So let me get this straight - under the new tax plan middle class will get higher tax refunds?

I make a little over $50K a year. Under the old tax plan I got a $400 payroll tax credit. Under the new plan I get a 2% credit on $50K in earnings so I will actually get $1000 or $600 more than last year? Is this correct? And the unemployment benefit was extended for 13 months. And the increased tax refund goes to individuals who make up to $110K.

The richest 2% of Americans will see no change in their taxes from last year and will still enjoy the reduced rate introduced by Bush for 2 more years.

How does this affect me or most middle class Americans negatively? I don't really understand the outrage exhibited here.

The long term deficits will go up based on this extension and further reduction of taxes for the middle class but that really doesn't affect me at this point. We have had deficits for my entire life and it hasn't changed my lifestyle or negatively impacted me in anything other than an abstract way.

I know people are mad that millionaires and billionaires will continue to have lower tax rates but that really doesn't affect me either in any real way.

There is so much doom and gloom on DU lately and so much hate for President Obama but it seems to be similar to the tea party anger exhibited towards him, white hot emotion but not based on any tacit real world personal injury from the policies he is getting enacted into law.

The Presidents approval ratings appear to be stabilizing and even going up based on recent polling. I don't hear my non-political co-workers spouting off right wing talking points anymore or bashing him and there seems to have been a leveling off of Obama bashing among the average American from my perspective. Those on the extreme right still hate him but seem to have lost a little of their passion but that has been replaced by those on the left who are boiling over with anger.

The President says he got the best deal he could under the circumstances he faces. I take him at his word. He seems very tired and beaten down by the awesome responsibility of his job and I, for one, still support and admire him.

be changed at the time you are paid.

Some people just want to see the rich suffer just a little (3% raise in marginal rate) they are willing to annihilate the middle class (losing UI exension, child tax credit, marriage penalty relief, 10% vs 15 bracket, etc) to see it.

To correct one thing in your post the working rich do get a larger break.

SS is capped at $106K. So someone making $106K would get 2% = $2,120 vs $400 in 2010 for net reduction of $1,620. Still I consider it a plus.

Compromises tend to make people upset because there is a ying for every yang. Personally I think no compromise and everything resets would be horrible for middle class and for aggregate demand. Demand = jobs. Less demand = less jobs something we can ill afford right now.

Your wealthy brethren will certainly be enjoying their enormously larger sum.

How does this affect me or most middle class Americans negatively?

Because it hands over almost a trillion dollars to those who are already rich and don't need it, all on your kids' credit card. Furthermore, it undermines your retirement since the "compromise" also defunds social security via the nefarious reduction in payroll tax.

Those on the extreme right still hate him but seem to have lost a little of their passion but that has been replaced by those on the left who are boiling over with anger.

Gee, I wonder why?

This "compromise" consists of giving the republicans 100% of what they ask for and then some, in exchange for a 1-year extension of unemployment benefits only for those without jobs under 99 weeks. It drains an additional $800 billion out of the treasury directly into the wallets of the rich.

It shocks me that you would admit that you "admire" someone who would portray this as any kind of positive thing. Since it is essentially John Boehner's wish list, you should say you "admire" John Boehner.

as I understand it. $1.64 a day times 365 days is $598.60 so I will enjoy that extra money and put it back into the economy which may stimulate growth and jobs and multiply that times tens of millions of Americans who will enjoy the same and theres an extra hundred billion in stimulus to the economy. Not too shabby.

You really think John Boehner gives a shit about the unemployed or giving me back $600 more per year?

And I am really interested in how this affects you personally. Without snark or sarcasm, did you benefit from this deal personally or not?

Cheney may have said "deficits don't matter", but obviously there is a level at which they matter a lot. The Republicans spent the election saying the most important thing was to reduce the deficit, and countries like Greece and Ireland have been told to enact austerity budgets because their debts and deficits are too large. Now, the outcome of the stand-off has been "increase the deficit, increase the debt, and put off working out how to pay for this for a couple of years, at least".

