Do the Bush tax cuts help the economy or not?

The 10-year-old tax cuts are sparking yet another political standoff, with Republicans countering Obama, saying that letting any tax cuts expire would cost jobs

President Obama called on Congress to pass a temporary, one-year extension of the Bush-era tax cuts for people who make less than $250,000 a year, in Washington on July 9.
(Image credit: AP Photo/Susan Walsh)

On Monday, President Obama called on Congress to temporarily extend the Bush-era tax cuts for people with incomes of up to $250,000 a year while allowing the upper-income tax cuts to lapse. All of the cuts expire at the end of the year, at the same time hundreds of billions in spending cuts are set to kick in — an economic train wreck that Washington has dubbed the "fiscal cliff," or Taxmageddon. Republicans say Obama's proposal raises taxes on the rich, and amounts to class warfare. "But the tax debate isn't really about whether we should consume the delicious, delicious bodies of the rich, or even whether we should seize their money and give it to the peons," says Jonathan Chait at New York. Beneath the well-worn politics of the Bush tax cuts "there's a straightforward macroeconomic debate going on here." Are the Bush tax cuts helping the economy, or just helping the rich?

Low taxes for the wealthy help only the wealthy: Taxes on the rich and on investment income are already "at historic lows," and where has that gotten us? says Pat Garofalo at Think Progress. The rich are thriving, the rest of us are struggling, and "the job creation that was promised by the Bush administration" never materialized. That's not surprising: Historically, economic growth and job creation have been much higher when the top marginal tax rates are higher, too. So ignore the GOP's "fearmongering" claims about job-killing tax hikes on the rich: There's "no evidence backing them up."

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