Surprise! Taxes Will Actually Go Up for the Poor
But for the rich, it's a great deal
By Kevin Spak, Newser User
Posted Dec 8, 2010 7:43 AM CST
The poor will find they have less money in their pockets.   (Shutterstock)

(Newser) – This tax cut deal President Obama struck with Republicans is awesome—as long as you’re among the wealthiest Americans. At least a quarter of the tax savings will go to the top 1%, the New York Times points out, in a piece headlined “Tax Package Will Aid Nearly All.” Oh? Who’s not included in that “nearly all?” Why, the working poor, of course!

For individuals making less than $20,000 a year, or families making less than $40,000, taxes will actually increase, because their payroll tax savings will be less than what they lose out on from the expiring Making Work Pay tax credit. “It will only be a few dollars a week,” says an analyst from the nonpartisan Tax Policy Center, “but it is an increase.” Or, as another analyst put it, "It's going to look like the rich are getting richer again."

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Showing 3 of 158 comments
Dec 8, 2010 10:15 PM CST
Every single wealthy individual, ever, in the world, is wealthy because at some point in the chain, other people paid them for something. Even if you find an oil well or gold mine, you get money because that is worth something to someone. I own a small business, there is still a lot of work to be done before it is my full time job, before I have employees, before I earn $250,000 per year. But my customers are also people who earn less than $250,000, people who earn their money from someone else. And, should I ever need to employ someone, it will be because I have increased demand and not enough production capability, not just because I feel like paying someone. You aren't going to create incentive for people to create jobs by letting them keep a few thousand dollars. You will create that incentive by providing them with customers, and there is probably a 97% chance those customers won't be in the top earning brackets. Now, I know, that in my industry, if more regular, everyday, blue collar workers saw that they could invest and spend more confidently, that they knew where their next meal was coming from, they would have more money to spend. So, I just don't see where you conservatives get it. I know that you could create a couple thousand jobs by lowering business taxes, but you could create hundreds of thousands of jobs by giving incentive to 98% of US citizens to buy things, and then THAT will be bolstered by MORE US citizens having jobs, and so on and so on.
Harriet Atkinson
Dec 8, 2010 1:06 PM CST
This is why people don't know what is going on - people parsing truths to confuse the unknowing! The inadvertent increase for persons making $20 to $40K annually is neglible because of earned income tax credits and tax rates for lower income with multiple deductions. Options on the table prevented a win-win for everyone, but most people at those tax rates have alternatives to taxable income that will offset any increase.
Dec 8, 2010 12:47 PM CST
Why do I keep falling for these useless discussions? I already know that the fallacies of politics will not solve our current dilema. The truth is, we are all inside the same boat. Contrary to popular belief and as much as they would like to think so, the rich cannot escape what is to come if things don't change. If we sink, we're all sinking together and if we survive, we'll all survive together. We cannot go back, and we cannot remain in neutral for long. To borrow a line from The Matrix, we are left with "A world where anything is possible. Where we go from there is a choice I leave to you".