This Week in Poverty: Responses to the ‘Cliff’ Deal

http://www.thenation.com/blog/172019/week-poverty-responses-cliff-deal

***SNIP

‘There is no way I would have agreed to this’

Greg, we can’t afford any of the Bush tax cuts. It makes sense to keep those for the non-super-rich until the economy fully recovers, but if we want to help the poor, they all have to be phased out.

The Washington Post states: “…the Center on Budget and Policy Priorities shows how the Bush tax cuts are likely to continue be a major driver of federal budget deficits 20 years after they were first passed. With Congress raising taxes on the wealthy on Tuesday, the effect on deficits will be somewhat less—about $600 billion less than shown in this chart. Still, they will remain the largest component of deficits for the foreseeable future.” In six years, when Republicans are again howling about deficits, will they be pushing for cutting programs for the poor or for raising taxes?

There is no way I would have agreed to this. I could have accepted a five-year limit on extending the new version of the Bush tax cuts, but making them permanent is a colossal mistake.

So, yes we have five years of some good low-income tax credits, but we are stuck with a permanent budget-buster that is 98 percent of the Bush tax cuts. And on top of those tax cuts there is whipped cream and a cherry for the rich (and in most places, $250,000+ is undeniably rich): “Dividend tax rates were permanently extended at the Bush-era levels; The estate tax was permanently set at levels far more generous to inherited wealth than before the Bush era tax cuts.”

Again, who is going to pay for these permanent tax cuts? The poor will pay. If not now, in six years.

ALGERNON AUSTIN
Director of the race, ethnicity and the economy program
Economic Policy Institute