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The $2.5 Trillion Tragedy: What America Has Given Up For 10 Years Of Bush Tax Cuts
... and Counting
Today marks the 10th anniversary of former President George W. Bush signing into law his 2001 tax cuts (he passed a second round in 2003). While doing so, Bush promised prosperity and growth, but the nation got neither.
President Bush smiles after he signed his $1.35 trillion tax cut bill Thursday, June 7, 2001 at the White House in Washington. (AP Photo/Ron Edmonds) The cost of these budget-busting 2001 and 2003 tax cuts was, as estimated by Citizens for Tax Justice, roughly $2.5 trillion through 2010. But America didn’t have to go down this route of cutting taxes and hoping for growth to miraculously appear. There were other policy options available to policymakers.
ThinkProgress, using data on various social spending projects from the National Priorities Project — which does these calculations for the cost of the Iraq and Afghan wars — has estimated ten other possible policies we could’ve paid for at the same $2.5 trillion price of the Bush tax cuts. While not all of these policies are currently performed by the federal government, they do represent an accurate calculation of the monetary tradeoffs, and each one individually would cost the same as the Bush tax cuts. Here are ten alternatives we could’ve pursued instead:
- Give 122.7 Million Children Low-Income Health Care Every Year For Ten Years
- Give 49.2 Million People Access To Low-Income Healthcare Every Year For Ten Years
- Provide 43.1 Million Students With Pell Grants Worth $5,500 Every Year For Ten Years
- Provide 31.5 Million Head Start Slots For Children Every Year For Ten Years
- Provide VA Care For 30.7 Million Military Veterans Every Year For Ten Years
- Provide 30.4 Million Scholarships For University Students Every Year For Ten Years
- Hire 4.19 Million Firefighters Every Year For Ten Years
- Hire 3.67 Million Elementary School Teachers Every Year For Ten Years
- Hire 3.6 Million Police Officers Every Year For Ten Years
- Retrofit 144.6 Million Households For Wind Power Every Year For Ten Years
- Retrofit 54.2 Million Households For Solar Photovoltaic Energy Every Year For Ten Years
The tradeoffs paint a stark picture. For the same price as the Bush tax cuts, which did little to help the economy, we could’ve sent tens of millions of students to college, retrofitted every household in America with the capacity to generate alternative energy, hired millions of firefighters and police officers, effectively ended our national shame of having kids who lack health care coverage, or put millions of more teachers into classrooms. But instead, Congress passed budget-breaking tax cuts, and then went on to pass even more in 2003. In 2010, Congress then went on to renew the Bush tax cuts for an additional two years, and the political will for the sort of public investments listed above appears to have dried up.
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71 Comments so far
Show AllWhat do we get if we add to those tax cuts the trillions thrown away on two - now three - idiotic wars over the past ten years?
q
Very unhappy rich people who wouldn't be quite so rich as they are now!
Good question! What we would get is a recession that would be manageable, that wouldn't be bankrupting states. But all three, the Bush tax cuts, wars, and the recession (the bailouts) - a ruling class trifecta - all serve the same purpose: a massive transfer of wealth upward and the evisceration of the remaining features of our society that don't serve to enrich the already rich.
Bush Jr. started it and led us down the "primrose Lane", but we haven't seen any change... Maybe it had gone too far to change anything?
In the last two years we have accumulated national debt at a rate more than 27 times as fast as during the rest of our entire nation's history... Over 27 times as fast.
If you are driving in the right lane doing 65 MPH and a car rockets past you in the left lane 27 times faster, it would be doing 7,555 MPH!
Thanks TP but your underlying assumption is wrong. You assume the US is a We society. It's not.
The real tragedy here is the 55% of Amerikans too frigging stupid to figure this out, and their slavish obedience to the television god in their living rooms [and kitchens and bedrooms and garages and cars and waiting rooms and airport gate waiting areas and etc and etc]. Kill all television. When the drug is unplugged, some of those idiots will begin to wake up. But part of this tragedy is that most of the people who read this post will not understand its truth. Addiction blinds the eyes, whether it is addiction to heroin, alcohol or television.
