Today marks the 10 year anniversary of President George W. Bush singing what was the first of several tax cuts that would drive the national economy into deep amounts of debt.
Republicans describe the Bush tax cuts as a way to encourage economic growth and create jobs. However, their true aim is to give tax breaks to corporations and the super rich at the expense of working American families. The average tax cut for those making over three million dollars a year was $520,000, 450 times larger than that of the average middle income family. The bottom 20% of income distribution received only a 1% share of the tax cuts and 75% of low income families saw no reduction at all.
For his efforts, the President’s record touts the worst wage and salary growth, as well as the worst total compensation growth of any postwar economic expansion. President Bush’s economic expansion is the only in which population to employment ratio did not rise. It is clear that the working class received the short end of this deal as the economic benefits failed to trickle down. The nation’s bottom 90% of earners were left with just 13% of total income gains, while 24% of income gains were garnered by the top .01%.
The cost of these cuts has been the number one driver of the national debt. From 2001- 2010 the Bush tax cuts added $2.6 trillion, accounting for nearly 50% of the entire debt during this period. This cost will only rise if the tax cuts are made permanent, in such a scenario a total cost of $5 trillion is projected to be added over the next decade.
Today, the focus for Republicans continues to be creating economic benefits for the richest Americans. In 2010 the tax on large estates was repealed for the first time since 1916, it was a reinstated in 2011 with a $5 million exemption and extremely low 35% rate. Failing to tax large estates allows the top 1% of income distribution to control 35% of the nation’s wealth, while the bottom 80% control a mere 13%. Right now 400 individuals in America have more wealth than the sum owned by 50 percent of all Americans.
During the Bush years average incomes dropped and unemployment never saw a return to pre-recession levels. Additionally, Bush tax cuts only generate 35 cents for every dollar in forgone revenue, while tax policies like the Child Tax Credit enacted under the Obama Administration generates $1.38 in comparison. By targeting high income individuals who are highly unlikely to spend extra income on job creation, the Bush era inhibited economic growth and pulled the rug from out under the middle class. The people of this country deserve a fair tax code that will help strengthen the working class and provide quality jobs with decent wages.
The legacy of the Bush era economic policy manifests itself today as Republicans attack investment in education, infrastructure, health and social security to pay for these cuts. The 10th anniversary of these tax cuts should be a reminder that the American people are financing corporate tax giveaways. This is especially shameful at a time when corporations boast record profits and working families struggle to make ends meet from day to day.