Torn Over Taxes
I usually align myself with the conservative republican way of thinking; however, on the subject of extending the Bush tax cuts I am torn. Both sides of the debate make their arguments using “facts” and “polls” which contradict each other making me lose confidence in their respective arguments. In fact I find much of their remarks to be misleading. On this issue I could really use some sound input from Dr. Tufte, especially in regards to the tax cuts for higher income individuals. As far as the lower and middle income individuals I am sure that extending their tax cuts and increasing their discretionary income will translate into increased spending. This increased spending or sustained spending will benefit the economy and help struggling Americans feel more secure and less mad at the government in contrast to what they would feel if their taxes increased. The arguments get more jumbled when it comes to high income individuals, which is considered over $250,000 in their arguments. One side says these individuals represent in many cases owners of small businesses and by taxing them more they will hire less and may even downsize more which would kill the economy and increase the unemployment rate. The other side says that these individuals represent a small percentage of small business owners and in most cases are not owners at all. It is argued by Michael Ettlinger, Vice President for Economic Policy at the Center for American Progress, that these high income individuals don’t need the tax break which will increase the federal deficit with very little identifiable economic payoff. I would suggest a compromise which would allow high income individuals tax cuts to expire while offering specific tax breaks or incentives to small businesses, of arbitrarily say 100 individuals or less, for hiring new workers or making part time employees full time. In this way tax revenues would increase and the tax incentives that are provided would have a direct impact on employment which is the overarching issue of the current debate.