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My favorite conservative economist, Greg Mankiw, would like to dispel the “myth” “that President Obama just wants to return the tax code to where it was during the Clinton years.” This isn’t true, Mankiw says, and offers evidence:

This table from the Tax Policy Center is useful in dispelling the myth. Compare the far left column (Clinton-era tax policy) and the far right column (Obama’s proposed tax policy). It shows the following: Compared to President Clinton, President Obama would cut the effective tax rate by about 2 percentage points for the bottom 99 percent of the population and raise the effective tax rate by about 2 percentage points for the top 1 percent of the population.

You can agree or disagree with that policy choice. But the facts are clear. President Obama’s policy preferences are more focused on income redistribution (aka “class warfare”) than President Clinton’s tax policy ever was.

Obama has proposed returning the marginal tax rates for the wealthy back to what they were under Clinton. The effective tax rates under this proposal may be higher on the rich and lower on the poor because rich people earn more money and poor people earn less money than they did under Clinton. Also, cutting taxes on the rich so you can reduce entitlement programs for the poor is income redistribution (aka “class warfare”).
8 months ago - read more...

August 4, 2011