tax cut
THIS TAX DAY, some middle-class Americans may be tempted to celebrate. Under the new law approved in December, the bottom 60 percent of earners (those making less than $86,100 a year) are expected to receive 2018 tax cuts worth $407 on average.
But if you think you’ll be among those who owe Uncle Sam less under the new law, don’t get your party hat out yet. These tax cuts come at a high price.
For example, a typical preschool teacher (single, with no children) who makes $30,000 per year can expect a tax cut of $457. That’s enough to pay for a new refrigerator or several months of electricity bills. But other changes to the tax code could put this teacher’s job in jeopardy. State governments have been expanding pre-K programs in recent decades, but many of them are expected to have their education budgets squeezed because of the new tax law’s caps on state and local tax deductions.
In the meantime, the preschool teacher could have more hungry children in her classroom. The new tax law reduces incentives for charitable contributions, including for food banks and other services that early-childhood programs rely on. Donations to nonprofits are expected to drop by as much as $20 billion this year, according to the Tax Policy Center.
What about middle-class families who are making significantly more than the typical preschool teacher? Let’s look at a couple who run a plumbing business in Louisiana, with $135,000 in joint income. The Tax Policy Center estimates they’ll get a tax cut of $609 in 2018. But that same couple can expect to be slammed with a spike in their health insurance premiums of $1,900—triple their tax cut! That’s because the new tax law repealed a key part of the Affordable Care Act that requires individuals to have health coverage if they can afford it. This could lead to an estimated 13 million more people becoming uninsured and huge increases in premiums for those who remain in the individual market.
These are just some of the immediate effects of a tax law that overwhelmingly favors the wealthy and big corporations. In the longer term, the costs to working families will be much more painful.
At Europe Through the Back Door, our tour program just sold its 11,782nd seat for our 2011 season -- topping our best tour sales year ever (2007). Despite our antsy stock market and doom-and-gloom news stories, it seems that our economy is gaining some confidence. And yet, at the same time, our local symphony and arts center are in financial crisis.
As a way to celebrate, to give back to my beautiful hometown of Edmonds, and to spark a little conversation about why a society as affluent as the USA is cutting education, neglecting our environment, and defunding the arts while our wealthy class is doing better than ever, I've decided to make a donation of $1 million (in $100,000-a-year payments over the next decade) to our local symphony and arts center. This sum represents the money I've gained in the 10 years since the Bush tax cuts for the richest Americans (those of us earning over $250,000 a year) took effect.
Picture this: Hundreds of thousands of women, men, and children plod across barren cracked earth. Dead cows and human corpses litter the roads, revealing to us evidence of two things: 1) the hottest summer on record in Somalia, which caused the worst drought and famine in 60 years; and 2) twenty years of a truly failed Somali government swallowed up in cycles of violence.
Picture this: Posturing politicians claim to stand up for the rights of Americans, even as they hijack the proverbial steering wheel of America. They hold a proverbial gun to the heads of every American, and say outright that they'd have no problem driving us all off a proverbial cliff if millionaires and billionaires don't remain protected from raised taxes, and if we don't cut more programs that protect working and poor people.
The hunger fast for a moral budget has gone spiritually viral. Ten days ago, we announced at the National Press Club that the budget debate had become a moral crisis.
If a budget is a moral document, what should be said about the president's proposed budget for 2010? I focus here on what this budget proposal says about justice for poorer Americans.
While watching President Obama's press conference Tuesday evening, I was struck by a few things that are often forgotten in the criticism of his proposed budget.