Today in remarks on the economy, President Obama used softer words to spread the same message – taxes should go up only on those making $200,000 or more while making a veiled reference to Democrats having a mandate after Tuesday’s election.
Obama’s drew a line in the sand on tax policy. The President said “I refuse to accept any solution isn’t balanced” and continued by referring to his requirement that those families making more than $200,000 should be required to pay even more in taxes than they do today while others should see no changes to their tax liability.
Making a veiled reference to Democrats having a mandate after the election, Obama said “On Tuesday night, we found out that a majority of Americans agree with my approach” disregarding the fact that Republicans who oppose his plan were widely re-elected in the House and Senate.
Acknowledging that the “fiscal cliff”, put in-place by the White House’s proposal of sequestration as a budgeting tool, will damage the economy, the President said “If Congress fails to come to agreement on a deficit reduction plan by the end of the year, taxes on everyone will go up.” “Nobody, not Republicans, not Democrats want taxes to go up on people making less than $250,000 a year.”
Obama did also make remarks intended to show a willingness to compromise. “I’m not wedded to every detail of my plan. I am open to compromise” he remarked. But with hard lines on tax policy and no guidelines on spending cuts, compromise may be difficult.
Obama’s remarks also ignored the cost to the economy that his signature health care law, war on energy and tax proposals have had. A staggering number of companies have announced layoffs in the wake of his re-election. The President also clearly misunderstands how businesses make hiring decisions as he said that businesses should no longer be affected by uncertainty. Obama said that “business will know that consumers won’t see a huge tax increase” as if the taxation of the consumer base was a driving decision factor. The costs and additional taxes in Obamacare, defense cuts in sequestration and his war on traditional energy sources were often cited by American companies as reasons for layoffs and moving facilities overseas.
Despite the president’s push for a balanced approach, Obama pushed to have the tax increases go in now, while negotiating for an actual budget deal until later when he exclaimed “Let’s not wait! Even as we’re negotiating a broader deficit reduction package, let’s extend the middle-class tax cuts right now.” Obama pushed the Senate tax plan passed this summer that would continue the Bush tax cuts for families making less than $200,000 while letting them expire for small business owners and consumers that make more. The bill, S. 3412 entitled the “Middle Class Tax Cut Act” extends the Bush tax cuts for one additional year, but only for those individuals and families meeting the threshold.
Key provisions of the bill extend through the end of 2013:
- an increase in the American Opportunity tax credit
- an increase in the child tax credit
- increased earned income credit for those families with more than 2 children
- continues the practice of disregarding tax credits and tax refunds in determination of eligibility for federal assistance programs
- increases the exemption from the Alternative Minimum Tax which will currently hit middle-income families
- will reduce tax deductions for those making over the $200k and $250k thresholds