Bush’s to s newly proposed tax cut Essay
Bush’s to s newly proposed tax cut
Bush’s tax cut plan comprised a number of intiatives which were based on the General Tax Cut Plan proposed by administration in 2001 and further comprised those amendments that have been submitted to redefine priorities. The integral part to the plan is ‘the smaller tax cut’ which was included in a $2. 2 trillion budget for fiscal 2004 that the Senate adopted with restrictions. In general terms, Bush proposed to reduce taxes by $726 billion over the next decade. The House Plan with which GOP came out to the Senate voting on March 25, 2004 proposed to treat the devidents income like capital gains.
They report double taxation practice wherein devident income is a subject to taxation as a capital gain and then as a individual income. After devident income is equaled to capital gain the tax on capital gains drops to 5 percent for lower-income people and 15 percent for upper-income taxpayers. “When applied to dividend income, that is less than half the tax high-income individuals currently pay. ” The centerpiece of Bush proposal was retained but the the amount was seriosly reduced. Instead of $726 billion, Senate could adopted a $422 billion in new tax cuts and $20 billion in aid to the states plan.
In addition to it, Senate is bound to find nearly $92 billion to offset the new tax cut. “The Senate adopted a complete but temporary elimination of tax individuals pay on corporate income. The amendment cuts in half the tax individuals will pay on dividend income for 2003 and eliminates it from 2004 to 2006. The tax would then be reinstated for 2007. ” Actually, the Republicans gained $350 bilion Plan instead of that initial of $726 billions but nevertheless, were in position to celebrate temporary victory: the tax cut scenario is to be functioning for at least 2 years and the GOP scored one more point in eventual Presidential Campaign.
The shaky balance of the Senate was redressed in favour of Republicans only by $20 billions concession to state budgets and ‘Vice President Dick Cheney casting the tie-breaking vote on the amendment, which passed 51-50. ” The uncertainty around the cost of rebuilding Iraq, the Presidential request of $74. 7 billion emergency funds “to help pay for the war, anti-terrorism efforts and foreign aid” and the need to allocate the money to the financially strained Social Security retirement system were the main issues in charge of the Bush’s plan being slashed to more than double.
Aristotel’s idea has got some general implications on the subject. First, “Nicomahean Ethics” deals with categories relevant for that case. Voluntary – Involuntary deed, Exesses and the Mean, the nature of Choice, Temperence, Self-Indulgence, the less of two evils. Book 4 of the work adresses the key categories and their interrelation with regard to the finacial matter. Liberality, Prodigality, Meanness, and Magnificence provide a vocabluary within which the research on how Aristotel’s concept would address the specific issue could be completed.
For example, “the characteristics of prodigality are not often combined; for it is not easy to give to all if you take from none; private persons soon exhaust their substance with giving, and it is to these that the name of prodigals is applied — though a man of this sort would seem to be in no small degree better than a mean man. For he is easily cured both by age and by poverty, and thus he may move towards the middle state. ” Aristotel praises Liberal man who gives to the right amount to the right hands, and who “will also take the right amounts and from the right sources”, though he is inclined to refrain from taking.
The exessive giving is characteristic of the meanness while exessive spending – of the progigality. The latter deemed not to be the mark of ignoble man but rather a sign of follishness, nevertheless, it is valued much higher then the other extremity – meaness. The potential outcome of prodigality and its ethical implication are at length presented in Aristoteles. The Liberal man is referred to as an epitome of stateman virtues. The virtue of bravety as in Book 3 may comprise the fear when its reasonable to take precautions and the fear itself is a “right one”, springing from the “right motives”.
But it is only the man who feel confidence at the right conditions and fears in the right way and from the right time that might be called Brave. Thus, liberal man espouses the generocity as well as fear of poverty and that makes him continent and dispose peole to him. The Liberal decisions is ultimately resonable and noble decisions which concerns the money matter. Thus, Aristotel ethical insight might elucidate some aspects of taxation program and consider the situation in the terms of Adhering to the Mean line Principle as well as in th terms of the maximum public good.
“Liberality” is a term that includes the continency and usefulness to society and I will use it as general term which is applied to a reasonable politician. ”And the liberal are almost the most loved of all virtuous characters, since they are useful; and this depends on their giving. ” (p. 38) Aristotelian logic suggests that in the state of war public obligation and the nation’ spirit should rise. It’s a virtue of human character to courageously fight the enemy and its the public support to this endeavor that is deemed to be obligatory.
Since the formal state of war shoulders some obligations upon the population, the potential freedom to act of the President is virtually unrestrained. Thus, the actions he will hold are going to be voluntary and devoid of crucial extraneous constraints and agent (President and GOP) will contribute to the decision. The end, then, being what we wish for, the means what we deliberate about and choose, actions concerning means must be according to choice and voluntary. Bush has two aims: to be provided for vast military operation now and then and to revive economy slackening down.
The funds are needed for the first, the tax (and other) incentives for the second. The aims, with regard to what they predicate, are mutually exclusive for the prolonged army operations demand funding while business demand the tax ease, which means the shrinkage of the budget. The mean he has chosen to satisfy both ends is tax cut. It will have an immediate effect of lessening of the sums available for the war unless they are to be taken from elsewhere. The Aristotelian logic suggest: “With regard to giving and taking of money the mean is liberality, the excess and the defect prodigality and meanness.
In these actions people exceed and fall short in contrary ways; the prodigal exceeds in spending and falls short in taking, while the mean man exceeds in taking and falls short in spending. ” (p. 20) This practically means that spending should be balanced against the revenues gained. If the budget revenue are to decrease then the spending are also to decrease proportionately. If one incites the budget shrinkage one, reasonably, anticipates that he will need less money and, in this way, his action is substantiated.
