Democrats have become eager—really eager—to do something about the Alternative Minimum Tax (AMT) before it forces millions of upper-middle-income Americans to pay more taxes this year.
Republicans, well, not so much.
That may strike a few people as odd, since Republicans have for years been calling for an end to the AMT, or at least reforming it or indexing it for inflation so that it doesn’t threaten to hammer more and more Americans every year. But those perplexed may not have seen the recent numbers from the Bureau of Labor Statistics (BLS).
According to the BLS, New Yorkers—and specifically those working in Manhattan—have the highest incomes in the country, making an average of $147,000 annually for the first quarter of 2007. That’s about $2,821 per week, a 16.7 percent increase from the previous year.
On Planet Earth, which is to say outside of New York City (and Washington DC), the average annual paycheck is more like $46,000, with only a 5.1 percent increase.
After New York City, the next four highest-income areas are Fairfield, Conn. (close to New York City) at $103,000; Suffolk, Massachusetts (which includes Boston) at $86,250; and San Francisco at $85,250.
Now, notice where these areas are located geographically. Right in the middle of some of the bluest land in the country.
Ironically, the class warriors in Congress—people who are always complaining about the Bush tax cuts for the rich and who want to eliminate those cuts—are moving into overdrive to try and cut an imminent tax hike . . . on the rich.
We can understand Republican foot-dragging. The Democratic drive for AMT reform has nothing to do with good public policy for the country. Democrats are just trying to protect their constituency—and their own political necks. Plus, the Dems are using the issue as a justification for pushing permanent tax increases to offset the cost of cutting the AMT.
Some are even willing to relax their adopted “pay-go” rules—which require Congress “pay for” any new government spending, usually by increasing taxes or reducing other spending.
But Republicans have little interest in saving Democratic necks these days. Having run against Bush’s “tax cuts for the rich,” Republicans seem more than happy to stand back and watch the Democrats squirm for not . . . cutting taxes on the rich.