Ten Years of the Bush Tax Cuts Benefiting the Rich
On June 7, 2001, President George W. Bush signed into law the Economic Growth and Tax Relief Reconciliation Act, the first of two "Bush tax cuts." That measure reduced the top income tax rate from 39.6 percent to 35 percent, and reduced capital gains and estate taxes. In the 10 years since the first Bush tax cut went into effect:
The richest Americans received the most benefit from the Bush tax cuts.
- $520,000: The average tax cut received by the top 0.1 percent of Americans, those making more than $3 million a year. That is over 450 times the tax cut received by an average middle-class family.
- The middle 20 percent of wage earners (making between $40,000 and $70,000) received less than 11 percent of the total Bush -era tax cuts.
- The bottom 20 percent (making less than $20,000) received only a 1 percent share of the Bush tax cuts; 75 percent of these low-income families saw no tax benefit at all.
- The average middle-class family received one-eighth of the tax breaks that a family in the top 20 percent of income earners received while the average working-class family reaped less than one-hundredth of the average tax cut received by a family in the top fifth of earnings.
Source: Economic Policy Institute
The middle class has fallen behind as wealth has been transferred to those at the very top.
- The top one percent of the population enjoyed 65 percent of the income growth between 2002 and 2007.
- Median household income in 2009, $49,777, was 5 percent below what it was in 2009, adjusted for inflation.
- By contrast, the nation's top 400 taxpayers reported an average adjusted income of $108 million in 2008, 56 percent higher in real terms than in 2009.
- In 2000, 11.3 percent of the population was in poverty. By 2009, that percentage had increased to 14.3 percent.
- In 2000, 33.7 percent of the population earned less than $35,000 a year (in 1999 dollars). In 2009, that percentage was up to 36 percent.
The Bush tax cuts did not create a jobs bonanza for middle-class workers.
- Job growth between 2000 and 2007 was the weakest in any business cycle since the 1950s; job growth was only one-third of the rate seen between 1989 and 2000.
- One in three manufacturing jobs has been lost (from 17.3 million to 12 million) between 2000 and 2008; one in four goods-producing jobs have been lost (from 24.6 million to 18.9 million), and 900,000 construction jobs have been lost since 2001.
- 8 million: The number of jobs lost during the recession that started in 2008.
- Three years is the minimum time it is projected to take to gain back the jobs lost in the recession, if the economy grows at a rate of 300,000 new jobs added a month.
The Bush tax cuts is at the root of today's deficit problem.
- The surplus in the fiscal 2001 federal budget was $127 billion. The 2010 budget had a budget deficit of $1.3 trillion. The long-term national debt more than doubled from $5.6 trillion in 2000 to $13.6 trillion in 2010, mostly under Bush's watch.
- Federal tax receipts in 2010 were 14.9 percent of gross domestic product . In 2000 it was as high as 20 percent.
Corporations have escaped paying their fair share as a result of the Bush tax cuts and other tax policies.
- Twelve top corporations paid no taxes or actually received money from the IRS between 2008 and 2010. The list includes Boeing, Verizon, Dupont, Yahoo, IBM, Wells Fargo, American Electric Power, Exxon Mobil, FedEx, General Electric, Honeywell International, and United Technologies.
- $62.4 billion was reaped in subsidies by these twelve companies over the three-year period, even as they paid no taxes on $171 billion in profits.
Source: Citizens for Tax Justice