Congressional Republicans Still Pandering to Those Who Need Help the Least

In the 1990s, the wealthy did very well without any tax cuts. So Bush and his Republican friends in Congress have once again applied their peculiar brand of logic to the problems of the wealthy. Former Clinton adviser, Robert Reich briefly explores the strange universe of Republican economics in the American Prospect:

Here we are six months before a mid-term election, with polls showing only about 20 percent of the American public approving the job Congress is doing. Small wonder. The federal budget deficit is still out of control. We’ve got a war going on that’s not going well, and the military is spending over a half a trillion dollars a year. Meanwhile, public services are being slashed. So what’s Congress about to give us? A $70 billion tax cut.

(snip)

...It turns out a whopping 87 percent of the benefits of this tax cut will go to the 14 percent of American households earning above $100,000 a year. Twenty-two percent of the benefits will go to the richest two-tenths of one percent of American households earning more than a million dollars a year.

(snip)

What is the public need? Some administration apologists, including the editorial page of the Wall Street Journal, claim repeatedly that the rich are paying a larger-than-ever share of income taxes, so it’s entirely fitting that they get the lion’s share of any tax cut. This logic conveniently leaves out two facts. First, the rich are now paying a smaller percentage of their income in taxes than at any time in the last seventy-five years. That they pay a lot of taxes nonetheless is a by-product of the mind-boggling increase in their income and wealth relative to most other Americans.

Second, if you consider not just income and capital-gains taxes but all the taxes people pay -- including payroll taxes and sales taxes -- you find that middle-income workers are now paying a larger share of their incomes than people at or near the top. We have turned the principle of a graduated, progressive tax on its head.

A second justification given by the White House and the Journal for continuing to cut taxes on the wealthy is that the wealthy invest their extra money in the economy, and that extra investment trickles down to everyone else. The inconvenient missing fact here is the recent real-world impact of such supply-side economic theory. To date, the administration’s capital gains and dividend tax cuts have not reaped what their proponents promised. The rate of new investment during this recovery has trailed the rate of investment during the three previous recoveries.

President Bush is borrowing money from America's children to cover up his own incompetence. And the Republican Party is going along with the charade. When I see very young children, I wonder what it's going to be like for them in the coming years. But one thing is for certain: the children of the 21st century deserve better.