On the heels of a State of the Union that promises to address income inequality and a broken tax system, National Journal reports on the Democratic plan to revive a surtax on annual incomes greater than a million dollars:
Democratic members of a conference committee working on a long-term extension of a payroll-tax holiday and other programs will urge a surtax on incomes of more than a million dollars a year to pay for the bill when talks officially start today, said Senate Majority Leader Harry Reid, D-Nev., on Tuesday.
It should be said that if Democrats are going to push a tax increase—even a popular one—they should aim to do a little more than just offset the cost of stimulus. Unemployment is still above 8 percent and the bond markets are happy to lend us money at historically low rates. Rather than offset the cost, we should just pay for the payroll-tax holiday with debt and use the funds raised by a millionaire’s tax to boost food stamps and unemployment insurance. Even better, we should just give people money and let them spend it.
Of course, at the moment, both policies are outside the realm of the possible. But it’s always worth noting that we could do so much more to help the economy but choose not to.