How right you are. Enter a room, turn on the lie machine and watch all eyes turn in reflexive obedience.
If a politician told a lie in the woods .......
would a bear shit on it?
Do bears shit in the woods?
I think we should nationalize and deport the top 400 families who are behind so much of our suffering. And their government lackies too. All three branches.
The Bush/Obama multi-trillion dollar gift to the richest few
has put 20% of us out of work. That's where our jobs went.
It is time that those who have caused the collapse of the USA to at least pay taxes!
""High marginal tax rates DISCOURAGE work effort, saving, and investment, and PROMOTE tax avoidance and tax evasion"
How do we DISCOURAGE flush corporations from employing off-shore and PROMOTE hiring US Workers? Tax cuts haven't seemed to help that outcome.
We can't have a first-world society if the populace earns third-world wages. Perhaps we could all meet in the middle instead of having a vast abyss between first-world rich and third-world squalor?
Perhaps this is our payback for assuming if the rest of the world would just adopt our ways, they too could rise to our level of consumption. Competitive Capitalism isn't so much fun as we transition to being smaller fish in a larger global pond. (And fish without sufficient domestic oil.)
Too obvious to even state what else Bush and Mellon have in common:
Mellon authored The Mellon Plan (Revenue Act of 1924), which reduced taxes for the wealthy individuals and large corporations. The plan burdened the middle and lower class, assisting the wealthy like himself, with tax relief. Besides providing tax cuts for the wealthy, he supported the development of corporate America’s wealth from the stock market. Mellon believed that the wealth from the upper classes would “trickle down” to the lower classes, causing many of his legislations to benefit the rich over the poor.... Mellon’s reinvestment and anti-tax attitude led to inflation which helped cause the poverty observed during The Great Depression.
http://pabook.libraries.psu.edu/palitmap/bios/Mellon__Andrew.html
You stated, “OverThe U.S. tax system encourages off-shoring of jobs since multinational corporations can organize subsidiaries in countries that tax profits at a lower rate than the U.S.'s 35% and can avoid paying a U.S. tax on those profits unless and until they are repatriated to the United States.”
Do you mean like Ireland – your poster country? Worked out great for them:
“Over the past two decades, Dublin reduced taxes on corporate profits to 12.5 per cent, one of the lowest rates in Europe. This approach helped lure foreign investments by some of the world’s largest multinationals. Along with financial help from the European Union, the influx of overseas investment transformed once-poor Ireland into the economic miracle touted since the mid-1990s as the Celtic Tiger.
But the boom times are long gone for the Irish, who head to the polls in a general election Friday. Now they are coping with a debt-burdened government and dismal business conditions after a recession touched off by bank failures and the collapse of a sky-high housing bubble.
The jobless rate is stuck above 13 per cent and the Irish face years of cuts in government programs and higher personal taxes. Outbound migration, long a measure of the country’s fortunes, is on the rise again.
In November, Dublin was forced to accept a humiliating $114-billion rescue package from the EU. And, to the Europeans asked to put up billions in bail-out money, Ireland’s low corporate tax rate has become a source of intense irritation.”
http://spon.ca/do-we-really-want-to-%E2%80%98look-more-like-ireland%E2%80%99-corporate-taxes/2011/02/24/
Same old stories, Nolo. And you’re spouting the same b.s.
The top 1% aren't working any harder, but they are saving more and investing more.
They are sitting on 2 trillion dollars, and they've invested in factories all over the world.
There is always such outrage when someone on welfare buys cigarettes, but the rich can gamble, steal and throw people out of work without anyone proposing that if they are that irresponsible with their money, they shouldn't be given so much.
I'm saying it now. They can't be trusted with all that money! Take it away from them and put it to good use.
