The stimulus was the biggest middle-class tax cut in history

http://mydd.com/2010/4/14/the-stimulus-was-the-biggest-middle-class-tax-cut-in-history

The stimulus was the biggest middle-class tax cut in history

by desmoinesdem, Wed Apr 14, 2010 at 06:18:40 PM EDT


I was disappointed by some compromises made to pass the stimulus (the American Recovery and Reinvestment Act) in February 2009. I felt President Obama made too many concessions in the fruitless pursuit of Republican votes, and that too much of the cost went toward tax cuts that would be slower-acting and less stimulative than certain forms of government spending.

That said, the tax cuts in the stimulus will help tens of millions of American families, particularly those with working-class or middle-class incomes. Citizens for Tax Justice has calculated that "the major tax cuts enacted in the 2009 economic stimulus bill actually reduced federal income taxes for tax year 2009 for 98 percent of all working families and individuals." In terms of the number of Americans who benefited, the stimulus bill was the biggest tax cut in history.

In addition, "the estimated $282 billion in tax cuts {from the stimulus} over two years is more than either of the 2001-2002 or the 2004-2005 Bush tax cuts or the Kennedy or Reagan tax cuts." George W. Bush's tax cuts were more costly to the U.S. Treasury over a 10-year period, but as Anonymous Liberal noted last year,



Tomorrow is the deadline for most Americans to file their tax returns, and Republicans will try to harness the tea party movement's anger at what they view as excessive taxes and spending. However, many ordinary people may be shocked to learn how large their refunds are this year. According to the White House, "the average tax refund is up nearly 10 percent this year."

Democrats should not be afraid to vigorously defend the stimulus bill during this year's Congressional campaigns. I wish the recovery act had been larger and better targeted, but the bottom line is that Republicans voted against the largest ever middle-class tax cut.

The White House website has this Recovery Act Tax Savings Tool to help people find benefits to which they are entitled. The White House press office released this fact sheet with much more detailed information on April 12. Note: if you have already filed your taxes, you can amend them after April 15 to collect on any credits from the stimulus bill that you missed.

That has a very nice ring to it. Go for it, Democrats!

...since a Democrat is in office, of COURSE their taxes went up! /wingnut

Of course my state and local taxes ate most of that, but I still came out with a net refund whereas I was looking at paying taxes this year. Now, I will use my refund to buy new software for my computers which will help me in my re-training and give jobs to others.

with their misspelled signs..they're a couple of years late and a whole lot of knowledge short.

but aside from the stimulus effect, is there anything good about a tax cut when the country is running up a huge deficit? A big problem for our country is that the Republicans were successful in convincing the people that not financing our government adequately is sound policy. I hope we wouldn't make the same argument. I'd rather see us make the honest argument that tax cuts in conjuction with a deficit, while tempoarily necessary, are self-destructive in the long run. It would be an argument for fiscal responsibility. It's not an easy argument to make because people's minds have been polluted by years of Republican propaganda to the contrary. But it's the correct argument. So I'd like to see us abandon the tax cut rhetoric. It's the first step in recovery from the Republican world of fiscal make believe.

And this tax cut that ran up the deficit saved millions of American's butts when then were in financial trouble. I do think addressing such a grave problem trumps being so concerned about running up the deficit. And I'll listen to Krugman, thanks anyway.


http://krugman.blogs.nytimes.com/2009/09/28/crowding-in/

snip//

Now for the discussion. Why, exactly, do we think that budget deficits are a bad thing?

The textbook answer identifies two reasons — two ways in which budget deficits now make us worse off in the future. They are:

(1) The fiscal burden: deficits now mean higher debt later, which will have to be serviced, and that means higher taxes and/or less spending on other, presumably desirable things

(2) Crowding out: when it runs deficits, the government competes with the private sector for funds, so deficits crowd out private investment, which reduces potential growth

All this makes sense under normal conditions. But right now we’re not living under normal conditions. We’re in a situation in which the economy is deeply depressed, and monetary policy — the usual line of defense against recession — is hard up against the zero-interest-rate bound. This weakens argument (1) — and it actually reverses argument (2).