On Saturday Bush again started with making his tax cuts permanent. He ignores the fact that we are running an annual deficit of $600 Billion. What rational person that can not pay their bills takes a permanent cut in pay? We are borrowing money to cut taxes and than pay interest on that money we borrowed for the tax cuts. WHY? The Brookings Institute completed a study that showed, making the Bush Tax cuts permanent would add another $2.4 Trillion to the National Debt by 2014. Why would any president do something so devastating to this country? This is an issue the Democrats need to Filibuster about and STOP Bush and the GOP from bankrupting America!
http://enews.earthlink.net/article/pol?guid=20060401/442e08d0_3ca6_1552620060401-1782305586
Bush Pushes Case for Permanent Tax Cuts
By NEDRA PICKLER (Associated Press Writer)
From Associated Press
April 01, 2006 9:18 PM EST
WACO, Texas - President Bush used the upcoming income tax-filing deadline and his weekly radio address to promote tax-cut proposals and set up an election-year debate with Democrats over the issue.
In the broadcast Saturday, Bush urged Congress to permanently extend tax cuts that he pushed into law during his first term, which are set to expire in coming years.
"Some Democrats in Washington are insisting that we let that happen, or even repeal the tax cuts now," Bush said as he spent the weekend at his Texas ranch. "In either case, that would weaken our economy and would leave American families with a big tax hike that they do not expect and will not welcome."
Democrats argue Bush's emphasis on sweeping tax cuts is driving up the deficit. They say his tax relief primarily benefits the wealthy.
The president argued that he can meet his goal of cutting the deficit in half by the end of his time in office through pro-growth economic policies and spending restraint.
"The evidence is overwhelming: The opponents of tax cuts were wrong," he said. "Tax relief has helped to create jobs and opportunities for American families, and it's helped our economy grow."
Bush is down in the polls, which find most Americans objecting to the war in Iraq, and has said he recognizes that midterm election politics is making Republicans in Congress nervous. He used the popular GOP call for tax relief to appeal to Americans' pocketbooks with the April 15 filing deadline approaching.
"As tax day approaches later this month, many American families are now finishing their tax returns," Bush said. "And as you do, an important debate is taking place in Washington that will affect the amount you will pay in the years ahead."
http://www.brookings.edu/views/op-ed/gale/20040121taxcuts.htm
Key Points on Making the Bush Tax Cuts Permanent
The Brookings Institution, January 21, 2004
William G. Gale, Deputy Director and Senior Fellow, Economic Studies
Matthew Hall, Senior Research Assistant, Economic Studies
Peter R. Orszag, Senior Fellow, Economic Studies
Background
• Expiring tax provisions (or "sunsets") have long been a feature of the tax code, but they have traditionally involved minor provisions. The 2001 tax cut departed dramatically from this pattern: All of its provisions sunset by the end of 2010 and many expire sooner. The 2002 and 2003 tax cuts continued the aggressive use of sunsets to hold down official budget costs. Last night, in his State of the Union address, President Bush once more called for making the tax cuts permanent. This note provides information on the effects of doing so.
• For details, see "Sunsets in the Tax Code," Tax Notes, June 9, 2003 and "The Budget Outlook: Analysis and Implications," Tax Notes, October 6, 2003.
Revenue Estimates
A. Making the tax cuts permanent, assuming that the AMT follows current law
• Making the 2001, 2002, and 2003 tax cuts permanent would reduce revenues by $1.7 trillion through 2014. Including the added interest payments on the debt, the total increase in budget deficits would be $2.0 trillion.
• The 10-year estimate implicitly understates the long-term cost, since repealing the sunsets is a back-loaded tax cut. For example, in 2014 alone, the revenue loss from repealing the expirations would be $330 billion, or about 1.8 percent of GDP.
• Under these estimates, 44 million people would face the alternative minimum tax in 2014.
B. Making the tax cuts permanent, with AMT reform
• To avoid having the AMT take over the tax system, legislators will need to fix the AMT in one way or another. The President did not address AMT reform in his State of the Union, even though failing to reform the AMT would over time "take back" the tax cuts he is proposing to make permanent. Not fixing the AMT also reduces the apparent cost (in the budget) of making the tax cuts permanent.
• A natural AMT reform to consider is to extend expiring AMT provisions, index the AMT for inflation, and allow dependent exemptions to be counted against the AMT, moving all but 5 million households off the AMT by 2014 (compared to 3 million AMT payers today). This policy alone would reduce revenues by $452 billion over the next decade, and raise the deficit (including interest payments) by $572 billion. In 2014, it would reduce revenues by $52 billion, assuming the Bush tax cuts were not extended.
• If this AMT policy were followed, making the 2001, 2002, and 2003 tax cuts permanent would reduce revenues by $2.0 trillion through 2014. That is, cutting the AMT raises the costs of making the Bush tax cuts permanent. Including the added interest payments on the debt, the total increase in budget deficits would be $2.4 trillion. In 2014 alone, the revenue loss from repealing the expirations would be $435 billion, or about 2.3 percent of GDP.
• Including both the cost of the AMT reform and the extension of all of the expiring Bush tax cut provisions, the revenue loss would be $2.5 trillion over the next decade and the total increase in the deficit (counting interest payments) would be $3.0 trillion. In 2014 alone, the revenue loss would be $487 billion, or 2.6 percent of GDP.