The Bush tax cuts are scheduled to expire in January. President Obama has expressed a desire to preserve the cuts for the middle class while letting tax rates for the wealthy reset to where they were during the Clinton administration. Conservative lawmakers and pundits have been fearmongering that allowing the tax cuts for the wealthy to expire will kill job creation and small businesses (despite the fact that fewer than 2 percent of small business owners will be affected). Last night on CNBC, Wall Street Journal editorial board member Stephen Moore went so far as to say that he can’t “see the sense” of allowing cuts for the rich to expire, and then advocated that taxes be raised on the poorest Americans in order to finance more tax cuts for the rich:
I just don’t see the sense of this. In fact, if I could have my ‘druthers, I’d raise the ten percent tax rate to fifteen percent and lower the [top] rates.
Adopting such a plan would only exacerbate income inequality that is already the worst it has been since the 1920’s. According to the latest data, “the gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled between 1979 and 2007.” The top 1 percent of families now receive nearly 25 percent of the country’s income, after earning less than 10 percent in the 1970s. This year the Bush tax cuts will give millionaires more in tax breaks than 90 percent of Americans will make in total income.