As Occupy Wall Street protestors continue to demonstrate across the country, congress’ fiscal super committee failed to craft a deficit reduction package due to Republican refusal to consider tax increases on the super wealthy. In fact, the only package that the GOP officially submitted to the committee included lowering the top tax rate from 35 percent to 28 percent, even as new research shows that the optimal top tax rate is closer to 70 percent.
Sen. Patty Murray (D-WA), who co-chaired the super committee, explained that the major sticking point during negotiations with the GOP was what to do with the Bush tax cuts. With that in mind, the National Priorities Project points out that those tax cuts this year will give the richest 1 percent of Americans a bigger tax cut than the other 99 percent will receive in average income:
The average Bush tax cut in 2011 for a taxpayer in the richest one percent is greater than the average income of the other 99 percent ($66,384 compared to $58,506).
“The super committee failed to grapple with the extraordinarily costly Bush tax cuts for the richest—tax policies that, according to the Congressional Budget Office, cost more in added federal debt than they add in additional economic activity,” explained Jo Comerford, NPP’s Executive Director. Frank Knapp, vice chairman of the American Sustainable Business Council, added in a statement yesterday, “the high-end Bush tax cuts are a big part of the problem – not the solution…It’s obscene to keep slashing infrastructure and services for everybody on Main Street to keep up tax giveaways for millionaires and multinational corporations.”
The Bush tax cuts have done nothing but blow up the federal debt and hand billions in tax breaks to the Americans who needed them least. As a reminder, past grand bargains when it came to the budget included substantial new revenues, to balance the pain of getting the country’s budget in order. Instead of adopting that approach, the GOP wants to continue lavishing tax breaks onto the 1 percent, while asking everyone else to sacrifice.