If Senate Passes Bush Tax Extension, Philadelphia Will Pay the Price
A Contributor Perspective: Proposed Obama Partial Tax Plan & Philadelphia
The City of Philadelphia is unique; we live in the city in which the US was born and, much like the capitol of the nation now, we are significantly sub-par when it comes to income averages. The other similarity is that we are in the middle of a sea of very high income brackets. The Bush Tax cuts helped very few people in Philadelphia.
Consider This...
The national median income is $52,000± whereas the median income in the Philadelphia area is $36,000±, which is over 28 percent less than the national average. Nationally, only four percent of people earn over $200,000 and I can assure you that the ratio is far less in Philadelphia. Those tax cuts are not doing anyone any good here, but the proposed changes will, especially for those who make what I do-about $20,000 a year.
Obama's Version
The Tax Bill under consideration starts with the expiration of the Bush Tax Cuts, but there is more to it than that. It will not only continue the tax cuts for the lower and middle class, but it will also contain significant small business tax cuts that would have a proportionally greater impact in Philadelphia. Most of Philadelphia's businesses are small, which also means that most available employment is with those small businesses and the boost to the local economy will be significant.
Unemployment is right up there with the national average, but housing starts have fallen by well over 50 percent since 2008 in Philadelphia. Housing, home improvement, and contracting hold the majority industry sectors in Philadelphia and the small business equipment purchasing tax break alone will boost the local economy significantly.
With so much attention focused on the upcoming elections and the bitter bipartisan rivalry, these issues weigh heavily on us all. The middle class tax cuts must remain, as a tax hike would be a serious blow to the economy. If the tax cuts for those earning over $200,000 do not expire, the federal government will have a much harder time bringing the budget back under control because it would lose trillions of dollars. Of course, in the local area it might be a different story if many people benefitted from the Bush tax breaks, but there is not. Around here, Joe the plumber makes much less-so do I as do most of the families in my neighborhood.
Upcoming Fights
With Joe Sestak fighting to keep Pat Toomey out of the senate seat and the business stimulus bill on its way to the Presidents desk, this is a crucial time for Philadelphia and for me personally. With a Democratic win across the board, the Philadelphia economy will begin to heal as direct benefits and stimulus feed into the system and 98 percent of the local earners see no tax hikes. More importantly, we might just start to feel that the government is aware and doing something for the "little guy" (or gal as in my case).
Not that I am complaining, but writing on the Internet (as many of you know) does not fall into the category of $200 thousand income-producing activities. At least not for most of those in my position. While a continuing of the huge Bush tax breaks will not benefit me as I am not "wealthy," I will be impacted nonetheless as budgets will be tight and any recovery will be much slower. Maybe that is what the Republicans want-continue the Bush tax cuts to keep America down. $4 trillion over ten years is what the middle class would miss if the Bush Tax Cuts continue. Middle Class is again paying the rich to prosper until we give the country back to them and I will not-cannot-do it.
References:
"Comparing Democratic and Republican Tax Cuts," Washington Post
Chris Arnold, "Whither Small Businesses? The Debate Over Tax Cuts," NPR
"This is what the Republican Tax Cuts Look Like," The Atlantic
Income statistics: US Census Bureau
Housing Data: PhiladelphiaFed
Housing Data Trend Chart: PhiladelphiaFed
Published by JC Torpey - Featured Contributor in Technology
JC Torpey started writing at a young age and is affiliated with many online publishing websites. JC's expertise includes network security, PC health and the Internet. Her specialized writing areas include we... View profile
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- The Bush plan, if extended, will continue tax cuts for the wealthiest two percent of families.
- Philadelphians will suffer if the tax cuts continue unchanged.
- Most of Philadelphia makes less than $200,000.
4 Comments
Post a CommentI totally agree with you, and if Obama bails on this issue, I will be totally bummed. He needs to say: "Whatever became of the notion of shared sacrifice? We have our volunteer soldiers, basically from low- and middle-income families, in the Middle East making ultimate sacrifices. In this perspective, how can the wealthy look themselves in the face and argue for tax cuts?" Although it seems that stupid, ignorant low- and middle-income people argue the strongest on behalf of rich people in this case. Obama needs to hold the course; he has been disserved by some of his stupid advisors, such as Axelrod and Gibbs.
I disagree- You cannot raise taxes during bad economic times. If you do, things will only get worse. If you over tax the rich, there will be less jobs for everybody and many jobs will go to other countries.
Respectfully, I must disagree. Now, in the middle of a recession (despite what the government now says about the recession being over) is not the time to give anyone what amounts to a major tax hike on January 1, 2011. Even if you eliminate tax cuts only for those making over $250,000 a year, that means those people - most of them small business owners - will have to reallocate a significant portion of their income to the IRS, and won't be able to reinvest in their business, buy more inventory, and ultimately hire more workers. The bottom line would be more hardship, not less, for the working class. Excellent editorial, though!
Respectfully disagree completely. The reality is we need those with larger incomes being willing to spend their money rather than have more of it taken by the government. Most small businesses fall into the category of 200,000+ dollars a year meaning their taxes are about to go up. This means they fire someone or raise their prices to cover this new tax burden. As a writer, you are typically paid by people making much more than you do and if they have to give an extra 15% of their income to the government, that is likely going to come out of the budget that is currently helping you make your 20,000 a year.