Plutocrats three phase austerity plan for America

A great, easy to understand how Democrats and Republicans are working together on destroying the Middle Class.

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The Bush tax cuts are now extended. What cost $3.4 trillion over the past decade, 80% of which accrued to the wealthiest households and U.S. corporations, will now cost another $802 billion over the next two years and a projected $4 trillion over the coming decade.

But the Bush tax cut extension just passed by a political elite increasingly united on economic policy—a ‘Repo-Demo’ Party dominated by corporate interests—is only the first of three phases in a new policy offensive designed to protect the incomes of the wealthy and corporate America for another decade, to be paid for directly by middle- and working-class America.

Phase two: draconian spending cuts

The second phase will likely be implemented in the next three months, before the ceiling on the federal debt has to be lifted. It will take the form of massive spending cuts in the U.S. budget, targeting Social Security and Medicare in particular.

Phase three: revising tax code to help the wealthy

As part of this general revision, the Bush tax cuts will likely be made permanent for the rest of the decade to come. In addition, personal income tax brackets for the wealthiest households will be reduced to no more than three, possibly two, with a top rate for the wealthy or no more than 28%, representing a return to Reagan years.

To pay for the tax code rewrite and even more concessions to wealthy households, investors and corporations, the middle class will pay more. Adjustments to the Alternative Minimum Tax, AMT, for the middle class will be phased out. And the mortgage interest tax credit will be eliminated in stages as well.

The key question: Will any jobs be created?

Corporations are today sitting on a cash hoard of more than $2 trillion, according to the business press, not investing or creating jobs. Why should increasing that hoard another $500 billion or so result in anything different? That’s the key question conservatives and the ‘Repo-Demo’ Party elite must answer—but are avoiding. That’s the question the media should be asking, but about which they remain conspicuously silent.

Obama’s 2011 ‘Stimulus 2’ will thus prove no more effective than his 2009 ‘Stimulus 1.’ The past decade has produced repeated tax-cut heavy policies targeting the rich and corporations: Bush II and a Republican Congress 2001-06. Bush II and a Democratic Congress 2006-08. Obama and a Democratic Congress 2008-10. And now Obama and a de facto Republican Congress.