Pawlenty Plan Would Quadruple Tax Cuts For Richest Americans: CBPP

Move over Bush and Obama, there's a new king of tax cuts in town.

A recently-proposed tax plan by Republican presidential candidate Tim Pawlenty, which includes several major tax cuts, would dramatically favor the wealthiest 0.1 percent of Americans, according to the non-partisan Center on Budget and Policy Priorities, who used previous analysis by The Urban-Brookings Tax Policy Center.

Indeed, the cuts proposed by Pawlenty would quadruple cuts received by the wealthiest 0.1 percent last year saving them an annual average of $1.8 million.

Specifically, Pawlenty's proposal would simplify the entire tax code by having only two rates for individuals: Americans would be taxed 10 percent for their first $50,000 of income and then 25 percent for all wages earned beyond that. In addition, corporate taxes would be cut to 15 percent from 35 percent.

It's estimated that the cuts would result in tax revenue of only 13.5 percent of the national GDP, according to the Center For American Progress cited by Business Week. That's less than the annual 18 percent average since World War II. It's lesser still than government spending last year, which equated to 25 percent of GDP.

Pawlenty says the cuts, among other things, will spur businesses to hire and provide the solution to what he views to be a failing recovery. "These changes will make American companies immediately more competitive," he said in a speech outlining his plan at the University Of Chicago last week. "Investment from around the world will pour into our suddenly inviting market. Creating desperately needed jobs -- and opportunities."

At least some Democrats disagree. Democratic National Committee Chairwoman Debbie Wasserman Schultz said in a statement "Mr. Pawlenty would take the Republican policies of the last decade, which exploded our deficit and debt and nearly sank our economy into a second Great Depression, and inject them with steroids."

Below graph compares percentage change in after-tax income of the two plans:

Comments

[1Truthseeker]

01:19 PM on 06/20/2011

Pawlenty worked hard to make this a reality in MINNESOTA and left our State with a 6.2 billion dollar deficit. He knows how to destroy an economy.

[hypnotoad72]

09:38 PM on 06/30/2011

Fanned and faved

[shrinktalkingheads]

12:14 PM on 06/20/2011

Republicans cannot and will not give up on the idea that tax cuts create jobs. We've had ten years of tax cuts!

Ten years!

Where are these mythical jobs?

In China. In India. And in Mexico.

[offmyrocker]

10:11 AM on 06/20/2011

OH my there goes the freebies

[kiddo418]

05:48 AM on 06/20/2011

Looks like Mr. T-Paw will say or do anything for attention. Poor thing.

[RPDash]

01:58 AM on 06/20/2011

At least we don't have to worry too much about this voodoo economics since T-Paw is going nowhere real fast with his candidacy.

[axt113]

01:05 AM on 06/20/2011

I thought baggers wanted to reduce the deficit?

[Klarsonent]

11:50 PM on 06/19/2011

Where do these Republican candidates come from? Another planet, or what?

[axt113]

01:06 AM on 06/20/2011

Jeebusland, the capital of baggerstan

[offmyrocker]

10:13 AM on 06/20/2011

NO from parents that raised us to live with in our means. Pay as you go you know, responsibilty for one's self.....Just get your checkbook out LAND LADY and write a check to the IRS....OH not my money,,,,I get it

[hewhowaits]

10:10 PM on 06/19/2011

He is just another crook.

[offmyrocker]

10:14 AM on 06/20/2011

Hey a crook who want people to keep more of the money they make...What a crook, hey just get your checkbook out and cut an extra check to the IRS. I know you feel you need to so go for it if not stop wanting to spend ours peoples money

[hypnotoad72]

09:41 PM on 06/30/2011

Nice meme.

Ever bother to look to notice how wages have been stagnating, or lowering?

Just wait until it's impossible for a job to pay for dinner - we all can't work six 8 hour jobs per day for $2/hr...

http://motherjones.com/kevin-drum/2010/01/vicious-cycle-stagnant-wages

Forget taxes for now, they're over-talked.  Let's talk about real wages.  And real prosperity.  The value of work.  Which means not whittling it down just so the top 2% can pocket it and run off with it.

[becky bradshaw]

09:07 PM on 06/19/2011

That's Amore! Champagne, pretty girls, fast cars, and a hot sea ride; life can be so sweet. The number of super-cars and mega-yachts doubled since the Bush tax cuts took effect (http://www.msnbc.msn.com/id/13345720/ns/business-cnbc_tv/#).

Pawlenty's tax cuts will be icing on the cake.

[offmyrocker]

10:15 AM on 06/20/2011

sounds like a great boost to the economy to me

[becky bradshaw]

11:53 AM on 06/20/2011

It has worked so well the last 10 years.

