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Forum Post: Bipartisan Senate deficit deal to cut Medicare, slash taxes for the wealthy

Posted 5 years ago on Oct. 16, 2012, 12:54 p.m. EST by OldCrow (22)
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The push for a post-election budget agreement is taking place against the backdrop of the so-called “fiscal cliff,” a series of measures due to be enacted on January 1, 2013 should Congress fail to pass a deficit-reduction plan by the end of the year… The prospect of these spending cuts and tax increases taking effect at the New Year is being used to create a crisis atmosphere which the Democrats and Republicans and the media will use to justify an intensification of attacks on the living standards of the...[middle] class.

Bipartisan Senate deficit deal to cut Medicare, slash taxes for the wealthy

By Bryan Dyne and Barry Grey 
 12 October 2012

A speech given Tuesday to the National Press Club by Charles Schumer, Democratic senator from New York, sheds further light on the anti-working class character of a federal deficit-cutting deal being worked out in secret, with the backing of the Obama administration, by a group of four Democratic and four Republican senators.

The discussions by the so-called “Gang of Eight” underscore the undemocratic character of the elections. Behind closed doors, with the support of the leadership of both big business parties, plans are being laid to impose unprecedented cuts in basic social programs such as Medicare, Medicaid, Social Security and food stamps, along with further tax cuts for corporations and the wealthy. The aim is to reach an agreement that will be passed after the elections by the so-called “lame duck” Congress (whose term will expire at the beginning of January) for austerity measures and tax cuts for the rich. These measures are not being discussed by either presidential candidate or either party in the election campaign. They are to be put in place regardless which party controls the White House and Congress, with the electorate denied any opportunity in the elections to express its attitude to them. Schumer is not part of the “Gang of Eight,” but as the third-ranking Democrat in the Senate, a member of the Senate Finance Committee, and one of Congress’ biggest recipients of campaign funds from Wall Street, he has intimate knowledge of the group’s discussions. In his speech, he made clear that the Democratic Party has agreed to major cuts in basic entitlement programs such as Medicare and that the budget plan currently being worked out includes cuts in both corporate tax rates and personal income tax rates for the wealthy…




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[-] 1 points by armaniwatches (1) 5 years ago

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[-] 1 points by ThomasKent (131) 5 years ago

That’s a bad idea.

The tax cuts mania that Reagan started was an experiment in trickle-down economics that failed miserably. What happened allowed enough money to be hoarded by the upper income tax brackets that they were able to capture the regulatory, legislative, executive, and judicial branches of our government.

A progressive tax is a tax by which the tax rate increases as the taxable base amount increases. "Progressive" describes a distribution effect on income or expenditure, referring to the way the rate progresses from low to high, where the average tax rate is less than the marginal tax rate. It can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime. Progressive taxes attempt to reduce the tax incidence of people with a lower ability-to-pay, as they shift the incidence increasingly to those with a higher ability-to-pay.

Wiki progressive tax


Definition of 'Progressive Tax' A tax that takes a larger percentage from the income of high-income earners than it does from low-income individuals. The United States income tax is considered progressive: in 2010, individuals who earned up to $8,375 fell into the 10% tax bracket, while individuals earning $373,650 or more fell into the 35% tax bracket. Basically, taxpayers are broken down into categories based on taxable income; the more one earns, the more taxes they will have to pay once they cross the benchmark cut-off points between the different tax bracket levels.

Investopedia progressive tax


During the 1800s economic thinking in the United States usually conformed to the founders’ guiding principles of uniformity and equal protection. One exception was during the Civil War, when a progressive income tax was first enacted. Interestingly, the tax had a maximum rate of 10 percent, and it was repealed in 1872. As Representative Justin Morrill of Vermont observed, “in this country we neither create nor tolerate any distinction of rank, race, or color, and should not tolerate anything else than entire equality in our taxes.”

When Congress passed another income tax in 1894—one that only hit the top 2 percent of wealth holders—the Supreme Court declared it unconstitutional. Stephen Field, a veteran of 30 years on the Court, was outraged that Congress would pass a bill to tax a small voting bloc and exempt the larger group of voters. At age 77, Field not only repudiated Congress’s actions, he also penned a prophecy. A small progressive tax, he predicted, “will be but the stepping stone to others, larger and more sweeping, till our political contests will become a war of the poor against the rich.”

In 1913, almost 20 years later, the ideas of uniform taxation and equal protection of the law for all citizens were overturned when a constitutional amendment permitting a progressive income tax was ratified. Congress first set the top rate at a mere 7 percent—and married couples were only taxed on income over $4,000 (equivalent to $80,000 today). During the tax debate, William Shelton, a Georgian, supported the income tax “because none of us here have $4,000 incomes, and somebody else will have to pay the tax.” As Madison and Field had feared, the seeds of class warfare were sown in the strategy of different rates for different incomes.

It took the politicians less than one generation to hike the tax rates and fulfill Field’s prophecy. Herbert Hoover and Franklin Roosevelt, using the excuses of depression and war, permanently enlarged the income tax. Under Hoover, the top rate was hiked from 24 to 63 percent. Under Roosevelt, the top rate was again raised—first to 79 percent and later to 90 percent. In 1941, in fact, Roosevelt proposed a 99.5 percent marginal rate on all incomes over $100,000. “Why not?” he said when an adviser questioned him.

Progressive Income Tax in US History


History has shown us that trickle-down economics doesn’t work. The progressive tax keeps money in circulation by redistribution to the greater economy instead of being hoarded by narrower interests to the detriment of the overall economy as Reaganomics and GW Bushonomics have demonstrated. We are in the greatest recession, middle class incomes have been stagnant for 30 years, official unemployment hovers near 8%, but is actually claimed to be much higher. The government is far better equipped to manage the national economy than the aggregate of individuals who depend largely on investment bankers to manage their finances.

Max Keiser Vampire Banker Hunter part 1


Max Keiser Vampire Banker Hunter part 2