People should understand that cigarettes are cheap. Most of the money paid by smokers is going right back to the government in taxes.
"America didn’t have to go down this route of cutting taxes and hoping for growth to miraculously appear. There were other policy options available to policymakers."
Liberalism surely dies hard. This article is yet another devious propaganda attempt by liberals to buttress Das Kapital as it creaks and crumbles into the 21st Century.
Das Kapital requires two political wings, the predators (Repuks) and the apologists (Demoks). The Demoks are pretending to cover the progressive end of the political spectrum by offering alternative means to economik-growath.
These alternatives are supposed to make progressives feel better. But in fact evey alert progressive reads easily between the lines and sees that we don't need economik-growath, because Merkans plunder the earth at 4x the world average rate per capita. 3/4 of economik activity in the USA is wasteful, destructive and unnecessary. 3/4 of Merkans are enslaved to Das Kapital.
And the Demoks' role is to help keep them enslaved by the progressive deception. How much longer will we allow them to deceive us? Their ideology is doomed and most of the world knows it.
Well, from my point of view not until the cord is cut to the TV and other diversions we have to keep us numb and dumb!
its the alternative minimum tax stupid
Next you want Obama to find the WMDs, right?
Did I just read or hear that 95% of Americans believe in God, making us more religious than Canadians and Europeans? If we have all of these citizens who believe in God (and probably the majority of them are so-called Christians, supposedly following the teachings of their savior Jesus Christ), why are we so greedy and selfish? Why do the countries with fewer people who believe in God not have a problem providing quality education, health care, unemployment, and retirement to their citizens? (These are rhetorical questions.)
NMlib a number of studies have shown that when you examine the relationship between a nation's wealth (per capita GDP) and religiosity, the United States is more religious than Canada, Israel, and Western Europe. Sociologists are perplexed by these findings.
Your rhetorical questions strike at the heart of a problem that has plagued Christians for centuries. Is salvation gained by faith, good works, or a combination of faith and good works. Few Christians ever inculcate the teachings of Jesus in their everyday life. Jesus didn't seem to support capitalism and free markets. In Luke 12:33 he instructed his disciples to "sell all your possessions and give to the poor". Jesus did not preach the prosperity gospel that you see being preached by huckster televangelists. He preached that it was "easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God". (Matt. 19:24) In Mark 10:23 Jesus said: "How hardly shall they that have riches enter into the kingdom of God!" The reason why countries with fewer people who believe in God do not have a problems providing quality education, health care, employment and retirement for their citizens is perhaps because those people believe in a social contract whereby the society strives to provide each member the best quality of life in this life rather than magically thinking that those who are lest fortunate will be rewarded in some afterlife.
Photius, thanks for your thoughtful--and thought-provoking-- comments. I also find it interesting that so many of these free-market "Christians" worship Ayn Rand who was an atheist.
95% of that 95% are complete PHONIES who wouldn't know or understand the word of GOD if read or spoken to them by Jesus Christ himself.
He was only following orders ;-)
"They were smart enough to throw Bush out after figuring out his multi trillion dollar gift"
You do realize a President can only serve 2 terms, no?
>>>> - Provide 43.1 Million Students With Pell Grants Worth $5,500 Every Year For Ten Years
There are only 19 million students in US degree-granting institutions.
http://nces.ed.gov/fastfacts/display.asp?id=98
The other alternative "factoids" are equally questionable.
Simpler to just state that the $250 Bn / yr could have been used to raise the standard exemption (by about $5,000) for all of the 100,000,000 US income tax payers.
Obama has been in office for over 2 years.
For the first 2 years, he had an overwhelmingly Democratic Congress.
Well. That was embarrassing! How to explain the continuation of Bush policies?
Luckily for the Democrats, the 2010 election gave the House to the Republicans, starting in January, so the Democrats promptly continued the tax cuts in December, telling us it was because the Big Bad Republicans were coming and made them do it!
