Democrats, in a stark shift in messaging, to make big tax-break pitch for middle class

[applegrove]

Democrats, in a stark shift in messaging, to make big tax-break pitch for middle class

By Lori Montgomery and Paul Kane at the Washington Post

http://www.washingtonpost.com/business/economy/democrats-in-a-stark-shift-in-messaging-to-make-big-tax-break-pitch-for-middle-class/2015/01/11/d4438468-9999-11e4-a7ee-526210d665b4_story.html

SNIP.....................


Senior Democrats, dissatisfied with the party’s tepid prescriptions for combating income inequality, are drafting an “action plan” that calls for a massive transfer of wealth from the super-rich and Wall Street traders to the heart of the middle class.

The centerpiece of the proposal, set to be unveiled Monday by Rep. Chris Van Hollen (D-Md.), is a “paycheck bonus credit” that would shave $2,000 a year off the tax bills of couples earning less than $200,000. Other provisions would nearly triple the tax credit for child care and reward people who save at least $500 a year.

The windfall — about $1.2 trillion over a decade — would come directly from the pockets of Wall Street “high rollers” through a new fee on financial transactions, and from the top 1 percent of earners, who would lose billions of dollars in lucrative tax breaks.

The plan also would use the tax code to prod employers to boost wages, which have been stagnant for four decades despite gains in productivity and profits.



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[bluestateguy]

1. Democrats can never win a taxcut bidding war with Republicans

And by trying to do so they are legitimizing a discredited argument that taxcuts create jobs and prosperity.

Oh, and of course there are more goodies for parents with children. If you don't have kids, or you aren't a senior citizen, politicians could give three shits about you.

[MannyGoldstein]

2. 50 years ago, middle-class Americans had half the tax rate they do now

While the wealthiest paid three times the rate they do today.

That worked very, very well.

It might be good to return to that setup.

[YoungDemCA]

3. Define "middle-class"

It's a seriously broad, nebulous and murky term. Especially in this country.

[MannyGoldstein]

4. Median. nt

[Trillo]

12. I've read that when income taxes were first applied,

taxes only applied to the very wealthy.

[Amishman]

14. except the rich never paid their full tax burden

back in the 50s when the top tax rate was 91%, there were even more loopholes. I believe I have read that the real effective tax rate was in the 30% range for top earners.

The loopholes themselves may change, but the tax code has always been swiss cheese.

[ND-Dem]

15. actually i once read an analysis of this point based on income tax records which came to

a different conclusion. It went something like this:

Americans making over $250,000 in 1944 — over $3.2 million today — paid 69 percent of their total incomes in federal income taxes, after exploiting every loophole they could find. In 2007, by contrast, America’s 400 highest earners paid just 18.1 percent of their total incomes, after loopholes, in federal taxes.

http://flaglerlive.com/26685/gc-fdr-and-taxes/

[Warpy]

5. That will do nothing since there is so little of a middle class left

and everybody else needs a rise in wages before any tax cut might be meaningful.

Van Hollen has been inside the beltway too long. He has absolutely no idea what the problems really are out here in the rest of the country. He has no clue that the middle class has been forced down into being barely working class and that taxes are already low, except for regressive taxes like sales taxes.

Any proposal that doesn't begin with a steep rise in the minimum wage is not a proposal worth supporting.

[Recursion]

6. 20% of the country earns between 40K and 60K (per household)

Two thirds of them own their house (that's unimaginable to me, but I know it's more common outside of where I've lived).

Those people, and maybe a chunk from the quintile on either side, are definitely "middle class" by most people's definitions.

[Warpy]

7. Not the historical definition, which takes at least twice that income

Households in that range are living paycheck to paycheck. A serious illness, a car wreck, loss of employment, all can lead to losing everything at $40,000-60,000 gross family income.

One of the things that defined a true middle class was a cushion of savings, either cash or investments, that could be tapped to get through a crisis. People in the $40,000-60,000 household income bracket have minimal savings, especially if they have college debt. There is no way they can save for retirement, a rainy day, or anything else.

The middle class could have. People now are working class, although their parents are shocked by the dollar amount they are making. Indexing it to inflation shows that people in the former middle class have lost ground while everybody else has lost ground in purchasing power right along with them.

And don't play the quintile game. That is no longer an effective measure of anything since so much wealth has been vacuumed out of the economy by that 0.1%. The only way that third quintile is the middle of anything is in their raw numbers of people--not in income, not in prospects, and certainly not in purchasing power.

Until and unless wages rise by a considerable amount, this economy will remain in the doldrums as purchasing power continues to erode year after year.

[freshwest]

8. I love this paragraph from the OP. Think what this really means...

...Senior Democrats, dissatisfied with the party’s tepid prescriptions for combating income inequality, are drafting an “action plan” that calls for...

a massive transfer of wealth from the super-rich and Wall Street traders to the heart of the middle class...

That'll make the whole GOP (R - Koch stooges) implode. Obama is going to veto their pipeline, their personhood bill, etc. and they couldn't repeal Dodd-Frank.

Now they can't protect their Wall Street pals either. And the stinking austerity they want to pull on SS is going to take a hit as people do better and have more money to use, increasing revenues in the states and through business, and the taxes on transactions.

M$M is going to have a fit - watch for it. Their EPIC FAIL has been a long time coming. They'll be drowning in tears.



EOM.

[Spacemom]

9. it's been so long since anything has been done for the middle class

I first checked to see if the article was The Onion.

[bemildred]

10. So it's finally dawned on them that they can win power with votes? nt

[Scuba]

11. Just curious, but why didn't they propose this when they controlled Congress?

Fucking window dressing.

[annabanana]

13. My thought too. Safe for corpodems to get all populist now. . . . . n/t

[Kermitt Gribble]

16. +1 n/t

[leftstreet]

17. +1