When he points out that tax breaks for the rich are not “unfair,” Jeb Bush Is right.
I suppose this Politico headline will enrage many voters: “Jeb Bush defends tax breaks for wealthy.”
The wealthiest Americans would receive sharply higher tax breaks under Jeb Bush’s tax proposal, the former Florida governor says, because they pay a disproportionate share of taxes in the first place.
“The simple fact is 1 percent of people pay 40 percent of all the taxes,” Bush said on “Fox News Sunday.” “Of course, tax cuts for everybody is going to generate more for people that are paying a lot more. I mean that’s just the way it is.”
Fox Host Chris Wallace noted in the interview aired Sunday that economists assessing Bush’s proposal have found that while middle-class Americans would get a 2.9 percent boost in income, the top 1 percent would get an 11.6 percent boost – and Bush himself would save $3 million. “Does Jeb Bush need a $3 million tax cut?” Wallace asked.
“Look, the benefit of this goes disproportionately to the middle-class,” Bush responded, adding, “Because higher income people pay more taxes right now and proportionally, everybody will get a benefit. But proportionally, they’ll pay more in with my plan than what they pay today.”
Under Bush’s plan, tax deductions would be capped at 2 percent of gross income, with an exception for charitable donations. He’d also couple that with a sharply lower corporate tax rate. And he’d simplify the tax code by enacting three tax brackets – 10, 25 and 28 percent. And Wallace pointed to analysis that Bush’s plan would raise the deficit between $1 trillion and $3 trillion.
The increasing of the deficit worries me, but let’s first deal with the basic claim that the wealthy pay a disproportionate amount of taxes. Jeb Bush is right. That’s why Mark Horne wrote awhile back, “Rich Don’t Pay Their Fair Share; They Pay Everyone’s Share.”
Horne also pointed out that there are other ways that the rich (or some of them) benefit from government policy at the expense of others, but taxes are not the offender.
That being said, I have my doubts about the wisdom of lowering taxes and increasing spending (which happens automatically; usually when we hear of “spending cuts” they are really cuts in expected spending increases, not actual reductions in spending). Bush is hoping that the tax reductions will cause economic growth which will produce more tax revenue. But that won’t keep the national debt from growing. Reagan got away with this when the national debt was relatively low. After the insane spending of Barack Obama (on top of the insane though tamer spending of George W. Bush) I doubt we can afford to avoid massive reductions in spending.
But no one wants to propose real cuts in government spending. They would rather pretend there will never be a judgment day.