Thursday, May 07, 2009

Putting the president's tax cuts in perspective

President Obama's proposed budget will reduce federal spending by $17 billion, according the a administration's estimates. (Click here for a link to an AP story on the proposed cuts.)

That sounds like a lot of money. You or I could do a lot of stuff with $17 billion.

The cuts are part of the president's proposed in a $3.4 trillion budget. I can't fathom billion, so trillion is well beyond my scope. So I decided to cut it down to something that made more sense.

What would that level of a cut mean to someone who was making $50,000 a year, or even $20,000 a year? Here's what that would mean to your paycheck, assuming of course you got every dollar of that money and there were no such things as taxes.

Someone making $50,000 a year would lose $250 out of their paycheck. Total. For the year.

Someone making $20,000 a year would lose $100. For the year. Or to put that another way, it would be like losing about a day and a half of pay, assuming a 40-hour work week and working 5 days a week.

I wonder how many people who have been laid off or had to take weeks of unpaid furlough's would trade their circumstance this year for the sacrifice Uncle Sam may be asked to make in the next fiscal year?

Click here to download a pdf of the president's proposal.

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