Tax debate is over 1 butler or 3

For all the superheated rhetoric of yet another election cycle, it’s as clear as ever that the Republican and Democratic parties in Washington pretty much support the same economic policies. Indeed, any honest perusal of congressional votes proves that the party establishments are roughly the same when it comes to financial deregulation (less of it), job-killing free trade (more of it), bailouts (more of them) and corporate taxes (less of them).

Politicians and partisan media outlets deny this obvious reality, of course. But they do so because they have a vested interest in the red-versus-blue “polarization” narrative from which they generate campaign contributions and ratings, respectively. It’s also why more Americans are tuning out of politics.

That said, if you are still gullible enough to believe the illusion of huge differences on economics, behold the “debate” over taxes.

President Obama kicked it off with his claim last week that he wants to stop “another tax cut for the wealthy.” As supposed proof, he asserts that by proposing to extend all of the Bush tax cuts except those applying to top marginal rates, he will make sure high-income earners will “go back to the income tax rates (they) were paying under Bill Clinton.” In response, Republican presidential nominee Mitt Romney, who wants every Bush tax cut extended, claimed Obama “plans on extending (the tax cuts) just for certain classes of Americans.” Almost every news outlet echoed it all verbatim.

There’s just one problem: Obama, Romney and the media are all lying.

Because of America’s progressive tax system, all taxpayers under Obama’s plan – including individuals making more than $200,000 and couples making more than $250,000 – will get a tax cut on income up to those thresholds, respectively. This means that Obama’s initiative, which would cost $150 billion, will give, on average, a one-year $20,130 tax cut to the top 1 percent of income earners. Meanwhile, the $210 billion Republican plan would give that income group a $70,790 tax cut.

In other words, this is a minute dispute over whether the tax code should give each of those households the equivalent salary of one butler (Obama’s plan) or three butlers (Romney’s plan). For every other income group, the two proposals are identical.

Pretending this is some big divide is a farce. Both parties are proposing to enrich the already rich while hiding the two-headed monster behind a mask of conflict.

Unfortunately, that monster is still under there – still rigging the economy against us.