The Coming Republican Tax Increase

Sept 8th, 2011
by F. Grey Parker

One of President Obama's central talking points in this evening's "jobs speech" was the call to extend the current "payroll tax cut." I think we, the people, can expect the Republicans not to do so.

Really. They are planning to raise taxes. Disproportionately on the poor. That's their plan.

Sara Murray writes today in the WSJ:

"The tax cut reduced an employee's share of the Social Security payroll tax to 4.2% from 6.2% for 2011, at a cost to the government of $111.7 billion."

As a regular reader of the Journal, this is very telling. It is not often that the editors of this particular outlet allow a tax cut to be referred to as a "cost to the government." In fairness, Murray's piece is not overtly participatory in the War on the Poor. She points to one factor that may have mitigated the policy's benefit:

"The economic effect of the tax cut wasn't as clear as some had hoped. A Goldman Sachs analysis showed the average personal income tax rate barely dropped at the beginning of 2011, in part because the payroll tax holiday was offset by the expiration of the Making Work Pay tax credit, a refundable credit worth up to $800 for married couples.

In contrast, Macroeconomic Advisers projects that extending the tax cut for another year would increase U.S. employment by 400,000 jobs next year and add half a percentage point to the pace of economic growth, at a cost about $120 billion."

Let's be blunt. Failure to extend the cut would mean an average decrease of $1000 in every American worker's take home pay. In an economy that is roughly 70% consumer-purchase driven, this would be a disaster and would also further increase the likelihood of a double dip recession.

Unfortunately, legitimate bipartisan economic analysis has been consistently ignored by the elected Republicans who dominate the 112th Congress. They live in a one word "word cloud."   Debt.

To try and engage this cabal of incredibly wealthy extremists in a discussion of the principles of demand is a bit like trying to teach a turtle to speak French.

Too much effort has already been expended in the running meme that "the poor" are somehow to blame for what ails our country. It is not in the party's interest for the Republicans to do what is right for the country's interests.

Nonsense about "the poor" not having "skin in the game" is the order of the day. The fact that even the poorest minimum wage worker still pays a lot more than just payroll taxes is ignored ---

State Taxes. County taxes. Municipal taxes. General sales taxes. Gas taxes. Utilities taxes. Communications  taxes. Property taxes. Water bills. Highway tolls. Parking meters. Park fees. Beach fees. Camping fees. Hunting licenses. Fishing licenses. Driver's licenses. Mandated car insurance. These are all just part of the contribution everyone makes. To paraphrase the great Oliver Wendell Holmes, this is how we pay for civilization.

This is all, apparently, not good enough for the far right. They have identified the enemy and it is the poor. For example, over the last several years, there has been a concerted effort to lay responsibility for the housing collapse on people who didn't understand questionable mortgages with variable rates that led to sudden explosions in monthly payments. It wasn't the bank's fault for engaging in patently dishonest or even criminal behavior, it was the dirty poor taking advantage of institutionalized criminality.

It is now de rigeur for corporatists to stipulate, in one breath, that the President is to blame for "crushing" or "killing" jobs while also accusing "entitlement society" for corroding our country's work ethic.

Get it?

There are no jobs because of liberals, but the people who don't have jobs? They refuse to work... because of liberals.

Mathew Vadum's now infamous call to roll back voting rights 200 years, bluntly titled "Registering The Poor To Vote Is Un-American," has received a lot of play. No one seems to be admitting a simple fact, though. It is simply the most honest call to give the poor what the right believes they deserve.

It is not the most extreme.

After Obama's speech tonight, one thing is still guaranteed. Any proposal to get America working again which does not have as its beginning, middle and end a new proposal to give more money to America's corporations will be deemed wrong-headed by elected Republicans.

The President is to commended for arriving with not only the right tone, but the right plan.

'Tis a pity that traitorous plutocrats were against it before they even knew what it said.