Obama Did Cut Taxes For 95% Of Working Families. Why It Wasn’t Noticed
President Obama kept his promise to cut taxes for 95% of working families. Most Americans aren’t aware that it happened. That’s partly because state and local taxes have gone up as a result of less revenue sharing with the federal government (because of the Bush tax cuts).
Actually, the tax cut was, by design, hard to notice. Faced with evidence that people were more likely to save than spend the tax rebate checks they received during the Bush administration, the Obama administration decided to take a different tack: it arranged for less tax money to be withheld from people’s paychecks.
They reasoned that people would be more likely to spend a small, recurring extra bit of money that they might not even notice, and that the quicker the money was spent, the faster it would cycle through the economy.
So, economically, it was a good idea to cut taxes in this manner. Politically, not so much.