Deficit problem aggravated by tax-cut extension

Gary Musser, Las Vegas

Wednesday, Dec. 8, 2010 | 2:02 a.m.

Are my eyes deceiving me? I thought our legislators were supposed to be helping to solve our deficit problem. However, what appears to be the deal for the Bush tax breaks is anything but.

First, the good news. Unemployed folks are going to get some relief. Republicans have been saying that we have to pay for such outlays. Yet they stonewalled President Barack Obama into keeping the tax breaks for the wealthy.

Studies by E.N. Wolff have showed that in 1976, the top 1 percent of our country owned 19.9 percent of our wealth. But that 19.9 percent of our wealth — held by the top 1 percent — had ballooned to 34.6 percent by 2007. That is, the top 1 percent of our country now owns about one-third of our wealth.

Clearly this is not healthy for a democratic system, and it is just to have the wealthy pay a fairer share. But there is more. Republicans have been trying to starve the Social Security system for years. Yet part of the deal is to cut Social Security payroll taxes. Thus, Social Security will go further into the hole.

Allowing this cut in payroll taxes will put more money into spenders’ hands, which we need in the economic downturn, but it is unpaid for. Clearly, the right way to have funded an extension in unemployment benefits (for individuals whose jobs likely were outsourced) and to temporarily cut back on Social Security withholding would have been to limit the Bush tax breaks to the middle class, those who will spend much of what they get back.

But Republicans wouldn’t have not any part of it. Instead, they want the wealthy to help the country break the bank and add further to our deficits.