And this author tries to call them the Bush tax cuts.
George W Bush Tax Cuts when the GOP was in power. HO HO HO!!!!!!!
They are back again and with the great American Wars.
We went from a surplus to a money bust.
The GOP has never been a progressive group but they get a A+ for Regressive Ugly Politics.
I estimate former President George Bush still has something like three tonnes of lipstick left on his dick. Someone contact the Guinness Book of Records.
Trylon
Look at the inset picture accompanying this blog. Those gathered around the chortling Bush Boy are all fat, happy, white folk who appear to be self-satisfied and, not to belabor the point, well fed. House members perhaps, although that looks Harriet Miers behind W. What have they done for their nation and their fellow citizens of that nation during the intervening ten years. My guess is -- nothing, zilch, nada of any worth.
We probably would have also avoided the bank bust in 2008 and not needed TARP. Bush & Co. and all of his congressional supporters broke the economy and broke the nation. They should be ashamed. And maybe tried for their crimes and imprisoned.
Instead, the Republicans aided by the Republican owned media are trying to blame this all on Obama.
One of the better republican candidates for president, Tim Pawlenty, just unveiled his economic plan: cut taxes HUGELY. No more taxes on estates, dividends, capital gains... Now why is it that there's no difference between dems and repubs? I kind of forget.
"One of the better republican candidates for president..."
There is no such thing.
One of the least worst?
Democrat, Republican, liberal, conservative....
..moot terminology, with no bearing on reality......
Marx was wrong...
...Television, not religion, is the 'opiate of the masses'.....
Clinton, Obama, Bush 1, Bush 2, etc, etc, etc........
they are replicant-tigers with different stripes....
They are self-aggrandizing, political-neanderthals, or irrelevant ''statesmen''...
...... predators in sheeps clothing, absorbed primarily in the latest opinion poll.....
.............
Bill Clinton RAISED taxes on the rich, CUT military spending, created 3 TIMES AS MANY new jobs per year as Reagan/Bush I/Bush II, and transformed the Reagan/Bush deficits into SURPLUSES. Cut the crap!
The Bush tax cuts are now the Bush/Obama tax cuts! Obama had Democratic majorities in both the Senate and House when he caucused with Senate Republicans (while keeping Democratics in the dark) to craft a bill preventing Bush's tax cuts from expiring.
And the Bush tax cuts only passed in the Senate because enough Senate Democrats voted for the tax cuts to provide a majority vote in the Senate. The "Bush" tax cuts are really the "Bush era" tax cuts since the legislation only passed because enough Democrats voted for it. Meanwhile, the "Bush" tax cuts myth lives on and I'm sure the Democrats loved not getting the blame; that is, until Obama and the Democrats extended and expanded the cuts themselves.
The Bush tax cuts are not a myth. Bush was a Reaganomics, supply-side imbecile, he wanted the cuts, he got them, and he gets the blame for the results. Ditto Obama for extending them.
I didn't say the cuts are a myth. The myth is that the cuts are all attributable to Bush as the Democrats assisted in passing the legislation during Bush's term. To assign all the blame to Bush when the Democrats assisted in passing the legislation is simplistic and inaccurate. It is like singularly blaming Bush for the Iraq war, when the Democrats were supportive of that and promoted attacking Iraq before the war started.
As far as Bush being a supply-side imbecile, I agree he was an imbecile, but I don't believe most Republicans power-players actually believe in supply-side economics, rather, they just use the failed theory to push legislation to reduce their levels of taxes.
I blame Bush and I blame Obama. I think it's simplistic to try to spread the blame around, or give the impression that politicians are all alike, or Democrats are all alike, or that differentiating between individual politicians is a futile task.
