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Opinion

Tax cuts: All for one and one for all

Tax cuts: All for one and one for all
BY MICHAEL BUSLER
COMMENTARY

Congress has begun to debate extending the tax cuts that were enacted by President Bush in 2001. These tax cuts were supposed to last only ten years so they are set to expire at the end of this year. By not extending them we will, in effect, be raising taxes for every taxpayer, no matter what their level of income may be. In most cases, the increase will result in income earners paying 10% more tax dollars. Virtually everyone supports the extension. But do we support the extension for every income earner?

Raising taxes during a fragile recovery would have disastrous effects on consumer spending. Here's why: People do three things with their income. First they pay personal taxes. What's left over they are free to dispose as they please. (Economists call this disposable income.) Then they take, on average, more than 95% of this disposable income and spend it. The remaining less than 5% they save and invest. So if the tax cuts expire, taxes paid will go up, disposable income falls and consumer spending falls dramatically.

Since most of us (maybe as high as 98%) fit this pattern, President Obama says this is where the tax cut extensions would do the most good. This should increase demand and get the economy moving. And, he says, these are the people who need the tax relief. He further argues that the other 2% should not get the extension. They don't need it and, since the deficit is so large, we can't afford it. The reality, however, is that we can't afford not to extend it to the top 2%, since that tax cut benefits all of us. How?

 

Spin is alive and well in New Jersey and America

Spin is alive and well in New Jersey and America
BY RICHARD A. LEE
COMMENTARY

In today's media environment, most major news stories are accompanied by healthy doses of spin.

Last week, BP issued a 193-page report that attempts to shift much of the blam...

Now, more than ever, America must speak with one, strong, commanding voice

Now, more than ever, America must speak with one, strong, commanding voice
BY PAUL S. ARONSOHN
COMMENTARY

Sadly, our world is in great disrepair.

So much violence. So much disaster. So much poverty. So much disease. From the estimated 80 terrorist attacks that have already ...

Dragging the legislature to reform

Dragging the legislature to reform
EDITORIAL CARTOON BY MIKE SCOTT
NEWJERSEYNEWSROOM.COM

Gov. Chris Christie announced his plans to reform how government runs in Trenton: Limiting public officials to one salary, banning dual officeholdin...

Obama could use a lesson in economics 101

Obama could use a lesson in economics 101
BY MURRAY SABRIN
COMMENTARY

Last week, President Obama made a speech in Ohio about the economy. Below are excerpts from the speech and reveals what we know about seasoned politicians — they want everyo...

Return education policy back to local communities

Return education policy back to local communities
BY SCOTT GARRETT
COMMENTARY

Recently, the U.S. Department of Education announced the 10 finalists for the "Race to the Top" initiative. Enacted shortly after President Obama took office, this program al...

New Jersey may give up its leadership on sex ed

New Jersey may give up its leadership on sex ed
BY SUSIE WILSON
NEWJERSEYNEWSROOM.COM
SEX MATTERS

Sometimes you have to go out of state to make a point. So, as the school year opens, I'm taking you to Minnesota to discuss a sex education controversy t...

Lack of leadership by N.J. Democrats is one of many things to dislike lately

Lack of leadership by N.J. Democrats is one of many things to dislike lately
BY IRWIN STOOLMACHER
NEWJERSEYNEWSROOM.COM
COMMENTARY

A day does not go by lately without me getting ticked off about something. Here are four items in the news that have really gotten my dander up:

On ...

September 11 controversies give chance to re-examine freedoms

September 11 controversies give chance to re-examine freedoms
BY MIKE VORKUNOV
NEWJERSEYNEWSROOM.COM
COMMENTARY

Yesterday was a special day for my family and me. It marked the 17-year anniversary of our immigration to the United States. As for all émigrés that day ...

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