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Rep. McMahon Pushes To Extend All Bush Tax Cuts: Earning $250K ‘Is Barely Making Ends Meet’

Rep. Mike McMahon (D-NY)

Rep. Mike McMahon (D-NY)

There has recently been a slew of conservative voices arguing that the Bush tax cuts for the wealthy should be extended because $250,000 in yearly income is really not that much money. For instance, Fox News’ Martha MacCallum said “people who make $250,000 — in some parts of this country, they may not consider themselves rich,” while CNN’s Karin Chetry added that “some would argue that in some parts of the country that [$250,000] is middle class.” Republican National Committee Chairman Michael Steele even said “trust me, after taxes, a million dollars is not a lot of money.”

But this line of reasoning is no longer the sole property of conservative commentators. Rep. Mike McMahon (D-NY), who is one of the House Democrats joining the charge to extend all of the Bush cuts, had this to say:

“I think it is a political liability because it’s a [bad] policy right now for the economy and could have a bad impact on jobs,” said McMahon…“A working couple making $250,000 is barely making ends meet,” he said, adding, “If you have a partnership or an S. Corporation you are definitely affected… As professionals or shop owners or restaurant owners, you get hammered.”

Now, to be fair, McMahon’s district — the New York 13 — encompasses parts of Staten Island, where there are sure to be some well-off families. It’s also New York City, so the cost-of-living is one of the highest around. But still, median income in the district is $60,137. So families in his district that are making $250,000 are still doing very well.

In fact, as Daniel Gross pointed out, “$250,000 puts you in pretty fancy company, especially after the collective pratfall the economy took in 2008″:

The Census Bureau last summer reported that real median household income was $50,303 in 2008, down 3.6 percent from 2007. It’s likely that figure fell further in 2009. So a household that’s making $250,000 today is making about five times the median…And even if you look at the wealthiest metropolitan areas — Washington ($85,236), San Francisco ($76,068), Boston ($70,334), and New York ($63,957) — a quarter of a million dollars a year dwarfs the median income.

Less than 2 percent of the country makes more than $250,000, and you literally need to begin looking at individual neighborhoods to find parts of the country where that much money is not going to cut it.

The point here is not to demonize the rich, but to note that, in a time of economic hardship and worrying long-term deficits, we have to look at raising revenue from somewhere, and letting the Bush tax cuts expire for the very wealthiest makes sense. In fact, as the Center on Budget and Policy Priorities found, allowing these cuts to expire “will avert $826 billion in added deficits and debt over the next ten years.”

And as for McMahon’s charge that small business owners will be affected, the numbers haven’t changed: less than 3 percent of Americans who collect any business income at all (whether from a small businesses or a corporation) will see their taxes affected by the expiration of the Bush tax cuts.

Can The Senate Address The Full Scope Of The Unemployment Problem?

Last month, the unemployment rate fell to 9.7 percent (even as 20,000 more jobs were lost in January) and the wider U6 measure of underemployment fell for the first time in months to 16.5 percent. While those numbers do reveal the beginnings of a stabilization in the labor market, according to Kirsten Downey, a former economics reporter at the Washington Post, they also vastly understate the extent of the employment problem, because of who the statistics do not include.

In fact, she wrote, while policymakers are celebrating the avoidance of a second Great Depression, the standard measures of unemployment reveal very little in terms of good comparisons to the 1930′s:

Now, the federal government says we have an estimated 14.8 million unemployed, out of a work force of about 154 million. But that number is artificially lower than in the Great Depression because 33 million senior citizens are on Social Security — and not seeking jobs as they were then. An additional 7.4 million adults receive disability payments under Social Security, and some would also have been seeking work in 1933…We have a far larger standing military than in 1933 — about 1 percent of the work force, or 1.4 million men and women…In other words, 43.4 million people are paid for government employment in the military, or supported through government programs. If added to the jobless numbers, it equals about 58 million people.

Of course, I think it’s kind of silly to throw the military into this pot, because they’re government employees like any other. (Why not include employees of government agencies?) Also, it’s a vindication of the Social Security system that seniors no longer have to be out looking for work.

But the point remains that we have a significant unemployment problem that is not fully explained by the simple unemployment rate. For instance, the unemployment rate for African-Americans is a stunning 24.3 percent. Only two-thirds of adult men have a job at the moment, which is the fewest since World War II. And long-term unemployment hit another record last month, as “over 41 percent of the unemployed have been looking for a job for 27 weeks or more.”

longterm

All of which points to the necessity of Congress acting on a new jobs bill quickly. Majority Leader Harry Reid (D-NV) had hoped to bring legislation to the floor as soon as today, but the snowfall that buried DC has delayed action for now. Sen. Orrin Hatch (R-UT), meanwhile, has signaled that the Senate bill could garner some bipartisan support, telling CongressDaily “”I think my colleagues should support it…It’s basically a set of ideas that they can live with.”

But as Rep. George Miller (D-CA) said last week, all of the jobs proposals before Congress at the moment are likely to be “inadequate to the scope of the problem.” Indeed, as David Madland wrote, “to give a sense of how big this jobs hole is, we would need to create 350,000 jobs per month for the next 24 months just to recover what we have lost since the recession began, and that’s not even compensating for population increases.” That’s a big hill to climb, and as of right now, the Senate doesn’t seem willing to step up in a way that will make enough of a difference.

The Right-Wing, Pro-Business Advocacy Ad That Went Unnoticed During The Super Bowl

While people were focused on the fact that CBS allowed a pro-life advocacy ad by Focus on the Family to play during the Super Bowl, another one by a right-wing group slipped in unnoticed: a “Defeat the Debt” ad showing schoolchildren pledging allegiance “to America’s debt, and to the Chinese government that lends us money.” Watch it:

This ad has run on other national networks and is part of a campaign by the Employment Policies Institute (EPI) that has featured full-page ads in national newspapers and a billboard in Times Square. EPI is a project of right-wing, pro-business lobbyist Rick Berman, also known as “Dr. Evil.” Berman is “one of Washington’s most notorious PR operatives,” who uses his firm, Berman and Company, to fund non-profit front groups for his clients.

Over the years, Berman has gone after Mothers Against Drunk Driving, PETA, and right-wing bogeyman ACORN, and tried to convince Americans that healthier foods, raising the minimum wage, stopping smoking, getting rid of mercury in fish, and unions are bad for them. Berman refuses to reveal his clients, although in 2007, CBS’s 60 Minutes revealed that they included Coca-Cola, Tyson Chicken, Outback Steakhouse, and Wendy’s. According to the watchdog group CREW, Berman “runs at least 22 industry-funded projects, such as the Center for Union Facts, and holds 23 “positions” within these various entities.” Watch Rachel Maddow’s November 2009 report on Berman:

The New York Times reported that EPI, “a conservative research group with close ties to business,” launched its campaign last fall and planned to spend approximately $5 million.

Until recently, CBS and other networks said they had a policy against airing advocacy ads during the Super Bowl. In the past, ads by groups such as MoveOn.org, the United Church of Christ, and the pro-marriage equality group GetToKnowUsFirst.org were rejected (even though networks have selectively decided to air other advocacy ads). This year, CBS controversially decided to accept a pro-life ad from Focus on the Family, saying that it had changed its policy and was willing to accept appropriate advocacy ads.

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