On May 28, the Bush administration released several items celebrating the 2001-2003 tax cuts.
- Press release;
- Topics Related to the President's Tax Relief. May 2008
- Tax Relief in 2001-2011
- White House Fact Sheet
The Fact Sheet asserts that the "largest tax increase in history is looming." As OMB Watch notes, at this link, this is "an ironic canard", since the President's budget merely assumes away the problem of paying for any extension of the temporary tax cuts. The 2001-2003 legislation enacted huge but temporary tax cuts because legislators knew that the economy couldn't manage the cost--$400 billion less just by 2012--of making the legislation permanent. Now Bush wants to pretend that wasn't so, and simply disregard the cost.
And Bush also wants Americans to think that the tax cuts were progressive merely because "a small group of high-income taxpayers pay most of the individual income taxes each year." Of course, informed readers will recognize that the fact that one group pays most of the income taxes doesn't establish the progressivity of the tax cuts: you have to know something about trends in income and trends in tax payments.
The fact is, the wealthiest Americans have been getting a larger and larger share of the income, and they are paying a relatively SMALLER share of income taxes under the Bush tax cuts. Ordinary Americans are getting a smaller share of the income pie, and paying relatively MORE of the tax burden. OMB Watch has some great graphs illustrating this point, in a May 29 analysis of the Bush materials.
Revised 6/5/08 to incorporate OMB Watch's corrected graphs (axes were mislabeled).
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