A recent report by Citizens for Tax Justice says the Bush tax cuts for the wealthy will cost us over $2 trillion over the period 2001-2010, with half of the benefits going to the richest 5 percent of taxpayers.  I’m no math genius, but even I can figure their half comes to about $1 trillion dollars.  Holy cow — that’s almost exactly the ten-year cost of the health care plan just passed by the House of Representatives!  I’ve got an idea: let’s get our money back by sticking the rich with the total tab for health care reform, while we restore some much-needed progressivity to the federal income tax, and give our economy a huge boost in the process.

Once upon a time in America, we had a fair, graduated income tax — the higher your income, the greater percentage you paid the IRS.  It meant average folks had enough income at their disposal to spend on consumer goods, save and invest, and buy their own homes.  It was one of the pillars we used to build the strongest middle class in the history of the world.

Then along came Ronald Reagan, who cut personal income taxes by 25 percent in 1981, and then whacked them again in 1986, lowering the top individual rate from 50 percent to 28 percent, and raising the lowest rate from 11 percent to 15 percent.  /Note: Reagan had help in this piece of Robin-Hood-in reverse from Democrats like Dick Gephart in the House and Bill Bradley in the Senate, cementing a Congressional tradition of bipartisanship in the screwing of the little guy./

George W. Bush did much more damage by doling out tax cuts that will cost us $2.5 trillion over the decade ending next year, with 50 percent of the money going to the richest people in our country.  Economist Lester Thurow called it “the greatest redistribution of wealth in history without a revolution. The result?  A humongous increase in the federal deficit, a recession that just keeps on giving out grief to working families, and a weakened  federal government that’s having to scramble to keep up with human needs.  

Now comes national health care reform, which the House bill proposes to pay for by splitting the cost between “savings” from wiping out Medicare and Medicaid fraud and inefficiency, and a surtax on individuals making more than $500,000 per year and couples earning more than $1 million — the upper 1.3 percent of taxpayers. The servants of the wealthy in the U.S. Senate are proposing to eliminate the House surtax on the rich, and replace it with a tax on so-called “Cadillac” health plans, which will be paid mostly by folks driving around in Chevy pick-um-up trucks and minivans.  /Note: The only real fun in the debate in the House was when Rep. Lloyd Doggett (D-Texas) said the Republican alternative plan — which would have covered only 3 million uninsured — was “skimpy as a hospital gown.”/

We should reject the House and as well as the Senate payment plans and stick the top 5 percent of taxpayers with the entire tab for health care reform, the $1 million they stole from the rest of us in what economist Lester Thurow once called “the largest transfer of wealth without a revolution in history.  Whatever “savings” we might be able to gain from eliminating fraud and inefficiencies in our  current health care plans for the elderly and the poor could be used for extending benefits beyond the 36 million uninsured covered under the House legislation.

Re-soaking the rich is only fair — they’ve become incredibly wealthier over the last 10 years, while most of the rest of us have become much poorer.  And they alone had money left over to buy into the stock market at the bottom. Doubling the surtax will also begin to get us back to a truly graduated federal income tax.  And because we will have dipped into their pockets, the wealthy will be forced to launch new entrepenueral schemes to replenish their bank accounts, creating new jobs and helping restore our economy as they gin up new piles of profits.

Is this a perfect plan or what?