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The Amazing Disappearing Middle-Class Tax Cuts ...

Just for kicks and grins (and because you can't rule her out as the ultimate Democratic nominee), I've been doing the distasteful job of surfing the she-Clinton's website.

Here's my most interesting finding.

Under Strengthening the Middle Class there is a link that is supposed to lead to Lowering Taxes for Middle-Class Families.

When you get there you find an October 2007 article from Iowa entitled "Hillary Clinton’s Economic Blueprint for the 21st Century: Rebuilding the Road to the Middle Class."

There you find (only in the very fine print after you've covered all the new government giveaways she endorses):

Restore fairness to the tax system. Hillary will return to the income tax rates for upper-income Americans that we had in the 1990s – rates that were consistent with a balanced budget and economic growth. She will level the playing field when it comes to taxing the income earned in investment partnerships. Right now, some Wall Street investment managers making $50 million a year could pay just 15% on their earned income – while someone making $50,000 a year pays 25%. That is simply wrong, and Hillary will change it. In addition, Hillary will extend middle class tax relief, the child tax credit and marriage penalty relief, and reform the AMT to ensure people don’t face stealth tax increases.


So the primary focus is to repeal the Bush tax cuts, and "in addition" she's going to do something for the middle class.

But what, exactly?

Let's work on the sentence again: "In addition, Hillary will extend middle class tax relief, the child tax credit and marriage penalty relief, and reform the AMT to ensure people don’t face stealth tax increases."

It doesn't so much depend on what the meaning of "is" is, but what the comma between the words "relief" and "the" is intended to do. It looks suspiciously like everything after the comma is the list of what she intends as middle class tax relief. So we're left with unspecified, almost footnote-afterthought commitments to doing something or other with the child tax credit (probably leaving it where Bush put it), the marriage penalty (ironically, a standard Republican tax promise), and another unspecified reform of the Alternative Minimum Tax. The only way you can reform the AMT (aside from just junking it) is to index it for inflation (again, another Republican standard talking point).

So Hillary's vaunted Tax Relief for the Middle Class is three Republican main-stay ideas?

Which left me wondering what Barack Obama was promising the Middle Class:

Provide Middle Class Americans Tax Relief

Obama will cut income taxes by $1,000 for working families to offset the payroll tax they pay.

Provide a Tax Cut for Working Families: Obama will restore fairness to the tax code and provide 150 million workers the tax relief they need. Obama will create a new "Making Work Pay" tax credit of up to $500 per person, or $1,000 per working family. The "Making Work Pay" tax credit will completely eliminate income taxes for 10 million Americans.

Simplify Tax Filings for Middle Class Americans: Obama will dramatically simplify tax filings so that millions of Americans will be able to do their taxes in less than five minutes. Obama will ensure that the IRS uses the information it already gets from banks and employers to give taxpayers the option of pre-filled tax forms to verify, sign and return. Experts estimate that the Obama proposal will save Americans up to 200 million total hours of work and aggravation and up to $2 billion in tax preparer fees.


OK, there is at least an actual promise with some figures attached here: about $1,500 for working families, although you have to wonder at exactly what income level these benefits will be phased out.

What's really scary is the idea that the IRS would now send me pre-filled tax forms. No need to think any more, the government will just tell you what you owe, and you can send the check tomorrow. There are few things worse than the current Byzantine tax system, but this is certainly one of them.

All of which distracts us from the fact that Obama has no intention at all of modifying or ditching the AMT.

While I was at it, I trucked over the the Straight-Talk Express to see what John McCain had in store for middle-class taxes:

Cut Taxes For Middle Class Families: Hard-working American families need lower taxes. John McCain will permanently repeal the Alternative Minimum Tax (AMT) -- a tax that will be paid nearly exclusively by 25 million middle class families. John McCain will repeal this onerous tax, saving middle class families nearly $60 billion in a single year. Under McCain's plan, a middle class family with children set to pay the AMT will save an average of over $2,700 -- a real tax cut for working families.


McCain critics will be quick to point out that the majority of families struck by AMT will be in the $150,000+ range, this creating a sort of "Republican middle class" that's way above anything the Democrats would consider middle class. On the other hand, 15% of families paying AMT actually fall in the $75,000-100,000 range. Even so, this isn't going to play well with the people who think middle class tops out somewhere under $75,000.

What's really interesting is that nowhere on his campaign website does McCain promise to make the Bush tax cuts permanent, even though he's said it in numerous speeches. Wonder what's up with that?

So where has this meander through middle-class tax cut promises gotten us?

For one thing, it has highlighted the fact that none of the three presidential wannabes has any serious intention of reforming the tax code, significantly reducing the tax burden on middle-class families, or controlling spending.

The government under President Clinton, President Obama, or President McCain will continue to grasp your wallet as firmly as ever to pay for social programs and wealth transfers that pass debt down to our children.

Irony: if we could simply scale back Federal expenditures to 1996 levels, we could eliminate the Personal Income Tax completely; but you won't hear any of our candidates talk about that, either.

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