tax cuts

Rep. Jim Moran On Fiscal Deal: 'We're Going To Look Back On This Night And Regret It'

Rep. Jim Moran (D-VA)

Last night, the House approved President Obama's fiscal deal, which would extend tax breaks for individuals earning up to $30,000 a month and enact a weak estate tax without resolving the debt ceiling or sequestration issues.

One of the lone progressive Democrats who opposed the deal was Rep. Jim Moran (D-VA). He gave an impassioned speech about how the deal is setting up three additional hostage situations because it does not resolve the debt ceiling, the expiration of the continuing budget resolution, or the sequestration. "We will look back on this night and regret it," he thundered:

MORAN: Many of us feel, certainly on this side, that the deficit does not matter, but it does matter because we have another deficit -- a deficit in the investment and education of our children, a deficit in the training and skills of our work force, and the physical infrastructure of our country. We will have none of those resources to make that investment after we make this vote tonight. And the problem is, we have set up three more fiscal cliffs. We 're gonna have to deal with the debt ceiling, We're gonna have to deal with the continuing resolution expiration, and we're gonna have to deal with the sequester. And all that's left is spending cuts. And all that's left to ask ourselves is, what programs do we cut and how deep do we cut them? We have to look back on this night and regret it, notwithstanding the fact that 95% of us will vote for it.

Watch it:

Recall that, under the terms of the deal, middle class Americans will actually see a larger tax rate increase than Americans earning $400,000 a year, thanks to the expiration of the payroll tax cut ...

Leading House Republican Says Obama's Deal Gave Away All His Leverage

Rep. Tom Cole (R-OK)

Today on MSNBC, leading House Republican Rep. Tom Cole (R-OK) said that Obama's tax deal -- that extends tax cuts even for people making $30,000 a month and enacts a weaker estate tax than otherwise would've gone into law -- has resulted in the President giving away all his leverage:

TOM COLE: Again, I would prefer not to raise taxes on anybody. But we protected almost every American. We did it at a higher income level than the President campaigned on. And again, frankly, we've denied him I think his most important piece of leverage in any negotiation going forward. So I particularly like that part. I understand unemployment extension. I prefer, you know, a more focused effort in that regard. But we do have parts of the country where that's necessary and it's a fair compromise. The entitlement issue, just too much to deal with I think in one piece of legislation. But again, still sequester is in front of us. The continuing resolution runs out the end of march and obviously the debt ceiling. All of those things honestly are Republican leverage not Democratic so I think there will be opportunities to deal with the spending issue next year. Honestly I expect that will be the dominant issue along with trying to overhaul the tax code going forward. So that's usually pretty good ground for Republicans.

Watch it:

 

Also note that Cole says he specifically thinks that now that Obama has given away his leverage, Republicans can go after "entitlements" -- meaning Medicare and Social Security benefits -- during the debt ceiling and sequester negotiations.

Under Obama's Tax Plan, Middle Class Will Get Higher Tax Increases Than Many Rich People

President Obama has endorsed a tax deal that would give individuals up to $400,000 an extension of the Bush tax cuts. The plan would also reportedly allow the rich to keep a lower estate tax than is currently planned for 2013 (55% for estates worth more than $1 million). This is a tax cut for many rich Americans.

Because the payroll tax cut is expiring and the Make Work Pay tax cut is not coming back, most working Americans will also see a tax increase. The most galling thing is that 98 percent of Americans will actually see a larger tax increase than some of the richest Americans. Working with our friends at the Center for Economic and Policy Research, we compiled the following chart to demonstrate this:

Our polling of swing states shows that a large majority of voters want to see taxes raised on incomes above $250,000.

Top Republican Hints That House Republicans Would Cave, Support Ending Bush Tax Cuts For Rich

Sen. John Thune (R-SD)

As the expiration of the Bush tax cuts inches ever closer -- they are set to expire on January 1st -- a number of Republicans are doing everything they can to convince Democrats to keep the tax reductions for the wealthiest Americans around.

Some have suggested a short-term deal that would extend the rates further. But appearing on Fox News yesterday, a top Republican -- Sen. John Thune (R-SD) -- suggested that enough House Republicans would support an agreement to end these top-tier tax breaks to get the votes to pass the body:

 

ANCHOR: Are Republicans willing to hold the line, to say to the President, I am sorry, we will never agree to a deal that involves an increase in taxes. Are they?

THUNE: I think any deal that passes up here that raises taxes...is not going to enjoy Republican support. Now, there may be enough Republicans that would vote for something like that to pass it in the House of Representatives, they need to get to 218 votes which assumes they get some Republicans --

ANCHOR: Well then it's done, right?

THUNE:  Well, we'll see. We don't know about that.

Watch it (the relevant segment begins at 4:00):

Recall that House Speaker John Boehner (R-OH) himself previously said that if the "only option" he had was to vote for middle class tax cuts, "of course" he would vote for them.

Democrats should take this as a positive sign and one reason they should not give in to Republican demands to extend the tax rates for the top 2 percent of Americans.

 

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