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Monday, July 17, 2006
Wealth/Income Trends Reported In Wall Street Journal
A great article (sub. required) appeared today in the Wall Street Journal sheading light on another trend that can be seen within the new deficit projections released last week by the administration. The Journal reports that the bump in revenues recently actually showcases a growing economic inequality in our country:
While tax revenue is growing far faster than the Bush administration forecast in its budget projections in February, the nation's economy isn't.
What has changed isn't the size of the economy, but how the economic pie is divided. The share of national income going to corporations and the wealthiest individuals, already large, has expanded, while the share going to typical wage earners has shrunk. Because corporations and the wealthy generally pay income tax at higher rates than does the typical wage earner, that shift benefits the federal Treasury.
So the end result of the Bush tax cuts has been that the economy has expanded, but has only benefitted those at the very top of the economic ladder - the people least needing help in times of recession. While many have criticized the administration's policies for having the wrong priorities, now there is actual proof that the administration's policies almost exclusively benefit the wealthy.
Posted by Adam Hughes
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