Tuesday, September 21, 2010

Once Again, Robert Reich Gets It Right, This Time On Taxes

Who deserves a tax cut more: the top 2 percent -- whose wages and benefits are higher than ever, and among whose ranks are the CEOs and Wall Street mavens whose antics have sliced jobs and wages and nearly destroyed the American economy -- or the rest of us?

Not a bad issue for Democrats to run on this fall, or in 2012.

Republicans are hell bent on demanding an extension of the Bush tax cut for their patrons at the top, or else they'll pull the plug on tax cuts for the middle class. This is a gift for the Democrats.

Reich goes on to point out two things: first, why this is sound economics... the wealthy, unlike ordinary middle- and lower-class folk and others who depend on a job for a living, don't tend to spend the money they obtain from tax cuts, and hence do not contribute to the much-needed stimulus... and second, why Democrats must do this right now, not after Election Day. That should be obvious: it'll never happen after elections. But so many Dems are claiming extenuating circumstances in their own re-election races in conservative districts that they could well vote with the GOP to sustain the Bush tax cuts for the obscenely wealthy.

As to the voting public, according to a Pew survey, their former belief that they're going to be rich someday is changing (.pdf) ...

The survey also finds that the recession has led to a new frugality in Americans‘ spending and borrowing habits; a diminished set of expectations about their retirements and their children‘s future; and a concern that it will take several years, at a minimum, for their family finances and house values to recover.
... but possibly there's still a vestige of that "things are gonna get better" mentality, that sense that their wealth will increase with time despite the economic downturn:

Not all survey findings are bleak. More than six-in-ten (62%) Americans believe that their personal finances will improve in the coming year, and a small but growing minority (15%) now says the national economy is in good shape.
So Americans continue to vote for pols who promise them pie in the sky in the sweet bye 'n' bye... who in turn support retaining tax cuts for the wealthy. If only voters were more pessimistic...

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