“My stance is that the Bush-era tax cuts contributed to the deficit, did not create any jobs and that they should be repealed,” Speaker of the House Nancy Pelosi said at her weekly briefing. House of Representatives leader Nancy Pelosi said on Thursday she backs letting lower tax rates for high-income earners expire at year-end, despite opposition by several Senate Democrats who argue the economy is too fragile for higher taxes.
Source – Real Clear Politics – 7/22/10
It’s sort of like when you are a teenager and came home drunk after a party. Your Dad was waiting at the door and caught you off guard. You know you need a story, and you know that the story you come up with sober the next morning is going to be much better. But its game time. You have to say something, so you say something that makes no sense, and hope that Mom is in a better mood in the AM, and Dad has already left for work.
That’s kind of how the House Leadership sounds as they walk back 10 years of rhetoric on the Bush tax cuts. Democrats have been talking for years about how bad the Bush tax cuts have been for the economy. They increased the deficit (very true) and they only benefited the wealthy (very untrue). But now all of a sudden, in an election year, these tax cuts seem to have benefits to the middle class, though just a few months ago they only benefited wealthy Americans.
Extending the tax cuts for top wage earners would keep an additional $676B over 10 years in the hands of citizens and in the public sector. For an administration whose stimulus has failed to create jobs, for an administration whose borrowing money from China to pay for unemployment benefits, you would think they would want those American dollars out in the American economy.
And to think that the reason not to do this is that wealthy American’s save too much. As if savings were a bad thing. Saving to the affluent means putting money in the stock market or real estate, it doesn’t just go into a mattress. Both create momentum in the economy. Remember also that wealthy Americans are generally small business owners who create jobs.
I would support not extending the tax cuts because the right thing to do is to raise revenue and borrow less from China. I can’t be a hypocrite now about reducing the deficit.
I would also support extending the tax cuts across the board based on the reasoning that we need to pump stimulus into the economy.
What I cannot support is the concept of the government choosing who gets taxed based on ability to pay, and expanding the entitlement and wealth re-distribution state.
My opinion – we should let the tax cuts expire for all Americans and keep the AMT – we have to pay for our past and future sins of overspending.
We the people must understand there is a price to pay for expanded government services. That price is higher taxes. Maybe if we feel the pain of higher taxes, we will be willing to part with the services and the associated dependency that comes with expanded government.
What do you think?
Guest Blogger Jeff