Looking back at the fiscal cliff negotiations, Jamelle Bouie is disappointed by the narrow focus of the debate:
I’ve said this before, but it makes no sense to include all income above a given limit in the same tax bracket. In 1960, there were 17 brackets above $35,000—roughly $250,000 in today’s dollars—going up to $400,000 in annual income, or $3 million, adjusted for inflation. Now, there’s a single one.
This presents an obvious problem for liberals—by placing every high income person in one bracket, it binds the interests of the sorta-rich, the rich, and the super-rich. Instead of a small number of truly wealthy people pushing for lower tax rates, you have a broader coalition of the well-off. Which is to say that if tax reform is on the table this year, then there needs to be a push for more brackets at higher incomes.
Only if tax reform means further complicating the code for more progressivity. My priority is simplicity and transparency. Drum, meanwhile, posts the above helpful chart:
Who were the biggest winners from the fiscal cliff deal? The invaluable Tax Policy Center has a preliminary analysis up, and it shows how much various income groups will save as a result of the deal. (These are savings compared to going over the cliff and letting the Bush tax cuts expire completely.)