Paul (O'Neill), Reagan proved that deficits don't matter. We won the mid-term elections, this is our due.’ … O'Neill is speechless.”

”It was not just about not wanting the tax cut. It was about how to use the nation's resources to improve the condition of our society,” says O’Neill. “And I thought the weight of working on Social Security and fundamental tax reform was a lot more important than a tax reduction.”

Did he think it was irresponsible? “Well, it's for sure not what I would have done,” says O’Neill.

He says everyone expected Mr. Bush to rubber stamp the plan under discussion: a big new tax cut. But, according to Suskind, the president was perhaps having second thoughts about cutting taxes again, and was uncharacteristically engaged.

“He asks, ‘Haven't we already given money to rich people? This second tax cut's gonna do it again,’” says Suskind.

“He says, ‘Didn’t we already, why are we doing it again?’ Now, his advisers, they say, ‘Well Mr. President, the upper class, they're the entrepreneurs. That's the standard response.’ And the president kind of goes, ‘OK.’ That's their response. And then, he comes back to it again. ‘Well, shouldn't we be giving money to the middle, won't people be able to say, ‘You did it once, and then you did it twice, and what was it good for?’"

But according to the transcript, White House political advisor Karl Rove jumped in.

“Karl Rove is saying to the president, a kind of mantra. ‘Stick to principle. Stick to principle.’ He says it over and over again,” says Suskind. “Don’t waver.”

In the end, the president didn't. And nine days after that meeting in which O'Neill made it clear he could not publicly support another tax cut, the vice president called and asked him to resign.

With the deficit now climbing towards $400 billion, O'Neill maintains he was in the right. * * *


Democurmudgeon said...

It was great to pull out the Paul O'Neil excerpt. It's puts the whole tax cut idea in perspective. Cheney's "this is our due," says it all for me.

While the rest of us are criticized for depending on "entitlements," the wealthy are "due" greater wealth. Amazing.

Lou Kaye said...

Thanks for that. Today's posting is extra fitting after reading that George W. Bush and wife Laura are holding a speaking engagement today with uber-rich ABC Supply in nearby Beloit.

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