First, understand that President Obama doesn't even need to participate in negotiations over extending the Bush tax breaks, because he can just let them expire and achieve a big progressive victory by restoring Clinton-era taxation on the highest earning taxpayers. But, call it Post-Election Obama Retreat I, or more of the same, now Obama aides tell Mike Allen this morning that, for families with $250K to $1 million annual income, they hope to make permanent the Bush tax breaks (which cut top earners' income taxes from 36% from 39% (except for capital gains income, which is taxed at only 15%!)). The plan is to re-define 'middle class' up, way up:
An income of $250,000 a year "is dead as the dividing line" for distinguishing the middle class in extending the Bush tax cuts, the centerpiece issue of the upcoming lame-duck session of Congress, Democratic aides have said.
Instead, negotiations will begin around a threshold of $500,000 or $1 million, the aides said.
President Barack Obama said this week that he would make a new push to protect the middle class from the tax cuts' scheduled expiration at the end of this year.
The new figures means a broader swath of Americans would be considered "middle class" during the negotiations.
We got the Cat Food (Debt) Commission bipartisanly scheming to chop into Social Security. We got 9.6% official unemployment, 17.1% real unemployment, record inequality that's getting rapidly worse, and record mortgage defaults. But hey, don't worry, we got President Hope looking out for the $250K to $1 million income earners!
Here were the income dividing lines family/household income brackets in 2007, the latest I can find clear data for (this PDF at p. 7): Top 1%: over $398,900; Top 5%: over $155,400; Top 10%: over $109,600. Looking at that, Obama aides have magically decided that 'middle class' now extends all the way to the edge of the top 0.5%? What planet, actually I know what planet they live on, Planet Campaign Donations.
Here's Robert Reich a few days before the election:
... income in America is now more concentrated in fewer hands than it has been in 80 years. Almost a quarter of total income generated in the United States is going to the top 1 percent of Americans.
The top one-tenth of 1 percent of Americans now earn as much as the bottom 120 million of us. ...
Most Americans are in trouble. Their jobs, incomes, savings and even homes are on the line. They need a government that's working for them, not for the privileged and the powerful.Yet their state and local taxes are rising. And their services are being cut. Teachers and firefighters are being laid off. The roads and bridges they count on are crumbling, pipelines are leaking, schools are dilapidated, and public libraries are being shut.
There's no jobs bill to speak of. No WPA to hire those who can't find jobs in the private sector. Unemployment insurance doesn't reach half of the unemployed.
Washington says nothing can be done. There's no money left.
No money? The marginal income tax rate on the very rich is the lowest it has been in more than 80 years. ...
Yeah, say it Robert! But then you didn't have to go the day after the election and capitulate, though I can't say I didn't expect the following from a conventional thinking loyalist:
Extend the Bush tax cut to the bottom 99 percent, but not the top 1 percent
So far, President Obama has resisted extending the Bush tax cut to the wealthiest 2 percent. Given the post-midterms realities, he should compromise on 1 percent.
But why compromise when the 'bad guys' need a veto-proof majority to get their regressive tax bill through, especially at the end of three decades and counting of mass shoveling of the bottom 80%'s wealth to the rich? And looks like Obama has done you one better, Robert, deciding also to save those impoverished folks making more than 99.0% of us but less than the top 0.5%. Oh well, forget Robert, say it Timothy Noah:
All my life I've heard Latin America described as a failed society (or collection of failed societies) because of its grotesque maldistribution of wealth. Peasants in rags beg for food outside the high walls of opulent villas, and so on. But according to the Central Intelligence Agency (whose patriotism I hesitate to question), income distribution in the United States is more unequal than in Guyana, Nicaragua, and Venezuela, and roughly on par with Uruguay, Argentina, and Ecuador. Income inequality is actually declining in Latin America even as it continues to increase in the United States. Economically speaking, the richest nation on earth is starting to resemble a banana republic.
It's just gonna get louder and louder: VIABLE 2012 CHALLENGE. Please!? (But note that Howard Dean in the preceding link also marks the uncrossable line at $1 million, showing he also lives on Planet Campaign Donations.)
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