Tax cuts that were signed into legislation by President Bush in 2001 and 2003 will expire next year, unless Congress votes to extend them.
President Obama has said that he favors extending the tax cuts for individual taxpayers who earn less than $200,000 per year and households that earn less than $250,000 per year.
Not surprisingly, our politicians are split—generally speaking—on whether these tax cuts should be extended or allowed to expire. Democrats are in favor of letting the tax cuts expire, while Republicans are in favor of extending the tax cuts for a period of time. Both parties, depending on the issue at hand, express concern about our massive budget deficit.
I am in favor of letting the tax cuts expire for all but the wealthiest citizens. We have a progressive tax system, and it is easy to forget that not all of our taxable income is paid in the tax bracket that we fall under.
The tax brackets for 2009 are 10 percent, 15 percent, 25 percent, 28 percent, 33 percent and 35 percent. A single filer, whose taxable income is $85,000, would be in the 28 percent tax bracket. This does not mean that 28 percent of their taxable income would go to the government. Instead, 10 percent up to $8,350, 15 percent up to $33,950, and 25 percent up to $82,250 would be taxed. The remainder of their income is taxed at 28 percent.
Even if Congress chooses to extend President Bush’s tax cuts for all but single filers who earn more than $200,000 per year and households that earn more than $250,000 per year, the wealthiest would still benefit from the extension that most Americans will enjoy.
One of the most enduring myths of American culture is the idea that the individual is the supreme master of his fate. I love this idea but I recognize that it is just a myth. True, we have free will that we exercise on a day-to-day basis, but whether we like it or not, we also depend on each other. The budget deficit is our problem.
I am not under the impression that our massive budget deficit will be substantially reduced with the collection of more taxes, as the Democrats would hope. But letting President Bush’s tax cuts expire for our wealthiest is a step in the right direction and a far better way to do it than by denying unemployment benefits to those who have been hurt the most by the lack of ethics and incredible amount of greed of some of our wealthiest citizens. Those who have benefitted the most from all that this country offers—whether it was through hard work, good luck or, more likely, a combination of the two—are in a better position to help than those who are middle class or unemployed.
