Bush's War on the Middle Class

Bob makes an excellent point in the post below. Just to drive the point home, you may wish to peruse this article in the NYT today about changes the Department of Education has made to the college financial aid formula since 2000.

According to the article, two primary changes are working together to drive up the size of the annual parental contribution by thousands of dollars for median income families:

1. The Pell Grant system has substantially reduced its deduction for state income taxes, as an explicit cost-cutting measure;
2. The DOE has significantly reduced its long-term inflation forecast from years past.

The impact of the latter change is subtle but easy to understand: when inflation is lower, families need to save less for retirement, so they can "afford" to spend more sending their kids to college.

Note the coincidences here (because in politics, coincidences are about as likely as the tooth fairy): (1) States with higher income tax are inevitably blue states; and (2) The change in the inflation forecast, just like the Pell Grant rules revision, serves to decrease government spending - useful in these times of roaring budget deficits.

Putting it all together: Bush is soaking the middle class (esp. those in Blue States) in order to make up for a budget that has been busted by income and estate tax cuts for the wealthiest 1%.