[brutus1065]

05:45 PM on 06/19/2011

It is not tax cuts stupid- its Domestic Business Investment Tax credits

Palenty;s tax cut is nothing more than a give away to the wealthy under the pretext the wealthy will invest the money from the tax cut in businesses that create jobs. History though disproves this pretext. Taxes have been low since the bush tax cuts and where are the jobs? Multi-national companies took our tax cuts and built plants and invested in equipment and creatred jobs overseas. Why double down on a tax policy that has not worked .

If Palenty wants to promote investment in businesses in this country that create jobs for this economy, then he should exchange tax cuts for Domestic Corporate Investment Tax Credits. Why just cut taxes. You never give up something unless you get something in return. I want control of the tax cuts, so that I know it is being used for the purpose it was intended- to create jobs here in this economy.

The credits can be used only to invest in US based companies that do not have overseas operations. Our innovators need the money to innovate and this would be a good source of capital for that. The credits expire in 12 months, that way we now the timing of the capital infusion and can butress business investment with other stimulative actions, llike infrastructure spending.



this message is created by Citizens Who Think Pawlenty and Michelle Bachmann are Stupid.ORG

[offmyrocker]

10:16 AM on 06/20/2011

so under your logic 100% of ones earnings belong to the goverment. Then the government gives you back what it thinks you deserve. One more person who pays nothing in income tax.

[collettethehedgehog]

09:25 AM on 06/19/2011

What's worrying to me is-say they are able to get even more tax cuts for the rich and there ar the predictably even more diastrous effects on the middleclass, then how do they plan to keep them. I believe Lincoln is right-you cannot fool all the people all the time. And the American people are not that stupid as a majority....so when they have created a Mexican economy with one percent extremely wealthy, no jobs except as drug entrepreneur-how do they plan to keep themselves in power?

[offmyrocker]

10:17 AM on 06/20/2011

have the middle class take care of themselves, WOW what a concept take care of yourself...WOW I'am gona win the Nobel

[collettethehedgehog]

01:37 AM on 06/21/2011

Just the way they took care of themselves in Adam Smith's day. Oh wait there wasnt one. The reason he wrote his books on economics was a dream that there might be something in between poverty and wealth. But of course you've actually read " Wealth of Nations" being such a Nobel prizewinner.

[Roadrun]

09:03 AM on 06/19/2011

He does have a point - him and his GOP cronies are making America more competitive, Now they just need to be honest and say that it is a competition for the cellar of 3rd world countries. If they have their way Americans will soon be pirates ransoming ships.

[schatsie]

10:09 AM on 06/19/2011

kidnapping and embezzlement will be the growth industries....

[StChasDem]

08:16 AM on 06/19/2011

Mr. Pawlenty -- another idea. Lower the workers wages to $2.00 an hour. That should help businesses a lot. Oh, and get rid of employers health care cost. Workers can go out on the free market and find their own health care.

[becky bradshaw]

09:15 PM on 06/19/2011

Wages will need to drop lower, to about 70 cents per hour. (http://project7.co.nz/2011/05/07/high-tech-demand-creates-living-hell/)

[NWBrunette]

02:27 AM on 06/19/2011

Repub economics: the economy is sick, cut taxes on the rich. The economy is hot, cut taxes on the rich. The economy is just right, cut taxes on the rich.

The repub purpose behind their endless tax cut nonsense is to create an aristocrat­ic class (already accomplish­ed) and to minimize, bankrupt and eliminate all government social programs ("drown it in a bathtub"). America better wake up soon because there's not much time left before the second one becomes a full fledged reality.

[schatsie]

10:11 AM on 06/19/2011

But we will always have Babs Bush to tell us we are lucky to loose everything so we can start over with nothing....her speech in the New Orleans arena after Katrina.....our own little Marie Antoinette....

[Klarsonent]

11:53 PM on 06/19/2011

You've got it.

[Arts4u]

10:13 PM on 06/18/2011

Yea, right It worked so well during the Bush II administration. Only 3 million jobs created over 8 years... 5.5 million jobs off-shored.... all while the population grew by 22 million. In fact, it was this misguided policy which contributed greatly to the current jobs crisis and wage stagnation experienced during his administration.

http://moneywatch.bnet.com/economic-news/blog/macro-view/extending-the-bush-tax-cuts-would-they-create-more-jobs-or-just-comfort-the-comfortable/2298/

[Down in FL]

02:37 AM on 06/19/2011

No amount of evidence will convince conservative officials of this. They'll just "common sense" all of your arguments away.