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Posts tagged ‘Fiscal cliff’

Democrats push for tax cuts they once opposed


By , Published: December 25

Democrats seeking a deal to avert the year-end “fiscal cliff” are trying to etch into stone the signature economic achievement of Republican President George W. Bush by permanently extending tax cuts enacted during his tenure.

President Obama has put the extension of the tax cuts for most Americans at the top of his domestic agenda, a remarkable turnaround for Democrats, who had staunchly opposed the tax breaks when they were written into law about a decade ago.

With Obama leaving his Hawaii vacation for Washington Wednesday evening and lawmakers returning Thursday, the main dividing line between Republicans and Democrats has come down to whether tax rates should increase for top earners at the end of the year, when the Bush-era tax cuts are set to expire. While Republicans want to extend all the cuts, Democrats are pushing to maintain lower rates on household income below $250,000. Those lower rates significantly reduce the taxes of nearly all American households that earn less than $250,000 — and many who earn more, even if tax rates are allowed to increase on income above that figure.
While it is increasingly unlikely that the two parties will reach an agreement to avoid the fiscal cliff before Jan. 1, it is all but certain that their ultimate deal, whenever it comes, will make permanent the lower rates for most Americans.

R. Glenn Hubbard, dean of the Columbia Business School and an architect of the Bush tax cuts, said it is “deeply ironic” for Democrats to favor extending most of them, given what he called their “visceral” opposition a decade ago. Keeping the lower rates even for income under $250,000 “would enshrine the vast bulk of the Bush tax cuts,” he said.

Democrats say they have reconsidered their opposition to the Bush tax cuts for several reasons. The cuts were written into law from 2001 to 2003 after a decade in which most Americans saw robust income growth. Over the past decade, by contrast, median wages have declined, after adjusting for inflation, amid a weak economy. Allowing tax cuts for the middle class to expire would further reduce take-home pay.

“We’ve had these tax cuts in place since 2001. The world changes, and the economy is where it is,” said Steven Elmendorf, who was chief of staff to former House minority leader Richard A. Gephardt (D-Mo.), a primary opponent of the Bush tax cuts. “With people’s economic status, we should not be raising taxes on people earning under $250,000.”

What’s more, income inequality has been growing. Sparing the middle class higher taxes while requiring the wealthy to pay more would tip the scales slightly in the other direction.

“The reason there’s been this movement toward broad consensus on renewing the tax cut for working- and middle-class families is that will give us a sharper progressivity in the tax system that is very much desired by Democrats and progressives who’ve seen an income distribution more and more distorted toward the wealthy,” said Betsey Stevenson, former chief economist in Obama’s Labor Department and a professor at the University of Michigan, who added that taxes may have to rise even more than currently contemplated to meet the country’s needs.

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Obama Refuses to Compromise with GOP


Obama Refuses to Compromise with GOP

President Barack Obama constantly talks about the need for Democrats and Republicans to work together and come up with a compromised plan to avert the fiscal cliff.  However, in his latest action, he has made it perfectly clear that he has no intention of compromising anything and fully expects Republicans to cave in and agree to ALL of his DEMANDS.  That’s why The Daily Caller referred to Obama as Demander-in-Chief.

House Speaker John Boehner (R-OH) has been caving in bit by bit to Obama’s demands, much to the ire of many Republicans.  In his latest compromised proposal, he has offered to raise taxes on everyone making $1 million per year and extending the debt ceiling by another $1 trillion.  The tax increases on the top earners would place most of them paying over 50% in federal, state and local income taxes and net the federal government an estimated $460 billion a year.

However, Boehner’s plan also called for spending cuts, which Obama keeps saying he’ll get to tomorrow, kind of like your kids will clean their rooms tomorrow, but tomorrow never comes.  A year ago when we were in the same situation, Obama promised that if the GOP accepted his ‘compromised’ plan then that he would address spending cuts after the first of the year.  That promise never happened and instead of trying to cut spending, he kept spending more and more.

In the compromised plan prior to this one, Boehner was offering to cut or eliminate mortgage interest and charitable donations tax deductions.  This would have cost the average American family a huge chunk of money and put thousands of charities out of business.

Boehner has been presenting compromised plans that go against almost everything the Republican Party stands for and many in the GOP are not pleased.  Boehner’s position as Speaker of the House next year is very much in jeopardy with the way he has been abandoning his party and constituents.  That wouldn’t bother me one bit and as Boehner has been a wishy-washy leader anyway.  I would much rather see someone like Paul Ryan or Darrell Issa replace Boehner as Speaker of the House as both men have the courage and backbone to stand up against Obama, the Democratic Party and their dictatorial demands.

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More Evidence Of President Obama Wanting to be “Dictator” Obama


Obama: Give Me Debt Ceiling Power Or I’ll Veto My Own Tax Proposal

Barack-Obama-as-Buzz-Lightyear-86467In case there is still anyone out there that continues to believe that the 2008 campaign lines that Barack Obama gave about changing the way Washington works, stopping “politics as usual,” and providing more transparency in government are true, then get a load of this. On Wednesday, Obama demonstrated just how partisan and how much of a power grabber he is. He indicated that if he were not given unlimited powers to raise the debt ceiling, apart from Congressional approval, that he might just veto his own tax hike proposal should it come to his desk.

As Obama addressed corporate CEOs at the Business Roundtable, he told them that business leaders “should not accept going through” another debt-ceiling crisis like the one that occurred in 2011, which caused stocks to fall and ended with the first U.S. credit rating downgrade.

He said that the Republicans using the debt ceiling as leverage, in order to get more spending cuts, is not only a “bad strategy for America,” but he was adamant that it was a game he would not play.

The Hill reports,

The president told the CEOs that a fight over the debt ceiling would cause more uncertainty for business. “We can’t go there again,” Obama said.

He also quoted Business Roundtable President John Engler, the former Republican governor of Michigan, who said the debt ceiling was “not a good weapon for anything except destroying our own credit rating.”

Obama’s comments drew a sharp rebuke from Republicans, who argue Congress’s role in raising the debt ceiling serves as a key check on excessive government spending. GOP leaders noted proudly they were able to force some $2 trillion in cuts during the debt-ceiling showdown last year.

“The president wants to have the ability to raise the debt ceiling whenever he wants, for as much as he wants, with no responsibility or spending cuts attached,” said spokesman for Senate Minority Leader Mitch McConnell (R-KY) Don Stewart. “This is an idea opposed by Democrats and Republicans alike; it’s a power grab that has no support here.”

We already know that Obama and the Democrats are not willing to compromise on anything. They even rejected House Speaker John Boehner’s proposal on Tuesday, which was blasted by conservatives. Obama is going to play hardball and the Republicans had better wake up to that. You’ve been dealing with the man for four years now.

Consequently, Obama’s own proposal could not pass either the House or the Senate, but apparently he wants to be the “Buzz Lightyear” of debt and demand the power, given to Congress in Article 1, Section 8 of the U.S. Constitution, and go from $16 trillion to “infinity and beyond!” Congress must keep him in check or it will most certainly spell the end for the U.S. economy.

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