Once again, the Bush tax cuts have become a topic of division on Capitol Hill. Today, President Obama announced that he will be calling on Congress to pass a one-year extension of the tax cuts, but only on those for families making less than $250,000. Above that threshold, rates would increase to 1990s levels.
Republicans, meanwhile, are at odds with the White House and are calling for an extension on all of the Bush tax cuts, no matter what the level of income. Obama’s plan might not even be a huge hit with some Democrats in Congress, as they want the extensions to apply to all those under the $1 million a year mark. Many in Washington concede that this is a political maneuver, in an effort to steer the conversation away from jobs and the economy to the overall issue of tax fairness. Furthermore, it casts Republicans in a hyper-partisan, gridlocked and obstructionist stance for not being cooperative on a simple one-year plan for middle class Americans.
Data suggests that Obama’s one-year extension would cost $150 billion in revenue, but letting the other cuts expire would lead to $850 billion over the next decade. Does the financial math nullify the political nature of this announcement? What does this decision mean for you and your family? Will you be affected by this new policy? How are Republicans reacting to the announcement?
Rachel Smolkin, White House Editor, POLITICO
Darry A. Sragow, Attorney and long time democratic strategist
Jonathan Wilcox, Republican Strategist; former speech writer for Governor Pete Wilson