Bush was driving the bus. It's considered proper (at least among Dems) to give the newly elected president some non-partisan support. The blame for the tax cuts goes far more to Bush than those Dems who OKed the new prez's priority legislation. And, foolish as it was, the bill DID have a sunset clause — it was a temporary tax cut.
Then along comes Obama eight years later. The Clinton peace and lower military spending are gone; war and massive military spending have returned. Clinton's robust job growth is gone and massive unemployment has returned. The so-called justification for the tax cuts — the Clinton budget surpluses — is long gone, and massive deficits have returned.
So what does Obama do? Does he dump Reaganomics and return to tried-and-true Clintonomics (which created 3 times as many new jobs as the tax-cutting, supply-side policies of Reagan/Bush I/Bush II)? No. He huddles with the MINORITY Senate Republicans (in meetings closed to Democrats) and makes a deal to pass a bill to PREVENT the Bush tax cuts from expiring!
I blame Obama — not all Democrats — for that! Don't bother telling me that some Democrats voted for it. I know! It's party loyalty and it stinks. But what should Pelosi and Reid have done? Publicly broken with their party's leader? Called him a Republican in Democrat's clothing? Called him a venal, corrupt and stupid man? Admit they were wrong to have ever looked favorably on his candidacy? Called for his resignation? They, like so many voters, have been gut-punched and painted into a corner by this fake Democrat who pursues Republican policies as a Democrat.
And, by the way, I also singularly blame Bush, Cheney and the rest of that gang for the Iraq War. They lied to the public, the press and Congress, presented manufactured evidence to the United Nations Security Council, and exploited the 9/11 furor to sell the Iraq War. Voting against giving Bush the authority to take military action under those circumstances would have cost some congressmen their seats, only to be replaced by completely sycophantic war mongers. (Of course, corporate media gets a big piece of the blame. They abdicated their responsibility and allowed that snow job to happen!)
And, Iraq is another issue on which Obama is mirroring Bush, again, even after the truth has come out. Now that we KNOW Iraq had nothing to do with 9/11 and had no WMD, there's no excuse for Obama to continue Bush's Iraq timetable. Yet he does.
The amazing thing is the sheeple out there who still firmly believe the mantra of "cutting YOUR taxes" and that it applies to them; it applies to the fat cat corporate oligarchs standing behind them, laughing all the way to their (offshore) bank. The little guy (that's me and you) get screwed over big time, and the schleps who are dirt poor get it in the rear even worse. But still, they go on believing this crap. It reminds me of a song...
"...tax the rich,
feed the poor,
till there are no,
rich no more..."
I think the time has truly come for that approach. Call me a commie/socialist/whatever-I'm tired of seeing the working man getting screwed, whether by Bush or Obama.
USA Today wrote that every American owes $550,000 dollars as part of the national debt. They broke it down to include all non-defense government expenditures in Medicare, Social Security, etc. Not a word about the war profiteering MIC budget that is over half of all government expenditures.
Make the rich pay taxes!
I wrote this in response to nolo, but it appears as his two posts disappeared. Still posting it in case it mysteriously reappears.
nolo,
"That, and the lower salaries and other compensation paid to non-U.S. workers, offers a powerful incentive not to create U.S. jobs. The more we burden employers with mandatory costs for health care, pensions, etc., the more we incentivize employers to look outside the U.S. for workers. Unions in the United States raise the salaries of those who remain employed, but at the same time, they reduce the competitiveness of companies that have unionized work forces. Thus they promote an exodus to "right to work" states like South Carolina and to offshore locations."
Succinct and to the point. Unfortunately you don't seem to draw the proper conclusion from your own very well stated summary of the problem. The answer isn't to "free" business from the "burden" of providing a living wage, the answer lies in once again regulating trade, both international and interstate.
Except for these trade agreements, there's absolutely NO reason we shouldn't once again have tariffs and regulate which businesses are allowed to operate or even which ptoducts are allowed to be sold within the United States.
