February 02, 2006

Tax breaks for the wealthy

From Gene Gerard in ZNet:

On January 1 Congress allowed two tax breaks that benefit the wealthy to become effective. The cuts eliminated current provisions of the tax code that limits the amount of personal exemptions and itemized deductions that Americans with high incomes can take. Over the course of the next five years the tax cuts will cost approximately $27 billion, according to a study by the Center on Budget and Policy Priorities. Ironically, Republicans in Congress, only two weeks before the cuts took effect, voted to reduce domestic spending on programs affecting the poor and the middle class by $39 billion over the next five years.

The tax codes eliminated are the Pease provision and the personal exemption phase-out provision (PEP). Both were originally passed in 1990 in an effort to reduce the deficit. The Pease provision limited the amount of itemized deductions taxpayers with high incomes could claim. The tax code permits individuals to reduce their taxable income either by the standard deduction or by an amount equivalent to their total itemized deductions. In general, wealthy taxpayers use itemized deductions much more than the middle class and the poor.

The Pease provision reduced the amount of deductions for those who itemized and had incomes exceeding $145,950 last year. The total amount of itemized deductions wealthy taxpayers could claim was reduced by three percent of the amount by which their incomes exceeded $145,950. Similarly, the PEP provision of the tax code phased out personal exemptions for the wealthy. The tax code permits individuals to claim a personal exemption for each member of their household; last year it was $3,200.00.

They can subtract personal exemptions from their adjusted gross income before calculating their taxes, thereby reducing the amount of taxes owed. In 2005 the PEP provision mandated that taxpayers lost two percent of their personal exemption for every $2,500.00 by which their income exceeded $218,950 for married couples and $145,950 for singles.

Congressional Republicans have frequently said that the Pease and PEP provisions made it more difficult for Americans to determine their taxes. However, it's typically high-income taxpayers who take itemized deductions. And these are individuals who usually have their taxes prepared by accountants and other tax professionals who can easily calculate these provisions.

The Joint Committee on Taxation has estimated that over the next 13 years these tax breaks for the wealthy will deprive the country of $197 billion in revenue. And a study by the Brookings Institution determined that 97 percent of the Pease and PEP tax breaks will go to those households with incomes above $200,000. And more than half of these breaks will benefit the 0.2 percent of families with annual incomes exceeding $1 million. Once these tax cuts are fully implemented in 2010, the average millionaire will save $19,000 annually in taxes.

Only three percent of families with annual incomes of less than $200,000 will receive any benefit from these tax breaks. Families with yearly incomes between $100,000 and $200,000 will receive an average tax cut of only $25. And families earning less than $100,000 - the vast majority of Americans - will not benefit at all.

Shortly before these tax cuts became effective Republicans in Congress approved of massive and draconian domestic budget cuts, despite objections by Democrats. Republicans insisted that "tough choices" had to be made in an effort to reduce the growing deficit. Consequently, they voted to cut $11 billion over the next five years from Medicaid, the health care system that serves America's poor. Substantial reductions were also made in childcare assistance, which will result in 255,000 fewer children living in poverty receiving federal assistance.

Republicans voted to cut funding for child support enforcement programs by $1.5 billion over the next five years. These funds are used to locate parents who have failed to pay child support and collect delinquent payments on their child's behalf. According to the Congressional Budget Office, this loss of federal funding will result in $2.9 billion in child support going uncollected in the next five years.

Other cuts were equally severe. Congressional Republicans agreed to cut $343 million in funding for foster care programs, including reductions that will make it more difficult for grandparents who are raising their grandchildren to receive assistance. Over $12 billion was cut from federal college loan programs, making it more difficult for poor and middle-class Americans to afford a college education.

If Republicans had chosen not to allow the Pease and PEP tax cuts to take effect this would have saved more than two-thirds of the funding cut from domestic programs. In fact, over the next five years these tax breaks exceed the savings from all of the reductions in low-income assistance programs that Congress voted to cut. It appears that for Congressional Republicans, "tough choices" in reducing the deficit didn't include requiring the wealthy to continue to pay their fair share of taxes.




