My Life and Times

June 7, 2005
The Bush Economy

With all of the debate about taxes, the economy and domestic spending, it is hard to imagine anyone supporting the notion of taking money from programs like Medicaid and college-tuition assistance, increasing the tax burden of the vast majority of working Americans, sending the country into crushing debt - and giving the proceeds to people who are so fantastically rich that they don't know what to do with the money they already have. Yet that is just what is happening under the Bush administration. Forget the middle class and the upper-middle class. Even the merely wealthy are being left behind in the dust by the small slice of super-rich Americans.

In last Sunday's Times, David Cay Johnston reported that from 1980 to 2002, the latest year of available data, the share of total income earned by the top 0.1 percent of earners more than doubled, while the share earned by everyone else in the top 10 percent rose far less. The share of the bottom 90 percent declined.

President Bush did not create the income gap. But the unheralded effect of his tax policy is its unequal impact on the modestly well to do. By 2015, those making between $80,000 and $400,000 will pay as much as 13.9 percentage points more of their income in federal taxes than those making more than $400,000, assuming the tax cuts are made permanent. Below $80,000, most taxpayers will see their share of taxes rise slightly or stay the same.

Mr. Johnston's article quotes a prominent economist who argues that people care more about the chance to move from one income class to another (upward, of course) than about income distribution. But during the Bush years, the two main sources of class mobility - a good job and money for higher education - have increasingly failed to materialize for those who most need them. Last week's jobs report from the Labor Department confirmed that a strong labor market recovery has not taken hold. Wages for most working people failed even to outpace inflation in the past year.

That might be more bearable if things were rough all over. But the share of economic growth that is going toward corporate profits, which flow to stockholders and bondholders who are concentrated at the top of the income scale, is at historic highs.

Which brings us back to the super wealthy and the merely rich. The divide between rich and poor is unfortunately an old story, but income-class warfare among the top 20 percent of the scale is a newer phenomenon. One cause is that the further up the scale one goes, the more of one's income comes from investments, which under the Bush tax cuts enjoy about the lowest rates in the tax code. But many families making between $100,000 and $200,000 are not exactly on easy street. They don't face choices anywhere near as stark as those encountered further down the income ladder, but they face serious tradeoffs not experienced by the uppermost crust, particularly when hit with the triple whammy of college for the children, care for aging parents and preparing for their own retirement.

There is something deeply wrong about a system that calls into question a comfortable retirement or a top-notch education for people who have broken into the top 20 percent of income earners. It starts to seem politically explosive when you consider that in a decade, those making between $100,000 and $200,000 will pay about five to nine percentage points more of their income in federal taxes than those making more than $1 million, assuming the Bush tax cuts are made permanent.

This is not about giving wealthy people more money to invest back into the economy. At this level, it's really about giving more money to those who have nothing to do with it except amass enormous estates for their heirs. Fixing the problem will require members of Congress to summon the courage to say no to a president who wants more for the richest of the rich at the expense of everyone else. We're not holding our breath.

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Give it a hug: Dan Wheldon's face will adorn one section of the Borg-Warner Trophy following his Indy 500 win. -- Michael Conroy / Associated Press

Speedway likes look of future
Patrick, changes to 500 schedule appear to have increased interest


By Steve Ballard
steve.ballard@indystar.com
May 31, 2005


As the winning car and Borg-Warner Trophy were positioned at the yard-of-bricks finish line for what would be a three-hour photo shoot Monday starring newest Indianapolis 500 champion Dan Wheldon, the clouds from a morning rain shower departed and the sun came out over Indianapolis Motor Speedway.

It was a fitting metaphor for a month that ended with the Indy Racing League looking to a brighter future than might have seemed possible just three weeks ago.

Capped by one of the most entertaining and competitive Indy 500s in recent years, the month produced an array of engaging story lines and a new star in 23-year-old Danica Patrick.

After presiding over his first 500 as Speedway president, Joie Chitwood already was wearing a smile when news arrived that made it grow even wider.

Overnight ratings of ABC's telecast of the race were up 40 percent from a year ago and the 500 soundly thumped Fox's telecast of NASCAR's Coca-Cola 600 later in the day.

"Some things you can't control, but the things we could control, I think we did a really nice job," Chitwood said. "If you had asked me before this event and said, 'You can have anything you want,' I don't know that I could have asked for any more than what we got."

That was reflected in the 6.6 rating and 17 share, which went up to 8.8/21 in the last 15 minutes of the race when Wheldon and Patrick were battling for the lead. Patrick wound up fourth, the best by a woman in the event's 89-race history. She was named Rookie of the Year.