But if one needs the amount of money by far exceeding that which he had before there is no use in tax cut. The mutually contradictory aims demand resolution of the case in favor of one of them. I think Aristotle will suggest that tax cut initiative is favourable for business in the long run, thus, it is necessary. But it will compromise the state’s ability in the other domains at least before the time when reform pays off. If there be any hidden resources to compensate the momentarily loss, the tax cut is tolerable.
But the war issue is the access in another extremity – prodigality. Its is hard to patch up the outcomes of the two incentives taken simultaneously. Thus, timing is a matter. The war should be brought to the end and only after the tax cut be implemented. The position of Republicans on the project was unequivocal. “Four days after rejecting a similar proposal by a 62-to-38 vote, the Republican-run Senate voted 51 to 48 to reduce the size of the tax cut to $350 billion. ” The first variant of a plan fell through with many Republicans voting against it.
The second draft was adopted with two Democrats voting for the plan offsetting three Republicans voting against it. The Bush’s plan draws on the experience of 1980s Reigan politics with deregulation, global trade and 25 percent tax cut. The military expenditures that time were one of the highest in American history safe for the time of war. GOP ascribes the economics effectiveness to tax relief, creating a new jobs and Tax Fairness. The military expenditures seem to have no bearing on the revival of economics.
To give a sacked economy a “second wind”, leaving more money to consumers and entrepreneurs, and to eliminate existing tax inequities – these are two primary aim of plan. The President emphasizes that Plan is about productivity as much as tax fairness (“people”). The incentive with a “heart” seems to be the right catchword. The heart of the present Plan comprised the initial Bush’s Tax Cut Plan 2001. It included doubling the child tax credit to $1,000 per child and applying the credit to the Alternative Minimum Tax (AMT), reducing the marriage penalty by reinstating the 10 percent deduction for two-earner couples;
Eliminating the death tax and Making the Research and Experimentation (R&D) tax credit permanent, replacing the current tax rates of 15, 28, 31, 36, and 39. 6 percent with a simplified rate structure of 10, 15, 25, and 33 percent, cutting the rate of marginal tax. The budget surplus US experienced then made such radical measures possible. The current Plan seems to be dis-heartened: now that Senate imposed a $350 billion cap, Bush seems to have retained the most valuable element – taxation of dividents and capital gains. All that tax releif now is about sacked economy.
The GOP adheres to the tax relief policy and still seems to extoll its benefits but the imposition of the limit made it focuse on the Grand issue. The Democrats voted against the present Plan proposal on the ground that $350 billions is still too much. The problem with Democrats is basically twofold one. Democrates advocate the idea of the balanced budget. They would rather curtail spending to avoid the deficit. But it is the general stance inspired by many mischieves of the present administration that makes them cautious in monetary affairs.
The original idea of the tax cut has found the endorsement within democrats. But it is the content of the Plan that sidled Democrats away. The “heart” of the Plan 2001, viz. the child tax credit, business investment incentives and a tax rebate for families is consonant with what Democrats deems to be their purview. They would endorse it no matter who proposed them. Actually, the Senate Democrates’ $152 billion plan which failed with 54-46 vote with four Democrats voting against it and one Republican voting for it was a good try.
From the one hand, Democrats vote down the Bush’s plan out of budget deficit considerations but from the other, they try to push forward the salient part of Bush’s 2001 Plan as their own initiative. That seems to make sense because their initiative is less money consuming. But I think that priorities is main the matter. Both Republicans and Democrats face the slackening economy and try to find solution. The GOP sees solution in a winning combination of triumphant war and corporate gains tax cut which is basic to economic revival.
Democrats wish to curtail military expenditure, leave off the burden of vast National security expenditures, to government involvement with middle and low class problems and, to crown all, incorporate some economic incentives of the GOP. The tax cut Plan of 2001 seems to meet the goal of economy revival. It is reasonable that the Plan was implemented. As soon as budget reflexes, among the other, the continence of the authority, the current budget situation suggests a steep flight to the “Prodigality” extremity. Imagine a man who spends and gets a public appraisal while taking less then he needs; he will be ruined in a while.
Either the funds he raises will increase to eventually balance his demands or he has to balance his demands against the sums available or, at maximum, little more. But the Aristotelian ethics is about virtues and modesty and fairness and charity are among them. I think the best way to fight crisis is help the strong in the reverse proportion to their strength and to the weak in direct proportion to their strength. The imposed cap reflected the power balance: the GOP pushing forward needed, but untimely proposition while the Democrats imposing limits.
If the parties were in the reverse position, I think that Aristotle would cast his voice for the Democrats Plan and military expenditures curtail, while, at the same time, imposing, imposing limits to leave the space for business incentive as the reasonable GOP members will in this position do. The ethical aspects in budget planning are one of the prominent factors. It is ethics that moves people when they say: “The government is no position to protect us with this tactics. And, further, the President has no rights to ascribe the economy further slackening down to the war and international market situation.
It was his decision about war, which influenced the situation on global markets, and it was his conduct that perpetuates terrorism he was to fight, thus, exacerbating the existent economic problems. The Ethical Stance, especially the one which draws on the work of one of the most prominent thinkers, enables one to discern the virtue from the vice and the self-fulfilled prophecy from the natural disaster one could not resist. Though it also emphasizes a balanced approach within which the both positions in the case seem to have some sense in it, the matter is to discern the corrupted and flawed reasons from reasonable ones.