Taxes. We all pay ’em and we all hate ’em. Both candidate have set forth their tax plans should they be elected. The Tax Policy Center, a non-partisan think tank, crunched both campaigns’ numbers. Business Week (hardly a lefty publication), has the details.
Len Burman, a former Treasury tax official who is now a senior fellow at the Urban Institute [ed. part of the Tax Policy Center], says if Obama’s proposals—which include plans to rescind the Bush tax cuts on couples making more than $250,000, close corporate tax loopholes, and tax private equity earnings known as “carried interest” as ordinary income—were adopted in 2009, for example, married couples with earnings in the lowest quintile of the population would see their aftertax income rise 5.8%. Those in the next quintile would see an increase of 4%. Those breaks would be paid for by those with high incomes: the top 1% of taxpayers would see aftertax income fall 8.4%.
Under McCain’s proposals, by contrast—including an extension of the Bush tax cuts for all taxpayers, a corporate tax cut, and a larger reduction in estate taxes than Obama would support—far more of the benefits would go to the top. If his plans went into effect in 2009, married couples in the bottom fifth of the population would see aftertax income go up just 0.2%, while those in the next quintile would see a 0.7% hike. But those in the top quintile would see a bump up in aftertax income of 2.7%.
And the middle class? Yeah, we all get a 0.7% increase with McCain and a 4% increase under Obama.
And how about that deficit the Bush administration is leaving us?
[Under Obama] those moves would bring an estimated additional $734 billion to the Treasury over 10 years.
… McCain’s combined proposals would slash tax revenues by an estimated $253 billion over the 10-year period.
Brilliant. An income increase for the richest of the rich and no meaures to increase revenue to the Treasury. Of course, as the article points out, this is all based on their plans being implemented as promised, which rarely happens. So what’s the value in this kind of analysis?
“It gives us some sense of their view,” says Burman.
Exactly. And that view is pretty telling.