And when that comes round, it seems certain the Republicans will look at the relative amounts of tax being paid by low and high earners, and shout that there's no way that high earners can have their taxes raised, and that the US needs some austerity itself, and they'll try to cut non-defense spending - quite possibly including Social Security (ie that old 'non-defense discretionary spending' phrase will be retired - they'll attack the spending that, until now, has been regarded as
non-discretionary). The cut in employee payroll tax may be used as an entry point for this - they'll say something like "we can't possibly put the payroll tax rate back up, and we can't put more money from general taxation into the fund, so we have to cut Social Security payments"; and probably want the Social Security fund to pay back what it gets from general taxation over the next couple of years.

It's a ratchet effect; it now seems politically possible to cut taxes, but never to raise them, and so the Republicans seize any opportunity to cut them - especially taxes on the rich (note that it's not just income tax getting cuts - estate taxes have been slashed too, compared with what they'd be with no bill), in the confident expectation they'll be able to force a cut in spending more easily than anyone could put the taxes back up. And so the government gets drowned in Grover Norquist's bathtub.

This is why I am outraged. We need to deal with the deficit and this doesn't even start to do it. Just kicking the can down the road.

The price for a 'bigger refund.'

elected. Job growth, GDP, stock market, auto industry have all seen dramatic improvements. This may slow recovery for 2 years or it may stimulate the economy with $120 billion more spent by consumers. This is a stimulus package that will have more money flowing into the economy starting January 2011.

:beer:

Sounds to me like you are already well above the median income (which is almost $50,000), while I am well below it.

That's kind of beside the point, but it is kind of not. When $120 billion in tax cuts is given out I kind of think it sucks when $80 billion of the total goes to people ABOVE the median income while $5 billion goes to people in the bottom 20% (note, both the $80 billion and the $5 billion are educated guesses, I don't have actual numbers, but I think my guesses will be in the ball park.)

If you imagine that windfalls to the billionaires do not affect you, then you are sadly mistaken. This only adds to their power and accelerates our trajectory into a third world country with vast disparities in wealth. It's an iceberg which is tearing a huge hole in the fabric of the ship of society but you think that isn't gonna affect you. Well, that's certainly what they would like you to believe.

You seemed to have missed the whole point. Republicans took a stand here. They stood up and fought for the millionaires and billionaires who give them the money to re-elect them. Some of us foolishly believed that Democrats and Obama would fight on the other side, would fight on our side, for those of us below the median income. You know, that is 50% of the population. It should be far more important than the top 2%.

Further, it seemed to me that it was a fight not only that my party should have waged to prove which side they are on, but it was a fight we could win. We did not have to beat a fillibuster. If nothing passed, then the tax cuts would expire and the blame would belong to the Republicans. THEY would have caved in order to prevent that. Except they knew they didn't have to because they saw that their opponent was weak and scared.

So now the left is the only group that hates him? Well, it is sorta natural that the group that was betrayed would be very, very angry. But you think we should be happy because now maybe Obama will be re-elected. Yet, since his re-election only promises "more of the same" - capitulation to Republicans and continuations of Bush policies. Well, it does not seem like much of a prize. It's a little bit like being promised another serving of punch after Obama just took a giant dump in the punchbowl. Drink up!!

but, like you said, it is beside the point.

You assume that if the President and Congress just did nothing and the tax rates went up for everyone that Republicans would get blamed or it. Based on what? This President is blamed for everything and gets credit for nothing from the media, his detractors and his alleged supporters. Republicans would blame the President, the media would follow suit and the average American would believe the echo that the evil President took money from their pockets to support his liberal, socialist, communist, fascist agenda.

The President would then face an angry population and a Republican controlled House and would get even less than he got out of this deal. No extension of unemployment benefits and no increase in tax cuts to the middle class. It would also almost insure more republicans would win in the next election.

There are hundreds of Democrats in the House and Senate and I didn't hear a chorus of voices saying they would let the tax cuts expire. It is not a popularly supported idea by the majority of Americans (I can provide polling data if you want it).

So the President cut a deal that benefits 2% of American of the wealthiest taxpayers but also benefits the 80% of Americans who make up the middle and lower income earners in this country.

