The Case For Keeping the Bush Tax Cuts

A huge political battle is brewing in Congress – whether or not to let the Bush tax cuts expire. According to the New York Times, the battle could set fiscal policy for years to come – as it’s expected to be a huge election topic.

The Democrats are prepared to let the tax cuts on the wealthy expire, but to keep the cuts on other income brackets at their current levels. That would mean that individuals and couples making less than $200,000 and $250,000 respectively wouldn’t see their taxes increase. All others above this level would.

As the political battle is set to wage, what would the implications of letting the tax cuts expire be?

Almost all Republicans and a few Democrats agree that simply letting the cuts expire now, while the economy is still weak and fragile, would only make matters worse – and I agree with them. Credit is still tight, money isn’t exchanging hands nearly as fast as it could be, and jobs are still hard to come by – and all three of these problems are related. The last thing this country needs right now is more taxes.

The top earners are, for the most part, those who own the companies that create jobs in this country. If taxes were lowered for them, the credit crunch would not be nearly as potent as it is in keeping jobs away from our economy. In short, if businesses have more money, they can hire more hands.

President Bush’s tax cuts are set to expire by the end of the year, and if Congress doesn’t act decisively now, the entire economy could suffer.

As a case in point, a blogger on the internet pointed to the yacht taxes of the mid-90s. In his words, once the tax was levied on yachts, the selling of yachts predictably dropped – which meant that dock hands and marines suffered too. There was a decreased demand for these services, and the shipbuilding business tanked as well. The tax was quickly repealed. This example shows how taxation on the wealthy can adversely affect all others within different tax brackets.

That’s my take on it, but what do you think? Gimme some comments!

View the NY Times article here: http://www.nytimes.com/2010/07/25/us/politics/25tax.html

And the blog here: http://freakonomics.blogs.nytimes.com/2010/08/13/do-tax-cuts-for-the-rich-help-the-poor/

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Chris Buchheit

Chris Buchheit was born under the hot Floridian sun during some year in the 1980s. There he studied school matters until moving to North Carolina in 1999. Possibly due to the fact that his mom had enough of him being inside all the time, he quickly got involved in community affairs via the Boy Scouts of America, where he learned the values of citizenship, morality, duty to God and country, and that the biggest kids get to boss around the smaller ones. Chris attained the rank of Eagle Scout in 2004, and still values the rank as one of his proudest achievements. Beginning in 2006, Chris began attending the University of North Carolina at Chapel Hill, where he quickly learned the value of basketball and poplar trees. Since attending UNC, Chris has been double majoring in Asian Studies, with a concentration in Chinese, and Political Science. When he isn’t slaving over his honors thesis, looking up a bunch of Chinese Characters, volunteering, or mindlessly browsing the same websites over and over, Chris enjoys writing short stories and novels. Much to his roommates’ annoyance, he also spends his free time learning to play the guitar. Above all else, though, Chris values God, his family, and his friends. For the future, Chris plans to apply to Georgetown to further his studies in Political Science, hopefully with a concentration on China. Pending acceptance into Georgetown, Chris would like to study while gaining professional experience in a government job in Washington DC.

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