Most of the stories I have seen on the subject focus on the cost of extending the tax cuts for only the wealthiest Americans. I really cannot recall reading anywhere in the mainstream media or on a liberal blog what the cost would be for the Democrats’ proposal of extending the tax cuts only for individuals who earn less than $200,000 and married couples who earn less than $250,000.
So here (pdf):
From a budgetary perspective, the price of extending all of the cuts is steep; full extension would contribute $3.7 trillion to the deficit over the next ten years.
The administration’s proposal shaves off about $680 billion from the 10-year deficit…
Extending the tax cuts for the first 98% of the population will cost about $3 trillion over 10 years, while extending them for the last 2% will cost an extra $680 billion.
Krugman pointed out yesterday that $360 billion of that $680 billion will go to “the richest 120,000 people in the country.” That’s the richest 0.1% of Americans; “the poorest members of the group have annual incomes of more than $2 million, and the average member makes more than $7 million a year”.
So, to summarize:
• For the first 98% of Americans, extending the tax cuts for 10 years will cost $3 trillion. By a rough calculation, that’s $2,500 each year per taxpayer.
• For the next 1.9% of Americans, extending the tax cuts for 10 years will cost $320 billion. By a rough calculation, that’s $14,000 each year per taxpayer.
• For the last 0.1% of Americans, extending the tax cuts for 10 years will cost $360 billion. By a rough calculation, that’s $300,000 each year per taxpayer.
That first $3 trillion will unquestionably have a stimulative effect on the economy. That is to say, most of this money will be spent, and contribute to demand, growth and reduced unemployment.
The last $680 billion stimulates the economy only in the depraved wet dreams of the asshole contingent of the Republican Party.
(See also: Much Better Than 1,000 Words)