Because their votes would be on record. Every opponent would have a nice gift wrapped club to hit them with. "Republican X voted to let the tax cuts expire." "Republican X fought for the millionaires against the middle class." They would not want to let that happen.

But Obama just took that away from our party. Now what is our slogan gonna be? "Vote for the Democrats because we will cave to the Republicans on everything." I am not seeing much marketing appeal in that.

Also, the median income is for a household. I figure that there is a 70% chance that you are married (or soon will be, since you are clearly a financial catch). If you have a spouse, which seems likely and if your spouse has a job, which also seems likely, then your income is well above the median.

Just like the original Bush tax cuts, it is a bad deal because the majority of the benefits goto the top 20%. And a very much smaller percentage of the benefits goto people in the bottom 40%.

If we had won the fight, we would have gotten a much better deal. More importantly, we would have set the stage for Republican defeats instead of showing once again, that the Democratic Party won't stand for anything, except abuse from Republicans.

So my household and individual income are the same. If you know any single ladies in the Oklahoma City area who are looking for a financial catch, albeit an Obama apologist, I am interested :) I have a mortgage, a car payment, child care costs and the normal unsecured credit card debt that most have so I get by paycheck to paycheck. I have real sympathy and compassion for those who are somehow getting by on much less.

It is really all supposition on both of our projections and I willingly admit that I am predicting what would happen based on my experience and understanding of recent history. The President gets little to no credit for his accomplishments and gets the full blame for any negatives, real or perceived. The Congress is held in lower esteem and their poll numbers reflect that but it didn't stop the republicans from winning a majority in the house and nearly winning the Senate.

Since the payroll tax deduction is a percentage of income, the larger portion would obviously go to those who make more. What would you propose to give more back to lower income earners? There is the earned income tax credit which helps many.

I appreciate the civil debate and am truly interested in your thoughts on this subject.

my Oklahoma uncle just had 3 sons.

The Making Work Pay credit was a) equal and b) had a cap of $95,000. Theoretically it could a) be increased and b) have the cap lowered.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=9721446&mesg_id=9721446

I think the frames of Republicans are on the side of the top 2% and Democrats are on the side of the bottom 90% could work in elections, but admittedly it did not work too well for mine. Not even in a Democratic primary. But the President has now kicked the legs out from under that frame, and he seems to be more of a "me too" Democrat. That's where the Republican says "I will cut taxes and cut waste and the deficit" and the Democrat says "me too". Leaving voters to decide the election on abortion, guns and gay marriage.

in amarillo. really really nice. what? a three hour drive? she could do an obama apologist, grinnin

As I understand it, employer and employee each pay half of this tax. Is this 1% off each contributors half? Is it 2% off each half? Is it 2% off only the employees half?

Accountants correct me if I am wrong.

YOu are correct. The 2% will be reduced from the employees' check, not the employer's contribution portion.

:thumbsup:

The Obama 'compromise':

"The tentative deal includes a two-year patch for the alternative minimum tax, a reduction in the payroll tax and a plan to reinstate the estate tax with lower rates and higher exemptions than in 2009 — all of which will offer far more savings for high earners than those in the low- or middle-income bracket.

The wealthiest Americans will also reap tax savings from the proposal’s plan to keep the cap on dividend and capital gains taxes at 15 percent, well below the highest rates on ordinary income.

And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes. That is good news for hedge fund managers and private equity investors, who appear to have withstood an effort to get them to pay more by eliminating a quirk in the tax code that allows most of their income to be taxed at just 15 percent.

In fact, the only groups likely to face a tax increase are those near the bottom of the income scale — individuals who make less than $20,000 and families with earnings below $40,000.

“It’s going to look like the rich are getting richer again,” said Anne Mathias, an analyst for MF Global Inc.

