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Raising taxes won’t cure the recession

With the election season approaching and the Republicans just beginning the process of choosing their nominee to oppose President Obama in 2012, charges and countercharges are flying on all the issues. One thing I’m not hearing a lot of is specifics.

I remember Nancy Pelosi saying a couple of years ago that Mr. Bush’s economic policies had caused the recession. She didn’t bother to say which policies had caused the mess. In other words, no specifics. Another issue featuring a glaring lack of real information is the tax code and whether the “rich” should pay more ... their fair share (what is their fair share?). Here are some specifics from 2008 (I understand this is the last year data is available), according to the IRS.

The top 1 percent of all wage earners in this country were those reporting an AGI of more than $380,354. According to the IRS, this group of taxpayers (1,399,606 total) paid 38.02 percent of all federal individual income tax collected in 2008. The top 5 percent of wage earners (those making more than $159,619) paid 58.72 percent of all federal income taxes. Let’s cut it down further. The top 0.1 percent of wage earners, approximately 140,000 taxpayers with an average income of $6 million, paid 18.5 percent of federal income taxes.

In 2000, before the Bush tax cuts (those supposedly “for the rich”), the top 20 percent of wage earners paid about 81.2 percent of federal income taxes. In 2004, after those tax cuts for the rich, the top 20 percent of wage earners paid a greater percentage of income taxes, 85.3 percent. The Bush tax cuts actually shifted the tax burden in this country further toward the rich.

The fact of the matter is that raising taxes on the rich will not get us out of the recession. That’s not the answer. It sounds more like what some congressional Republicans called it ... class warfare.