The NASCAR race, which began in Concord, N.C., about an hour after Wheldon took the checkered flag, drew a 4.8 rating and 10 share. With a record 22 cautions in 600 miles, it took 51/2 hours to complete.

IRL president Brian Barnhart agreed the national media frenzy created by Patrick was a major factor in luring viewers. But he is counting on all of what they saw to bring them back, starting in two weeks when the IndyCar Series season resumes at Texas Motor Speedway.

"I don't think I can ever remember seeing a better race here," he said. "We had 27 lead changes and 22 of them were passes on the racetrack. It was some of the closest, cleanest competition I have ever seen at Indy."

Several changes were introduced this May and all are likely to become permanent. The most popular seemed to be the move of Carb Day from Thursday to Friday, which with a full day of on-track activities and a Black Crowes concert drew a crowd estimated at more than 50,000.

"Makes you wonder why we waited 90 years to move it," said Ken Ungar, the IRL's vice president of business affairs.

At ABC's behest, the start of the race was pushed back an hour, to noon local time. It's too early to tell if that contributed to the ratings increase, but Chitwood said early reports from police indicated the extra hour helped smooth the traffic flow into the track.

Because of the state's move to daylight-savings time next year and pending Department of Transportation hearings that could result in a switch from the Eastern to Central time zone, Chitwood said the starting time for the 90th Indy 500 might not be set for several months.

The biggest disappointment for Speedway officials was the rainout of pole day. That postponed at least until next year the debut of a new qualifying format limiting to 11 the number of cars getting into the field each of the first three qualifying days. The idea was to inject more bumping into the process, and even with 22 cars on the delayed pole day, the format showed promise.

"I'm really excited to see what happens the first chance we get to do the 11/11 thing," Barnhart said. "It didn't really get a fair shake."

He held out the possibility of using Sunday and Monday for the first round of qualifying next year if Saturday again is rained out, but staffing and TV concerns make it unlikely.

"It's something we should consider," he said, "but there will have to be a lot of people in the room for that discussion."

The move of rookie orientation to the first two days the track was open might have held down the opening-day turnout, but by shortening the month for the veterans, fans who turned out later were treated to some of the busiest practice days in recent memory. In all, more than 37,000 miles were run in preparation for the race.

The Speedway won't sit quiet for long. The U.S. Grand Prix Formula One race is June 19 and the Allstate 400 at the Brickyard NASCAR race is Aug. 7.

Two drivers who won't carry away fond memories from Sunday's race, Bruno Junqueira and Larry Foyt, remained in Methodist Hospital on Monday for treatment of injuries sustained in separate crashes.

Foyt was fitted with a brace for a chip fracture in his lower spine and is expected to be released today. Junqueira will remain hospitalized through the end of the week after surgery to repair two fractured vertebrae.

Dr. Terry Trammell, who performed the four-hour surgery, found no additional spinal injuries and said Junqueira should be able to stand today.

The Brazilian, who was leading the Champ Car World Series points standings, will miss several races. Owner Carl Haas has little time to find a replacement with the Champ Car season resuming Saturday at Milwaukee.

He's No. 4


Dan Wheldon earned the fourth-most money among race winners.

Year Driver Earnings
2004 Buddy Rice $1,761,740
2002 Helio Castroneves 1,606,215
1997 Arie Luyendyk 1,568,150
2005 Dan Wheldon 1,537,805


Cashing in


A record $10,304,815 was awarded Monday night to the Indianapolis 500 field. Here's the breakdown, in finishing order:

Driver Winnings
Dan Wheldon $1,537,805
Vitor Meira 656,955
Bryan Herta 457,505
Danica Patrick 378,855
Buddy Lazier 288,805
Dario Franchitti 309,055
Scott Sharp 295,305
Tony Kanaan 467,105
Helio Castroneves 277,805
Ryan Briscoe 273,555
Ed Carpenter 258,305
Sebastien Bourdais 234,555
Alex Barron 254,805
Adrian Fernandez 226,305
Felipe Giaffone 247,305
Jaques Lazier 219,305
Kosuke Matsuura 236,305
Roger Yasukawa 233,305
Tomas Enge 232,055
Tomas Scheckter 257,305
Patrick Carpentier 231,055
Jeff Bucknum 222,555
Sam Hornish Jr. 391,455
Scott Dixon 225,805
Richie Hearn 202,305
Kenny Brack 275,805
Jeff Ward 194,805
A.J. Foyt IV 218,805
Darren Manning 212,805
Bruno Junqueira 192,205
Marty Roth 195,305
Jimmy Kite 210,305
Larry Foyt 189,305