Perhaps the biggest con of the past 30 years or so is the notion that international trade can ever be FAIR without heavy regulation by the government (The people in case you forgot). Tariffs aren't new nor are they a bad thing. They're designed to do several things. Protect the domestic worker from essentially slave labor, protect the environment by ensuring environmental costs are taken into account, and to protect domestic manufacturing. Protectionism IS NOT A BAD WORD.
As far as interstate commerce goes, it wasn't all that long ago that banks weren't allowed to operate nationwide. As recently as the late 1990's as a matter of fact. There's no reason we can't abolish the practice of our corporations chartering in states such as Delaware or overseas simply because they have corporate friendly charter laws. Take a look at the Silicon Valley titans who's headquarters are in San Jose or Santa Clara and then look where they're chartered and tell me how one can call them a California business. Of course this means we would actually have to REGULATE business. Something you're apparently not willing to do.
As far as burden of health care, I agree that its a burden on business. Its also a much greater burden on the people. You want to free business of this undue burden? Then get your head out of your behind and advocate for true national health care for each man, woman, and child. Take the burden away by abolishing the parasitical health care insurance industry.
As for retirement being a burden. All I can say is, "Are you f'ing serious?" If retirement was such a burden as you suggest then the corporate executives wouldn't be getting retirement packages worth millions, sometimes hundreds of millions of dollars. No, it seems that to you only the piddling one or two thousand a month that the workers get is a burden. A hundred million golden parachute for a crappy CEO after just a few years - no problem for business. Twenty four thousand a year after 25 or 30 years work - Yikes! Can't have that. No siree, can't afford it.
In your first post you claim the Regan tax cuts resulted in a booming economy. How so very typical of so called conservatives. Ignore the fact that this "saved" money fueled the savings and loan fiasco and the commercial real estate bubble. That it pumped up the stock market (which isn't the economy). That it resulted in MASSIVE government deficits adding to the debt. Deficits people like you NOW claim have to be addressed by slashing government that provides for the people's needs.
The only thing you seem to advocate for is for both business and the rich to have NO rules so that they can reduce the people to abject poverty in order to increase their own wealth and power.
Go sell it somewhere else, 'cause we're not buying.
Sorry Krazy but that ship is at the breakwater and without manditory and exclusive public financing of campaigns it willl be over the horizon before the inmates in the congressional asylum will even notice. Hell, they are distributing the keys to the cells as I write.
Les miserables has some good moments that might apply.
Naturally,
don't forget Clinton's, NAFTA craft-work.... a travesty for American labor...
or his policy w/Iraq, in the form of a UN-medical embargo and no-fly zone.
..this sacrificed many, many thousands of Iraqis, rather than disturbing Saddam...
It inflamed the Muslim world.
..setting us up for our yet unfolding, military disaster in the Tigres/Euphrates River valley....
...and beyond.....
He deliberately allowed Osama to freely exit from the Sudan, to flee to the Pashtun mountains of Afghanistan,
he initiated the technology-transfer of computerized, weapon/systems with China, and invaded the Balkans in another killing field....
and lied, in an utterly, bold-face to America, and the entire world, via television, about his obsessive, sexual/marital transgressions....
Don't elevate Slick Willy's pedastal too highly....
Just ask Monica, Juanita, etc., etc.,..or the one who got him impeached
finally..
..what was her name ?....
He dropped his pants for her...the ''big creep'' couldn't resist it, apparently....
there are just too many 'hussies' to remember, I guess....
OK, so he lied under oath.....so what, all politicians lie, don't they....
As they say on Oscar-night, what a great actor!....
[Like ray-gun Ronnie Reagan]
The only reason the Repubs took over the white house was America was tired of
being laughed at and scandalized.....The freakin' Clintons even tried to make off with some of the white house art/decor.....
Real winners......
Yeah, and I won't forget that brantcloyd is a Republican sleaze.
http://www.facebook.com/pages/George-W-Obama/198592273491302?sk=info