| Two studies, one supported, in part, by the Social Security Administration and the other put out by The Institute on Taxation and Economic Policy show that after thirty one years, beginning with California's Proposition 13, that these cuts and caps have benefited the wealthy at the expense of middle and low income Americans.
Sam Pizzigati, in his piece, "Whatever Happened to the Good Times the Tax Cutters Promised?" analyzes the studies in the light of the claims made by proponents of caps and cuts. The upshot: these policies do not put money in most people's pockets, but take it away.
According to the ITEP study, the richest 1% of Americans pay 6.4% of their incomes in state and local taxes, while the middle class pays 9.4%. The poorest among us pay 10.9%.
Pizzigati points out the cappers and cutters never promised a rose garden to the poor and middle class. No, they claim, and still do, despite all evidence to the contrary, that the wealthy, by keeping more money, would extend that wealth to others by investing and creating jobs. The rub is, that hasn't happened.
The study supported by the SSA and carried out by Brookings Institute researchers Barry Bosworth and Rosanna Smart, found that since 2007, Americans have lost 26% of their total net worth.
Pizzigati
But low- and middle-income households under age 50 haven't just lost a big chunk of the wealth they held in 2007. These households have actually lost all the wealth they had gained since 1983, the first year with Federal Reserve family wealth data available.
For example, families in the bottom third of income had a net worth of $24,000 (adjusted to the worth of a dollar in the year 2000) in 1983. That has gone down to $17,000 of those same dollars today. The middle third saw their net worth decrease from $50,000 to $45,000.
These were the years of getting government "off our backs and out of our pockets". In New Hampshire, for example, Republicans had majorities in the State Legislature until 2007 and the governor's office for most of that time. The same at the federal level. The only Democrat in the White House during those years was Bill Clinton. And he had Newt Gingrich and his "Contract with America" to contend with from 1994 until the end of his administration.
Where is the wealth the average American was promised?
Pizzigati ends his post with this:
Back in the middle of the 20th century, governments in the United States routinely taxed the rich to pay for the programs that built a vibrant middle class. The Tax Revolt that began three decades ago, by demonizing taxes, gave the rich a free ride and gutted those programs.
That demonization today continues, with politicos beholden to that rich cynically fanning the Tea Party flames. They don't care who gets burned. The rest of us should.
Dean's post has charts from the ITEP study comparing New Hampshire and Vermont.
And a giant hat tip to Meteor Blades for his post on Pizzigati's article. |
