Saturday, February 28, 2009

Pres. Obama's budget proposal is audacious

Two impeccable liberals, Robert Kuttner (the American Prospect co-editor) and NYT's oped economist, Paul Krugman, like the proposals.
President Obama's new budget is, well, audacious -- not just because it includes several big, audacious initiatives (universally affordable health care, and a cap-and-trade system for coping with global warming, for starters) but also because it represents the biggest redistribution of income from the wealthy to the middle class and poor this nation has seen in more than forty years. In order to see the whole, you need to look both at where revenues will come from and at where they’ll go:
Come from: By allowing the Bush tax cuts to expire, the marginal income tax on the highest earners goes back to 39.6 percent (from 35 percent, now), and capital gains rates to 20 percent (from 15, now). The budget also limits the amount highest earners can claim for mortgage-interest and charitable deductions (from 35 percent now down to 28 percent), raising an estimated $318 billion over ten years. Finally, wealthier Medicare beneficiaries will have to pay higher premiums for prescription drugs.
Krugman:Op-Ed ColumnistClimate of Change Published: February 27, 2009
Elections have consequences. President Obama’s new budget represents a huge break, not just with the policies of the past eight years, but with policy trends over the past 30 years. If he can get anything like the plan he announced on Thursday through Congress, he will set America on a fundamentally new course

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