Senate Republicans Thursday night defeated the payroll tax break for working Americans. President Obama’s statement:
Tonight, Senate Republicans chose to raise taxes on nearly 160 million hardworking Americans because they refused to ask a few hundred thousand millionaires and billionaires to pay their fair share. They voted against a bill that would have not only extended the $1,000 tax cut for a typical family, but expanded that tax cut to put an extra $1,500 in their pockets next year, and given nearly six million small business owners new incentives to expand and hire. That is unacceptable.
It makes absolutely no sense to raise taxes on the middle class at a time when so many are still trying to get back on their feet. Now is not the time to put the economy and the security of the middle class at risk. Now is the time to rebuild an economy where hard work and responsibility pay off, and everybody has a chance to succeed. Now is the time to put country before party and work together on behalf of the American people. And I will continue to urge Congress to stop playing politics with the security of millions of American families and small business owners and get this done.
Next the Republicans offered their plan to give a small;er cut by screwing working people — cutting federal jobs, freezing federal pay, means-testing Medicare and other benefit programs. In the Republican world, millionaires don’t share the burden. They’re the 1 percent. They rule. The 99 percent pay.
UPDATE: The Republican plan was defeated, too. U.S. Sen. Mark Pryor voted with most Democrats on both measures. Sen. John “Dr. No” Boozman went with the millionaires on the Democratic plan.
UPDATE II: Musing on income inequality, I came up with an illustration of one of the many things wrong with our tax system. Take the Walton family. They own 1.7 billion shares of Walmart. No, they didn’t buy their shares. No, they didn’t work in the company to earn them. Those shares pay about $2.5 billion a year in dividends. Because they are dividends, not earned income, the tax rate on such an unearned haul is 15 percent. By way of comparison, the federal income tax rate on income from labor (jobs, in other words) kicks in at 15 percent for a married person filing jointly at $17,201. The 25 percent rate starts at $69,801 taxable income. But that’s work, not wealth. Wealth deserves a lower tax rate than that charged middle class working people, right? If you’re a 1 percenter, you know the answer.
It’s stuff like this that gives traction to the inequality message being successfully advanced by Occupy Wall Street. It’s why GOP message maven Frank Luntz is so nervous about OWS.