If those tax cuts are only for the wealthy, why are my taxes going to go up when they expire?

The media keeps calling the Bush tax rates “tax cuts for the rich”. This may reflect just how close to bankruptcy the media’s bias has brought them, or it might just be simple deception.

Even if I pulled out my old paystubs, it’d be hard to figure out what was lower taxes and what was higher pay, because back then my employer was able to give me a raise every year (unlike last year). But here’s a page that helps. According to it, the Bush tax cuts reduce my taxes by $125 a month. Which means that the Democratic tax increase will raise my taxes by $125 a month. That’s a lot of money, and it matches well with the about 50-75 dollars a month I think I was able to keep ten years ago. I wasn’t rich then, and I’m not rich now. I know I’ve said this before, so this time I thought I’d give you a tour of the palatial Mimsy estate.

I live in a two-and-a-half room apartment. One bedroom, one living room, and a tiny kitchen separated from the living room by way of a bar. Our neighbor is a parking structure. We’ve got a nice canyon outside our apartment. On the other side is a hospital—which attracts helicopters that set off car alarms in the parking structure.

Nice parking structure. They don’t let us park in it. Too bad, the Porsche could stand some shade.

I like this place. It’s “cozy”. But when apartment ads say “cozy” they don’t mean “center of wealth and power”.

It’s true that the showerhead in the shower photo is very new. I installed it myself. It’s a low-flow showerhead. When I use the showerhead that came with the apartment, water comes out at a low pressure but a very fast rate—faster than the bad plumbing in the apartment can drain. I end up taking a shower and a bath at the same time.

Up until a few weeks ago, the Mustang you see on this page was the Mimsy-mobile: a 1984 vehicle that I bought for $2,100 in January of 1996 after five years of not owning any car at all. By driving that car for fifteen years I was able to save up enough to buy a newer car a few weeks ago.¹ It cost $17,500² and it’s five years old.³

No, that’s not compression artifacts; that wonderful grouting job comes with being wealthy. All the best people, etc.

I’m far from the days when I lived in a van down by the river.⁴ But wealthy? I don’t think so. Yet, this luxurious estate is all the “opulence” required to be affected by the Bush tax cuts. It’s a real Bizzaro world in which renting a two-room apartment and driving a used car makes you “wealthy”.

Taxes cost jobs. They cost little jobs and big jobs. For years, I’ve wanted to pay people to write for an amateur gaming magazine. I don’t, because the paperwork and risk of running afoul of the IRS isn’t worth it. The same can and does apply to small business owners. The more complex and costly we make it to spend money on building a business, the fewer people will do it—and the fewer jobs they’ll create.

Here’s a perverse incentive for you: over the last ten years I’ve accumulated a lot of stock. I’m expecting to use it for retirement. If I cash in today, I will pay $20,000 less in taxes than if I cash in next year after the Bush tax cuts expire. Look at those apartment photos again. That’s an extra year’s worth of income⁵. Even under Obama’s or the Democrat’s tax “cuts” I’d still be out another $10,000.

La cuisine isn’t a separate room.

It seems like it should go without saying, but given the trillion dollar spending bills passed in the last two years, it probably doesn’t: that’s a lot of money.

And it’s yet another Bizarro-world construction that paying more in taxes is a tax cut plan. It’s not a tax-cut plan, it’s a tax increase plan with a different level of taxes. And while the estimate page I’m using gives an “Obama” plan for comparison purposes, there is no current Obama plan; my understanding is that the “Obama plan” is just the Bush plan with some tax cuts removed—a “Bush lite” plan and that it hasn’t even been written up yet.

Since starting to write this, the web site has also put up a “Congressional Dems Plan”. I don’t know if it’s sarcasm or what, but the only mention I can find of a Congressional Democrats plan is from House Ways and Means Chairman Sander Levin. Levin also says that the Senate needs to go first. The Senate hasn’t gone first; there is no plan. The only plan with any specifics is the Republican one: extend all of the tax cuts.

Up until a few weeks ago, this was the Mimsy-mobile. That’s not rust, it’s rouille.

I think the Democrats in congress have already realized that their position is untenable, even if the bloggers and journalists on the left haven’t. Democratic House Majority Leader Steny Hoyer is calling it a Republican tax increase—because when the Republicans passed the tax cut, they tried to work with Democrats, and Democrats required it to sunset. So that makes it the Republicans’ fault. Somehow I don’t think that argument is going to go over well with voters.

Another dark laugh is hearing that keeping these tax cuts will create debt. That’s backwards. Tax cuts don’t create debt. Spending creates debts. We can choose to cover those debts with tax increases, and often we’ll want to. But it’s important to remember that only spending creates debt. This is along the same line that not increasing taxes is like the government giving away free money to people who don’t deserve it.

Letting us keep more of our money is not giving us money; it’s not taking more of our money.