Ending the Bush Bonus Tax Cuts Requires Little Sacrifice, Does No Harm

The Deficit-Busting Pay Freeze We Need

... To hear opponents speak of this proposal, one would think that the fight over these tax breaks for the wealthiest is an epic struggle over whether to veer the country onto a path to socialism or continue to allow the successful the fruits of their success. Well, it isn’t.

In fact, assuming the income of the wealthy continues to rise at the same rate it has over recent decades, allowing the Bush bonus tax cuts to expire basically would result in a mere 10-month pay freeze for the richest 1 percent—after which their income is back where it started and the rapid rise of the income of the wealthy will still be on track. As figure 1 shows, if the tax cuts were allowed to expire at the end of 2012, as currently scheduled, the effect on annual income for the top 1 percent would be a dip in the rate of increase for 2013—and that’s it. Their after-tax income for all of 2013 would still be higher than for 2012 even adjusted for inflation. And it would continue to grow.



The wealthy can afford a 10-month pay freeze...