Less income, higher taxes doesn't equate
Income Malaise of Middle Class Complicates Democrats’ Stance in Talks
By ANNIE LOWREY, NYT
WASHINGTON — The income stagnation that has hit the middle class in the last decade is complicating the Democrats’ position in the fiscal talks, making it more difficult for them to advocate across-the-board tax increases if a deal falls through.
Many Democrats have derided the expiring tax cuts as irresponsible since President George W. Bush signed them a decade ago. Yet the party is united in pushing to make the vast majority of them permanent, even though President Obama could ensure their expiration at year’s end with a simple veto.
That decision reflects concern over the wage and income trends of the last decade, when pay stagnated for middle-class families, net worth declined and economic mobility eroded. Democrats who generally would prefer more tax revenue to help pay the growing cost of Medicare and other programs are instead negotiating with Republicans to find a combination of spending cuts and targeted tax increases for higher incomes.
If the two parties fail to come to a deal by Jan. 1, taxes on the average middle-income family would rise about $2,000 over the next year. That would follow a 12-year period in which median inflation-adjusted income dropped 8.9 percent, from $54,932 in 1999 to $50,054 in 2011.
(More here.)
WASHINGTON — The income stagnation that has hit the middle class in the last decade is complicating the Democrats’ position in the fiscal talks, making it more difficult for them to advocate across-the-board tax increases if a deal falls through.
Many Democrats have derided the expiring tax cuts as irresponsible since President George W. Bush signed them a decade ago. Yet the party is united in pushing to make the vast majority of them permanent, even though President Obama could ensure their expiration at year’s end with a simple veto.
That decision reflects concern over the wage and income trends of the last decade, when pay stagnated for middle-class families, net worth declined and economic mobility eroded. Democrats who generally would prefer more tax revenue to help pay the growing cost of Medicare and other programs are instead negotiating with Republicans to find a combination of spending cuts and targeted tax increases for higher incomes.
If the two parties fail to come to a deal by Jan. 1, taxes on the average middle-income family would rise about $2,000 over the next year. That would follow a 12-year period in which median inflation-adjusted income dropped 8.9 percent, from $54,932 in 1999 to $50,054 in 2011.
(More here.)
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