July 14, 2010 Statement of Leonard E. Burman
Daniel Patrick Moynihan Professor of Public Affairs
Maxwell School, Syracuse University
Before the Senate Committee on Finance

THE FUTURE OF INDIVIDUAL TAX RATES: EFFECTS ON ECONOMIC GROWTH AND DISTRIBUTION

http://www.finance.senate.gov/imo/media/doc/071410Lbtest.pdf

Although this prophetic presentation was made 30 months ago, we are rapidly approaching the point of no return revealed by the report: - namely, the enormous risk that fiscally irresponsible and unpatriotic Congressional Republicans are willing to impose on our country and the rest of the world. Some selected excerpts follow with added emphasis in bold type:

As the CBO noted in a recent report on stimulus options, the “consumption [of higher-income households] is unlikely to be constrained by their income in a given year.”  Some have argued that lower income tax rates are necessary to encourage “pass through entities” whose owners pay individual income taxes to hire, but the CBO also was skeptical of that claim: “increasing the after-tax income of businesses typically does not create much incentive for them to hire more workers in order to produce more, because production depends principally on their ability to sell their products.”

Allowing the high-income tax cuts to expire will save $125 billion through FY 2013 compared with a full extension. Those savings could make a small dent in our ballooning debt, or they could fund more effective fiscal stimulus measures such as extending unemployment benefits or aiding the states.

If the Bush tax cuts had never been enacted, debt held by the public at the end of 2009 would have been reduced by 30 percent, to about $5.2 trillion or 37 percent of GDP. This was less than the level of the debt at the end of 1999. With the tax cuts, however, the debt ballooned to $7.5 trillion (53 percent of GDP) and is now over 60 percent of GDP. While the cost of two wars, enhanced homeland security, the TARP, several rounds of economic stimulus and an expensive new prescription drug benefit under Medicare have clearly also contributed to the run-up in debt, the fact remains that the debt would likely be at relatively manageable levels had it not been for the tax cuts.

As my Tax Policy  Center colleagues and I have explained, the debt explosion could have far worse consequences than a gradual erosion of the economy. It is possible that interest rates will remain low for years, creating a kind of debt bubble: our ballooning debt appears affordable to us and our lenders as long as interest rates stay low. At some point, investors perceive a risk of default on the debt (or inflation, which would devalue it). This pushes up interest rates, which in turn raises the risk of default, creating a vicious cycle. When the bubble bursts, the United States is an insolvent, heavily indebted superpower, with disastrous consequences for ourselves and the rest of the world. The possibility of such a “catastrophic budget failure” should be avoided at all costs.

End of excerpts.

The vast majority of Americans believe that our Congress is totally dysfunctional:

http://www.gallup.com/poll/156662/congress-approval-ties-time-low.aspx

http://www.huffingtonpost.com/2012/12/28/congress-unproductive_n_2371387.html

Most Americans also believe that way too many Congressmen are influenced way too much by way too many wackos:

BIRTHERS SUGGEST IMPEACHING CHIEF JUSTICE JOHN ROBERTS IF HE SWEARS IN PRESIDENT BARACK OBAMA FOR A SECOND TERM LATER THIS MONTH.

http://www.huffingtonpost.com/2013/01/08/john-roberts-birthers_n_2432334.html?ref=topbar

REP. TODD AKIN: “LEGITIMATE RAPE” RARELY CAUSES PREGNANCY.

http://www.globalpost.com/dispatch/news/politics/120819/rep-todd-aiken-legitimate-rape-rarely-causes-pregnancy

RICHARD MOURDOCK ON ABORTION: PREGNANCY FROM RAPE IS “SOMETHING GOD INTENDED”.

http://www.huffingtonpost.com/2012/10/23/richard-mourdock-abortion_n_2007482.html

PIERS MORGAN'S CAR CRASH INTERVIEW WITH US GUN NUT.

http://themediablog.typepad.com/the-media-blog/2013/01/piers-morgans-car-crash-interview-with-us-gun-nut.html

A partial list that people like more than John Boehner and the United States Congress:

1.                Root canals

2.                Head lice

3.                Colonoscopies

4.                Traffic Jams

5.                Cockroaches

6.                Donald Trump

7.                Used-car salesmen

But it’s not all bad news for Congress. Here are a few things Congress is more popular than:

§                  Telemarketers

§                  The Kardashians

§                  Lobbyists

§                  North Korea

§                  The Ebola Virus

§                  Lindsay Lohan

§                  Fidel Castro

§                  Playground Bullies

§                  Meth Labs

§                  Communism

§                  And, of course, Gonorrhea

http://www.govexec.com/excellence/promising-practices/2013/01/14-terrible-things-people-more-congress/60539/

Should the wealthiest Americans pay more in taxes before middle and lower class entitlement program benefits are reduced or individual co-pays are increased?

Married Filing Jointly

[2012 Tax Rate Schedule Y-1, Internal Revenue Code section 1(a)]

·          10% on taxable income from $0 to $17,400, plus

·          15% on taxable income over $17,400 to $70,700, plus

·          25% on taxable income over $70,700 to $142,700, plus

·          28% on taxable income over $142,700 to $217,450, plus

·          33% on taxable income over $217,450 to $388,350, plus

·          35% on taxable income over $388,350.

2013 Official Tax Brackets

Are you in favor of:

• Banning      assault weapons
• Restricting      magazine size
• Criminalizing      straw gun purchases
• Criminal      background checks on all gun purchases
• Greatly      reducing the maximum number of gun purchases per month
• Greatly      reducing the number of guns per household
• Barring      all gun show sales that do not conform to yet to be implemented stricter      regulations
• Barring      sales to mentally disturbed people
• Imposing      strict penalties to those who illegally provide weapons to others
• Creating      a national gun owner data base

Are you against the Republican hypocrites who voted against the Sandy relief bill?

http://www.dailykos.com/story/2013/01/04/1176318/-The-Republican-hypocrites-who-voted-against-Sandy-relief-bill

If any of these (or other) matters concern you, please contact all of your appropriate elected Government and/or State officials easily and quickly by clicking HERE and express your opinion regarding your issues of concern. Please forward this to your like-minded friends and relatives.

Perhaps if enough of us let them know our preferences, the do-nothing Congress may get the message that Republican, Democrat and Independents prefer reasonable negotiations that result in a better country and world rather than attempting to appease Grover Norquist and his dwindling Tea Party followers.