"I myself have never been able to find out precisely what feminism is: I only know that people call me a feminist whenever I express sentiments that differentiate me from a door mat or a prostitute." ~ Rebecca West

Reference
Recommended Sites
Quotations
"Probably, hanging onto the past brings more destruction than any other single cause. ...It's the Muslim fundamentalists who worship the past and ignore the reformist spirit with which Muhammad viewed women. It's the backward-looking Christian literalists who interpret religious teachings in a way that consolidates their power..." ~ Gloria Steinem

"'Inherent differences' between men and women, we have come to appreciate, remain cause for celebration, but not for denigration of the members of either sex or for artificial constraints on an individual's opportunity." ~ Ruth Bader Ginsberg

"As a woman, I have no country. As a woman, my country is the world." ~ Virginia Woolf

"...remember the ladies and be more generous and favorable to them than your ancestors... If particular care and attention is not paid to the ladies, we are determined to foment a rebellion, and will not hold ourselves bound by any laws in which we have no voice or representation." ~ Abigail Adams

"Bloody treason, murderous act
Not by women were designed.
Bells o'erthrown nor churches sacked
Speak not ill of womenkind."
~ Gearoid Iarla Fitzgerald

"Too often the great decisions are originated and given form in bodies made up wholly of men, or so completely dominated by them that whatever of special value women have to offer is shunted aside without expression." ~ Eleanor Roosevelt

"If we are to achieve a richer culture, rich in contrasting values, we must recognize the whole gamut of human potentialities, and so weave a less arbitrary social fabric, one in which each diverse gift will find a fitting place." ~ Margaret Mead

"Of my two 'handicaps' being female put more obstacles in my path than being black." ~ Shirley Chisholm

"Sometimes, I feel discriminated against, but it does not make me angry. It merely astonishes me. How can any deny themselves the pleasure of my company?" ~ Zora Neale Hurston

"Eventually, all things merge into one; and a river runs through it. The river was cut by the world's great flood and runs over rocks from the basement of time. On some of the rocks are timeless raindrops. Under the rocks are the words, and some of the words are theirs..." ~ Norman Maclean

"There was a strange stillness. The birds, for example - where had they gone?... It was a spring without voices." ~ Rachel Carson

"If you have men who will exclude any of God's creatures from the shelter of compassion and pity, you will have men who will deal likewise with their fellow men." ~ St. Francis of Assisi

"I have from an early age abjured the use of meat, and the time will come when men such as I will look upon the murder of animals as they now look on the murder of men." ~ Leonardo Da Vinci

"God has cared for these trees, saved them from drought, disease, avalanches, and a thousand straining, leveling tempests and floods; but He cannot save them from fools." ~ John Muir

"How quickly nature falls into revolt when gold becomes her object!" ~ William Shakespeare

"The idea of wilderness needs no defense, it only needs defenders." ~ Edward Abbey

"We could never have loved the earth so well if we had had no childhood in it... Our delight in the sunshine on the deep-bladed grass to-day might be no more than the faint perception of wearied souls, if it were not for the sunshine and the grass in the far-off years which still live in us, and transform our perception into love." ~ George Eliot (Marian Evans)

"When one tugs at a single thing in nature, he finds it attached to the rest of the world." ~ John Muir

"The will of the people is the only legitimate foundation of any government, and to protect its free expression should be our first object." ~ Thomas Jefferson

"A nation that is afraid to let its people judge the truth and falsehood of ideas in an open market is a nation that is afraid of its people." ~ John F. Kennedy

"I believe there are more instances of the abridgement of the freedom of the people by gradual and silent encroachments of those in power than by violent and sudden usurpations." ~ James Madison

"When you think of the long and gloomy history of man, you will find more hideous crimes have been committed in the name of obedience than have ever been committed in the name of rebellion." ~ C. P. Snow

"Unthinking respect for authority is the greatest enemy of truth." ~ Albert Einstein

"Necessity is the plea of every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves." ~ William Pitt

"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety." ~ Benjamin Franklin

"Rules are not necessarily sacred, principles are." ~ Franklin D. Roosevelt

"If somebody tells you you ought to quit, it's because they're afraid you won't." ~ Bill Clinton

"Each time a man stands up for an ideal, or acts to improve the lot of others, or strikes out against injustice, he sends forth a tiny ripple of hope, and crossing each other from a million different centers of energy and daring, those ripples build a current which can sweep down the mightiest walls of oppression and resistance." ~ Robert F. Kennedy

"It is only with the heart that one can see rightly; what is essential is invisible to the eye." ~ Antoine de Saint-Exupery

"The first question which the priest and the Levite asked was: If I stop to help this man, what will happen to me? But the good Samaritan reversed the question: If I do not stop to help this man, what will happen to him?" ~ Martin Luther King Jr.

