I don't know a single millionaire who needs a tax cut right now. But I know plenty of middle class Americans who desperately need every extra dollar in these tough economic times.
That's why I strongly support the "Middle Class Tax Cuts Act" to give permanent tax relief to the struggling families that need it most. The economic turmoil of the last three years has left many Americans cash-strapped and struggling to stay afloat. And make no mistake, extending the current tax rates for the middle class is crucial to encourage economic growth.
By extending current tax rates for 98 percent of taxpayers, we provide certainty and security for hard-pressed, working-class Americans.
Here's a basic truth: America is in trouble.
And I firmly believe that it's important for those people who can step up to do so. The best way to do that is for the richest to pay the additional 4.6 percent tax. That's not asking much. It's not the wealthiest Americans bearing the brunt of this recession (sales of luxury goods are surging -- the rich seem to be doing pretty well), it's the middle class doing the most suffering.
Evidence does not support extending tax cuts for the wealthy. When the CBO analyzed a number of different job-creation polices, tax cuts for the wealthy came in dead last. In addition, extending the Bush tax cuts for the wealthy would require $700 billion in deficit spending. On one hand, Republicans preach the need for fiscal restraint. At the same time, they call for tax cuts for the rich that will deepen our debt. Something doesn't add up. It would be one thing if the Bush tax cuts for the wealthy had contributed to an era of sustained economic growth and prosperity. But we know that history doesn't back that up.
In 2001, when the first round of Bush tax cuts for the wealthy were proposed, we enjoyed a long-term surplus of $5.6 trillion. Eight years later, President Bush left the country an economic mess. The surplus had devolved to a 10-year budget deficit of $9.3 trillion, and the national debt had increased by more than 80 percent. Need more figures to prove that middle-class Americans need tax cuts more than the rich?
- From 2003 to 2007, income for families in the top 5 percent of taxpayers increased by 7 percent, while incomes for the other 95 percent of taxpayers' remained stagnant.
- The average income of the top 1 percent of earners increased by 10 times that of the bottom 90 percent.
- During the expansion of 2002 to 2007, families saw their median income drop by2,000, the first time ever that Americans have seen their incomes drop during a period of economic growth.
- During that time, income tax rates for the top 1 percent of earners were reduced by twice as much as rates for everyone else.
- And in 2007, the top 10 percent took home almost half of the country's total earnings, the highest level of income inequality in our nation's history.
Clearly it's time to extend tax cuts for those Americans who need it. And it's time to end the Bush tax cuts for wealthy Americans.