In the agreement, which breaks a campaign pledge to eliminate some tax breaks for the top 2 percent of American earners, President Obama won a few concessions from Republicans, including a 13-month extension in government benefits for the long-term unemployed. After several extensions, the maximum has been 99 weeks."

http://www.nytimes.com/2010/12/08/us/politics/08impact.html?_r=2&hp

However, as for the unemployed, 99 weeks *is* still the maximum under this plan. The extension is for those who have not yet reached that max, so this leaves about 4 million unemployed people with no benefits, and no jobs.

http://www.huffingtonpost.com/2010/12/03/unemployment-benefits-99ers-obama_n_791682.html

from the Making work pay credit....which would have expired anyway.

However, same folks, if they have children,
would still would get the largest portion of EIC,
and the Child tax credit, which in itself gives money to taxpayer that taxpayer didn't pay in.

40 bucks for the person approaching twice the vaunted poverty rate to get some thousands in the hands of those 100k+.

We claim we HAVE to do this for the least of us but the top 20% of the country will be getting the lion's share of the benefit.

My over under on tax benefit to those at 50k and under is 100 billion.

We should keep the 10% bracket by recouping the lost revenue (and then some) from a new bracket starting in the 1-1.5 mil area, have an honest discussion about the child tax credit and how much we want to actively encourage a gaggle of kids, let the rest of it die, and call it a day for about 5 years or so.

You cannot seriously look at the problems we have and pretend this tax cuts are an appropriate application of resources nor recall the last decade and have any reason to believe the cuts are in any way positive for the broader economy.

You guys are essentially saying you believe that if Bush hadn't got these tax cuts that we'd be in a deeper hole and that is laughable and proof positive that if Obama is involved then y'all go all in, no matter the hand.

Wow....someone who makes sense, right here at DU!

Who would have thunk it! :crazy:

The money will need to be made up somewhere else, like HEAP, food stamps, medicaid, or aid to states.

There's a sucker born every minute. On DU, I think it's much more than that.

Plain and simple, you sold yourself out for pocket change.

do I personally benefit from Mr. Obama's sell-out deal? Yes, I personally will benefit. But is it morally right to put our children and grandchildren trillions of dollars in debt so you can have an extra latte at Starbucks every day? Is it morally right for the top 2% of this country to make so much more than the other 98%? I guess I could just look out for myself, in which case I'd lurve President Obama and his predatory ways, but unfortunately I was born with a conscience. Evidently you were not.

:puke:

My kids will, and yours, if you have them, and the whole damned country. We can not afford that cost.

It's disingenuous to pretend you haven't heard this part of the debate, when you clearly have the other points down pat.

That I have to pay thanks to his compromise.

I imagine many more of us at the bottom will be thrilled to know we're helping keep the billionaire's lights on (even if ours aren't)

I don't go to bars (except on rare occassions). But I think people should be allowed to smoke in them.

The point? It's called principle.

You run on something, you tell people doing X is bad and will hurt the economy. You then do X and try to make it look ok by doing Y and Z as well.

It would be like outlawing abortion when you are for keeping it legal but in the same legislation giving a free year of diapers and extensions to free lunch programs.

I am not outraged at the tax extension itself, it's the lies and breaking of principle and trying to make it look pretty that pisses me off.

Unemployment extension should have been a sep. issue which we could have passed. We used it and the needs of others as a currency.

but effect others.We knew that anything the President wanted was going to be hinged on the bush Tax Cuts. We saw it coming like a ton of bricks!!!Everywhere you turned all you could hear is the Mantra that it would be bad for the economy if anybody taxes goes up.Taxes shouldn't be raised on anyone during a recession.

The people who would have lost their UI benefits are probably glad to have some of them restored to some.Just as the unemployment numbers went up, without the extension that will be the same numbers of people who would start losing their benefits. Weren't we at about 700,000 a month? A lot of people to leave in the cold without food or a way to meet their bills.

I always wish when the President goes into negotiate for the people he would not play his hand and be on the extreme left and allow them to move left . Or let them the repugs design and craft a bill and let Democrats argue and fight over amendments and call them death panels and what not. Then force their votes. One of the major problems with legislation. Our President will only put through what he thinks he can get enough votes for. With Dems and Repugs so embedded in corporate pockets and the ability to walk off the job with your campaign war chest, there is no incentive to do right by the people. The truth be told it won't matter what President we put into office as long as corporate hold is on Congress.