"No matter how big a nation is, it is no stronger than its weakest people, and as long as you keep a person down, some part of you has to be down there to hold him down, so it means you cannot soar as you might otherwise." ~ Marian Anderson

"We can have democracy in this country or we can have great wealth in a few hands, but we can't have both." ~ Louis Brandeis

"The good we secure for ourselves is precarious and uncertain until it is secured for all of us and incorporated into our common life." ~ Jane Addams

"The liberty of a democracy is not safe if the people tolerate the growth of private power to a point where it becomes stronger than their democratic State itself." ~ Franklin D. Roosevelt

"O, it is excellent to have a giant's strength; But it is tyrannous to use it like a giant." ~ William Shakespeare

"I hope our wisdom will grow with our power, and teach us, that the less we use our power the greater it will be." ~ Thomas Jefferson

"The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy. Instead of diminishing evil, it multiplies it." ~ Martin Luther King Jr.

"When men talk about defense, they always claim to be protecting women and children, but they never ask the women and children what they think." ~ Patricia Schroeder

"I hate war as only a soldier who has lived it can, only as one who has seen its brutality, its futility, its stupidity." ~ Dwight D. Eisenhower

"What difference does it make to the dead whether the mad destruction is wrought under the name of totalitarianism or the holy name of liberty and democracy?" ~ Mohandas Gandhi

"One is left with the horrible feeling now that war settles nothing; that to win a war is as disastrous as to lose one." ~ Agatha Christie

"Mankind must put an end to war, or war will put an end to mankind... War will exist until that distant day when the conscientious objector enjoys the same reputation and prestige that the warrior does today." ~ John F. Kennedy

"Blessed are the peacemakers: for they shall be called the children of God." ~ Jesus

"Every gun that is fired, every warship launched, every rocket fired, signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. The world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children." ~ Dwight D. Eisenhower

"When will our consciences grow so tender that we will act to prevent human misery rather than avenge it?" ~ Eleanor Roosevelt

"And thus I clothe my naked villany with odd old ends stol'n forth of holy writ, and seem a saint when most I play the devil." ~ William Shakespeare

"And when thou prayest, thou shalt not be as the hypocrites are: for they love to pray standing... in the corners of the streets, that they may be seen of men... But thou, when thou prayest, enter into thy closet, and when thou hast shut thy door, pray to thy Father which is in secret..." ~ Jesus

"Believing with you that religion is a matter which lies solely between man & his god, ... legislature should make no law respecting an establishment of religion, or prohibiting the free exercise thereof, thus building a wall of separation between church and state." ~ Thomas Jefferson

"Persecution is not an original feature in any religion, but it is always the strongly marked feature of all religions established by law." ~ Thomas Paine

"Heroism on command, senseless violence, and all the loathsome nonsense that goes by the name of patriotism - how passionately I hate them!" ~ Albert Einstein

"True patriotism hates injustice in its own land more than anywhere else." ~ Clarence Darrow

"When a whole nation is roaring Patriotism at the top of its voice, I am fain to explore the cleanness of its hands and purity of its heart." ~ Ralph Waldo Emerson

"Guard against the impostures of pretended patriotism." ~ George Washington

"The nationalist not only does not disapprove of atrocities committed by his own side, he has a remarkable capacity for not even hearing about them." ~ George Orwell

"To (say) that we are to stand by the president right or wrong is not only unpatriotic and servile, but it's morally treasonable to the American public." ~ Theodore Roosevelt

"In America, anybody can be president. That's one of the risks you take." ~ Adlai Stevenson

"On some great and glorious day the plain folks of the land will reach their heart's desire at last and the White House will be adorned by a downright moron." ~ H.L. Mencken

"Conservatives are not necessarily stupid, but most stupid people are conservatives." ~ John Stuart Mill

"I don't give 'em hell. I just tell the truth, and they think it's hell." ~ Harry Truman

"I'm not a member of any organized political party, I'm a Democrat!" ~ Will Rogers

"I never was surer of my position that no self-respecting woman should wish or work for the success of a party that ignores her political rights." ~ Susan B. Anthony
About
Democratic Wings is dedicated to Gloria Steinem, whose courage, wisdom, and selfless devotion to the cause of equality for women has inspired us to believe in ourselves and to believe in our dreams.

This is a not for profit site that is not affiliated with any organization. Fair Use Notice.

Contact: blogmail at democraticwings dot com

© 2003-2008 DemocraticWings.com

Made on a Mac 

Syndicate this site 


Evolve