Luckily for us, cats don't pay taxes. Strictly speaking this is probably because we don't have an income, but lets not get sidetracked. This post is about taxes for humans and we cats had to do some pretty hard core research to figure this one out. The sources for our data are linked in this article but be warned, they could lead to headaches!
Its hard to get to the bottom of the taxes issue and lots of words have been flying around. Luckily for us, the non-partisan Tax Policy Center has analyzed both Obama and McCain's tax proposals and figured out what they would mean to the American taxpayer.
BOTTOM LINE
In brief, Obama's plan addresses the growing inequality in America by giving middle and lower income families the most tax breaks and by increasing taxes on corporations. McCain's plan, in contrast, benefits the wealthy and corporations. McCain's plan is the most expensive and would decrease tax revenue by 4.2 Trillion over 10 years and add 5.1 Trillion to our national debt. Obama's plan would reduce tax revenue by 2.9 Trillion over 10 years and add 3.6 Trillion to our national debt.
If you click on this chart, taken right from the Tax Policy Center executive summary, it will open up a larger version and you can better see the data and my annotations.
THE CHART
The light gray bars are for Obama's plan and the dark gray are for McCain.
I've circled in green the bottom three income categories where Obama's plan clearly benefits taxpayers more. I've put a yellow highlight on the top income group where McCain's plan clearly benefits people the most.
OBAMA TAX BREAKS FOR LOW AND MIDDLE INCOME
Here's what the Tax Policy Center said about this:
The two candidates' tax plans would have sharply different distributional effects. Senator McCain's tax cuts would primarily benefit those with very high incomes, almost all of whom would receive large tax cuts that would, on average, raise their after-tax incomes by more than twice the average for all households. Many fewer households at the bottom of the income distribution would get tax cuts and those tax cuts would be small as a share of after-tax income. In marked contrast, Senator Obama offers much larger tax breaks to low- and middle-income taxpayers and would increase taxes on high-income taxpayers. The largest tax cuts, as a share of income, would go to those at the bottom of the income distribution, while taxpayers with the highest income would see their taxes rise significantly.
THE VERY WEALTHY
On the far right of this chart, you can see the impact of these two tax proposals on the very wealthy. The top 1.5% of Americans make $250,000 or more per year and the top 0.1% of Americans make $1,600,000 per year. Those income groups will see huge tax savings under the McCain plan while Obama will increase their taxes by a few percentage points. I got out the calculator (a pretty amazing feat considering I don't have opposable thumbs) to see what kind of money the McCain tax breaks for the wealthy represent. If you make $300,000 in 2012 and this tax reduction is 9% then that's $27,000 more for you to keep. If you make $1,600,000 in 2012 and this tax savings is 11%, you get to keep $176,000 more. The McCain tax cut proposal for the top .1% in income means that they get a tax break that is three times higher than the average Colorado human's yearly income!
CORPORATIONS
Another important part of these tax plans is about the taxes that corporations pay. Obama would raise corporate taxes while McCain would reduce corporate taxes. Small businesses that make more than $250,000 a year would see taxes rise under Obama's plan.
WHAT DO WE THINK?
If people voted based purely on self-interest and tax savings, about 80% of households should vote for Obama and only 20% for McCain. This is based on 2006 Census information as reported in Wikipedia which says that 79.98% of households make less than 100k per year. Its also based on data which says that the "top quintile" in the table above starts at $111k per year. That's the only group which gets a personal tax advantage from the McCain plan.
Although we're just cats, we notice that our humans are interested in more than just money. For example, they are really crazy about cats and spoil us like crazy! They also believe in the value of a society without extreme inequality. They've heard that the middle class is disappearing, the wealthy are getting wealthier, and everyone else getting poorer. My people like the Obama plan because it means greater equality. Today inequality in America is INCREASED by our tax system - that means there is a greater difference between the rich and the poor after everyone pays taxes (see p.21 in link for reference). We like that the Obama plan works to reverse that effect.
- Starbuck & Midnight
www.Cats4Obama.com
Starbuck and Midnight - I completely agree with your analysis. Thanks for the chart - great illustration that I am planning to forward on to others that have not yet decided to support Obama.
Sincerely,
Sadie Dog (not normally a friend to cats, but any friend of Obama is a friend of mine)
Posted by: Keely B. | September 15, 2008 at 01:28 PM