David Cay Johnston Explains How Your Taxes Will Go Up Under The Obama/GOP Tax Cuts

[democracy1st]

AMY GOODMAN: Well, David Cay Johnston, talk about the legislation that the Senate is poised to pass today.

DAVID CAY JOHNSTON: Well, you certainly cannot accuse the Republicans of leaving any money on the table. They got an extraordinarily good deal, that raises, I think, basic questions about the negotiating skills of the President. The bottom roughly 45 million families in America or households in America—and there are a little over 100 million households—they’re going to actually see their taxes go up. And that’s because President Obama’s Making Work Pay credit—$400 per person, $200 for a couple, and you got it even if you were retired or disabled—is going to go away. And it’s going to be replaced by this temporary two percent reduction in the payroll tax, the Social Security tax. Well, for about 45 million households who make less than $20,000 a year, this is a tax increase of $150 to $200 each. So, it certainly seems to me it’s reasonable going forward, given how the Republicans have emphasized they will never raise taxes on anyone and they are the party of tax cuts, that the Republicans have now become the party of tax increases on the poor.

At the top end, if you’re a two-income couple and you make a little over $100,000 each, so you pay the most Social Security tax, you didn’t get Obama’s Making Work Pay credit. You were regarded as too well off. But that Social Security payroll tax decrease is going to mean about a $4,200 tax cut for you. So, clearly, we could see the scheme of this is: the better off you are, the more help you get from the government; the worse off you are, your taxes go up.



AMY GOODMAN: How do the Republicans—well, and the Democrats who are supporting this, overwhelming support now in the Senate—explain the deficit? I mean, when you’re talking about—how much money are we talking about this will increase the deficit by, $826 billion over the next decade?

DAVID CAY JOHNSTON: Well, I think it will be very interesting, Amy, to watch Fox News. I have a number of times in my column pointed out polls they commissioned but then did not talk about on the air, because they didn’t fit the ideology that Fox News is promoting. I suspect you’ll hear a lot less about the deficit. And if you do, it will now be Obama’s deficit, not the deficit of George Bush, George H.W. Bush and Ronald Reagan, who ran up three-quarters of our federal debt, but Obama’s deficit. And what the President has given away is a trend line that would have been a shrinking federal deficit going into the future. How this will play out in two years will be very interesting to watch.

AMY GOODMAN: David Cay Johnston, when we’re watching television, tell us what are the bullet points to watch for of the misrepresentations or outright lies that the journalists continually reiterate when talking about this.

DAVID CAY JOHNSTON: Well, failing to report that this is a tax increase on the bottom roughly 45 million households in America, close to 150 million people, that’s number one. This is a tax increase for those people. Secondly, that the more money you make, the bigger your tax cut under the Republican plan. Thirdly, that the estate tax reductions to 35 percent and a $5 million, or for a married couple $10 million, exemption involve money, in many cases, that has never been taxed. When very wealthy people die, the reason they’re wealthy is they’ve reported, legally, less income than they made on an economic basis, so they have lots of money that was never taxed. And now it will never be taxed, up to $5 or $10 million, because of these changes. And those are key things that I would watch for.

The other one is, we’re going to cut spending. Well, there are only four big areas of federal government spending: interest, which is low right now because interest rates are low, that will go back up; the military, the Republicans are not exactly known for wanting to restrain military spending; Medicare, Medicaid, that is, government-provided healthcare for the elderly, the disabled and the poor; and then Social Security, which people paid into and expect to collect in their old age. So what are they going to cut? Are they going to cut food safety inspection, which is a tiny, tiny fraction of a penny, and worsen a situation in which food-borne illness occurs in this country at something like—I think it’s 20 times the rate in France and seven times the rate in England? Are we going to further take away education from poor children? Are we going to raise the cost of a higher education, which reduces the value of the most valuable asset we have—young minds, that we should be training and developing so we have a prosperous future?

http://www.democracynow.org/2010/12/14/the_worse_off_you_are_your

Investigative Journalist David Cay Johnston Slams Obama-GOP Tax Deal on Democracy Now!

Part 1 http://www.youtube.com/watch?v=HG9TPqrz5ic
Part 2 http://www.youtube.com/watch?v=s-vrGjxR_60

It’s Scary Out There in Reporting Land
‘Beats are fundamental to journalism, but our foundation is crumbling.’
By David Cay Johnston

http://www.nieman.harvard.edu/reports/article/102499/Its-Scary-Out-There-in-Reporting-Land.aspx

http://demandsideblog.blogspot.com/

[DrDan]

1. facts and details vs sound bites - sad, but Americans do not process issues that take more than 20

words to explain.

Democracy is probably the worst government model for us at this point in history.


and the R's are vasty superior to the D's in putting these bumper-sticker positions in place
- death tax
- death panels
etc

[chimpymustgo]

2. "When very wealthy people die, the reason they’re wealthy is they’ve reported, legally, less income

...than they made on an economic basis, so they have lots of money that was never taxed. And now it will never be taxed, up to $5 or $10 million, because of these changes."

I swear, I could just smack these liars who insist we have to support this shit - and the sycophants who support them.

[DrDan]

3. I agree - the idea that these large estates ($2-5M) will be passed along

with much of the estate never having been taxed is not one that was forgotten, or unknown to the administration.

Just more sucking up to this constituency.

[progressoid]

4. Smack away.

I won't stop ya.

[BeFree]

5. Eh?

Working man's taxes go up, rich man's taxes go down?

That's messed up, man.

[chimpymustgo]

6. Class warfare, man. Too bad our general is fighting against us.