Tax the Poor?
"Tax the poor" isn't good politics. No politician runs on that platform plank. Tax the rich maybe.
This administration - and others - have come to office with some form of "Tax the rich" scheme. And some have pursued this scheme. That's why a recent CBO report really caught my attention.
The Congressional Budget Office (CBO) recently analyzed the proposed "cap and trade" program that is part of the administration's proposed tax increases. "Cap and trade" is the proposed tax on utility companies who produce carbon dioxide emissions. They will have to cut down on emissions or pay up. Practically speaking, most of them will simply pay up, given the cost of cutting down on emissions anytime soon.
Of course, that means they'll pass those additional costs on to their consumers - people who drive cars, take public transportation or use electricity - which means us. And here's where "Tax the poor" comes in - where the poor get to suffer even more than the rich.
In their analysis, the CBO includes a table that shows how the poor spend over 20% of income on energy - the biggest chunk being utility bills and gas for their cars - while the rich spend only around 4%. So logically if the cost of electricity goes up (and it will if the tax increases are passed by Congress), the poor will feel the impact of the utility rate increases more than the rich. If you do the math, it will impact the poor about five times more than the rich.
In other words, the poor will suffer disproportionately as a result of this one part of the new tax increases.
We've all seen a lot of complaining about the impact of the proposed tax increases on the rich. On one side, the claim is that it's unfair to target wealthier Americans; on the other side, the claim is that wealthier Americans shouldn't complain about shouldering a heavier tax burden.
Frankly, this debate is nothing new. And we suspect it will go on as long as government taxes some people more than others.
But it would be a real shame if the burden placed on poorer Americans as a result of "Cap and Trade" isn't addressed - if this just slips through the cracks. Doesn't this strike you as simply unfair?
I've read that "Cap and Trade" legislation may not pass. But who knows? First Health Care reform was a slam dunk, then it seemed to fade away, now it's back. Cap and trade kind of got lost in the mix. It may come back too. If it does, I just hope whatever form the bill takes considers this CBO report so the poor don't suffer as a result.
Government sure has a way of screwing up at times, doesn't it? "Tax the poor" is about as screwed up as it gets.
This administration - and others - have come to office with some form of "Tax the rich" scheme. And some have pursued this scheme. That's why a recent CBO report really caught my attention.
The Congressional Budget Office (CBO) recently analyzed the proposed "cap and trade" program that is part of the administration's proposed tax increases. "Cap and trade" is the proposed tax on utility companies who produce carbon dioxide emissions. They will have to cut down on emissions or pay up. Practically speaking, most of them will simply pay up, given the cost of cutting down on emissions anytime soon.
Of course, that means they'll pass those additional costs on to their consumers - people who drive cars, take public transportation or use electricity - which means us. And here's where "Tax the poor" comes in - where the poor get to suffer even more than the rich.
In their analysis, the CBO includes a table that shows how the poor spend over 20% of income on energy - the biggest chunk being utility bills and gas for their cars - while the rich spend only around 4%. So logically if the cost of electricity goes up (and it will if the tax increases are passed by Congress), the poor will feel the impact of the utility rate increases more than the rich. If you do the math, it will impact the poor about five times more than the rich.
In other words, the poor will suffer disproportionately as a result of this one part of the new tax increases.
We've all seen a lot of complaining about the impact of the proposed tax increases on the rich. On one side, the claim is that it's unfair to target wealthier Americans; on the other side, the claim is that wealthier Americans shouldn't complain about shouldering a heavier tax burden.
Frankly, this debate is nothing new. And we suspect it will go on as long as government taxes some people more than others.
But it would be a real shame if the burden placed on poorer Americans as a result of "Cap and Trade" isn't addressed - if this just slips through the cracks. Doesn't this strike you as simply unfair?
I've read that "Cap and Trade" legislation may not pass. But who knows? First Health Care reform was a slam dunk, then it seemed to fade away, now it's back. Cap and trade kind of got lost in the mix. It may come back too. If it does, I just hope whatever form the bill takes considers this CBO report so the poor don't suffer as a result.
Government sure has a way of screwing up at times, doesn't it? "Tax the poor" is about as screwed up as it gets.
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