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Comparing the Obama and McCain tax plans

Posted on Thu, 06/12/2008 - 5:21pm by Markus Kolic

Look:

These are from the Tax Policy Center's new report (PDF here, it's dense and detailed but worth reading if you're a wonk) on the two presidential candidates' tax plans. The differences are pretty stark: McCain wants to keep the ludicrous Bush tax cuts (and, incredibly, cut corporate tax even more), while Obama wants to roll them back on the wealthy and introduce targeted exemptions and credits for everyone else. Consequently, as you can see above, the Obama plan produces an immediate gain for the bottom 80%, while McCain's is helpful to the top fringe. In the long term, working-class and middle-class Americans will benefit more greatly from the Obama plan, while McCain's plan overwhelmingly favors the ultrarich elite.

Another illuminating policy difference is the estate tax, which is levied on multimilliondollar inheritances (read: Daddy's yacht. And to preempt the inevitable Harvard Republican rebuttal, no, family farms and 96% of small businesses are NOT affected by the estate tax. Do your research). Obama will keep the current exemption levels (slated for $3.5 million in 2009) and set the rate above exemption at a sensible 45%. McCain, however, would raise the exemption to $5 million -- meaning someone who inherits $4.9 million would pay nothing on it -- and set the rate at just 15%. You don't need an economics degree to figure out what's happening there.

So in short: Democratic policy supports the interests of the middle and working class, while Republican policy amounts to a handout to the superrich elite. In other news, grass is green and the sky is blue. But this is a helpful reminder of both how radical John McCain (and the entire Republican Party) really is, and how basic the issues really are in 2008.

(from TaxProfBlog via TPM)

UPDATE (Monday, June 16): Paul Krugman argues in his column today that Obama doesn't go far enough in raising revenue, and has accepted the conservative framework that tax cuts are the best thing you can do for working people. It's a valid argument, but I think -- and this is one of the only times I've ever found myself disagreeing with Paul Krugman -- the key thing is the progressivity of the tax system. Raising taxes on the rich is preferable to raising taxes on everybody, and Obama's plan embraces that philosophy (in a way, also, that will make it very palatable to the public). The revenue we need for UHC and deficit reduction and whatever else can come from spending cuts (esp. in defense once we're out of Iraq) and further tax hikes on corporations and the highest brackets.

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Elitism is Everywhere These Days

Posted on Mon, 06/18/2007 - 2:46pm by Markus Kolic

Three examples.

1. Libertarians: "See, the public at large is stupid, because it rejects the ideas of economists and economists are always right. Democracy sucks."

2. Conservatives: "You know who deserves more credit for their dedication and hard work? People who inherit boatloads of money."

3. TIME Magazine: "Look! A rich guy and a celebrity! I wish they ran our government." (swoon)

I don't know about you, but I'm getting a little tired of this. Money is not the arbiter of intelligence, capability, or merit, nor does it necessarily flow towards people who display those qualities -- yet we see the above kinds of arguments in our public discourse all the time. I'm not sure whether they come out of a misguided faith in market capitalism or a fetish for money (if there's a difference); but it's damn time we stopped listening to people who consistently glorify the most powerful at the expense of everyone else.

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(big h/t to Sadly, No!, which is always good at pouncing on this stuff)

Filed under: class • economics • elitism • estate tax • libertarians • rich • wealth

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