President Obama Proposes One-Year Extension For People Earning Less Than $250,000 Per Year

Earlier today, President Obama called on Congress to pass a one-year extension of the Bush tax cuts, but only for those people earning less than $250,000 per year.

President Obama said that his proposal was a "compromise" that would ensure that 98% of all Americans would see no tax increases next year.

Republicans, on the other hand, are proposing a one-year extension of all of the Bush tax cuts. Republicans argue that smaller government, not higher taxes, is the solution to the country's deficit problem, and that keeping taxes low is the "right thing to do to get the economy growing again." Republicans have repeatedly said that they want to avoid raising taxes on the "job creators".

The country is moving towards a so-called "fiscal cliff" - a combination of spending cuts and removal of tax breaks that will come into effect on January 1st, 2013. With the US economy in a fragile state (just look at the jobs reports from the past few months), both sides agree that the "fiscal cliff" needs to be avoided at all costs.

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This past weekend, Robert Gibbs (top Obama campaign adviser) appeared on CNN's "State of the Union" and said that Obama was "100% committed" to ending the Bush tax cuts for the wealthy.

The Obama campaign is trying to establish the President as a champion of the middle class, while painting the Republicans as only being interested in protecting the interests of corporations and wealthy individuals.

The Republicans, on the other hand, will argue that Obama is a tax-happy proponent of "big government", and that the country needs low taxes and lower spending in order to get out of its rut.

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With the recent "Obamacare" decision and the debate over the Bush tax cuts suddenly flaring up, it's safe to say that the battle for the White House has really kicked into a higher gear.

Source: CNN.com - Obama Renews Call For Holding Down Middle Class Tax Rates

Filed under: General Knowledge

1 COMMENT - What Say You?

Comment by Pmorgan on July 09, 2012 @ 7:51 pm

IRS data on the Effective Federal Income Tax Rate paid by the 400 US taxpayers that have paid the most in taxes in each year since 1992 shows that their average effective federal tax rate rate peaked at 29.9% in 1995 and that this rate has declined to 19.9% in 2009.

IRS data also shows that from 2001 to 2010 the total Adjusted Gross Income (AGI) from all tax payers with AGI over $ 1 Million per year increased by 45%. Your table on the inflation adjusted median income of the US shows a 5% decline from $52,005 in 2001 to $49,445 in 2010.

Clearly cutting the taxes of the wealthiest in the US has helped them way more than it has helped the average American.

http://economix.blogs.nytimes.com/2012/06/19/as-income-inequality-grows-some-movement-at-the-top-and-bottom/
http://www.davemanuel.com/median-household-income.php

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