Big Tax Cuts In The Works
Aiming to foster bipartisan support for his record-setting economic stimulus, President-elect Barack Obama plans to propose huge tax cuts for businesses and middle-class workers that will total about 40 percent of the package, or up to $310 billion, congressional officials said.
The revelation is part of an intricately orchestrated rollout of the plan that includes an appearance by Obama on Capitol Hill on Monday and a major speech about the economy later in the week.
Obama plans to ask Congress for a stimulus package of $675 billion to $775 billion, so the planned tax cuts will total about $270 billion to $310 billion, the officials said.
Obama strategists say he wants to get 80 or more votes in the 100-member Senate, and the emphasis on tax cuts is a way to defuse conservative criticism and enlist Republican support.
But officials say the tax cuts will be based on historical and empirical evidence of what works, not ideology. Rather, the targeted tax cuts will be designed to stimulate job growth in the private sector and help middle class families, the officials said.
For families, the tax cuts include the $500 Making Work Pay payroll tax credit Obama proposed during the campaign.
For businesses, the tax cuts would include breaks for small employers and a "new jobs credit."
Obama is scheduled to meet Monday with congressional leaders and will update them on what economists have told him about the country's financial outlook, stressing the imperative for action and his eagerness to work with them on the specifics.
While meeting with the leaders, Obama plans to say that a significant crisis needs a significant response, but one that is disciplined and targeted. The test for components of the stimulus plan will be whether they create jobs, jump-start the economy and lay the foundation for significant long-term investment.
Obama will emphasize his desire for transparency, with oversight and strict accountability, aides said.
Robert Gibbs, the incoming White House press secretary, told reporters as they flew from Chicago to Washington with Obama on Sunday evening: "We've seen Christmas sales, consumer confidence and obviously upcoming job numbers which underscore that a very serious situation has only gotten worse and isn't likely to get better any time soon."
The Labor Department is releasing figures Friday that could show the country's job losses last year were the worst since World War II.
Later in the week, probably Thursday, Obama plans to give a speech in the Washington area taking the case for his package directly to the public, emphasizing the urgency of the crisis and the fact that unemployment could slip over 10 percent if decisive action is not taken.
Obama will talk about the economic crisis and the response it requires, and the setting will be a serious one that will make the appearance very different from a campaign speech, aides said.
The speech is designed as a contrast to the approach taken by President George W. Bush, who has been criticized for not sufficiently explaining his solutions to the economic crisis, including the Wall Street bailout that has now been extended to automakers.
Aides described the speech as part of a carefully planned effort to sell the stimulus package to the country, including nationwide travel by Obama and his inner circle.
About 10 percent of the stimulus package will consist of expansion of unemployment insurance and COBRA health insurance for people whose coverage might otherwise be terminated.
The package also consists of infrastructure investments such as roads and bridges; long-term investments in energy, health care and education; and aid to states, such as more generous Medicaid reimbursement rates.
The proportions those measures will take in the final passage have not been specified.
By Mike Allen
? 2009 POLITICO
The Politico The revelation is part of an intricately orchestrated rollout of the plan that includes an appearance by Obama on Capitol Hill on Monday and a major speech about the economy later in the week.
Obama plans to ask Congress for a stimulus package of $675 billion to $775 billion, so the planned tax cuts will total about $270 billion to $310 billion, the officials said.
Obama strategists say he wants to get 80 or more votes in the 100-member Senate, and the emphasis on tax cuts is a way to defuse conservative criticism and enlist Republican support.
But officials say the tax cuts will be based on historical and empirical evidence of what works, not ideology. Rather, the targeted tax cuts will be designed to stimulate job growth in the private sector and help middle class families, the officials said.
For families, the tax cuts include the $500 Making Work Pay payroll tax credit Obama proposed during the campaign.
For businesses, the tax cuts would include breaks for small employers and a "new jobs credit."
Obama is scheduled to meet Monday with congressional leaders and will update them on what economists have told him about the country's financial outlook, stressing the imperative for action and his eagerness to work with them on the specifics.
While meeting with the leaders, Obama plans to say that a significant crisis needs a significant response, but one that is disciplined and targeted. The test for components of the stimulus plan will be whether they create jobs, jump-start the economy and lay the foundation for significant long-term investment.
Obama will emphasize his desire for transparency, with oversight and strict accountability, aides said.
Robert Gibbs, the incoming White House press secretary, told reporters as they flew from Chicago to Washington with Obama on Sunday evening: "We've seen Christmas sales, consumer confidence and obviously upcoming job numbers which underscore that a very serious situation has only gotten worse and isn't likely to get better any time soon."
The Labor Department is releasing figures Friday that could show the country's job losses last year were the worst since World War II.
Later in the week, probably Thursday, Obama plans to give a speech in the Washington area taking the case for his package directly to the public, emphasizing the urgency of the crisis and the fact that unemployment could slip over 10 percent if decisive action is not taken.
Obama will talk about the economic crisis and the response it requires, and the setting will be a serious one that will make the appearance very different from a campaign speech, aides said.
The speech is designed as a contrast to the approach taken by President George W. Bush, who has been criticized for not sufficiently explaining his solutions to the economic crisis, including the Wall Street bailout that has now been extended to automakers.
Aides described the speech as part of a carefully planned effort to sell the stimulus package to the country, including nationwide travel by Obama and his inner circle.
About 10 percent of the stimulus package will consist of expansion of unemployment insurance and COBRA health insurance for people whose coverage might otherwise be terminated.
The package also consists of infrastructure investments such as roads and bridges; long-term investments in energy, health care and education; and aid to states, such as more generous Medicaid reimbursement rates.
The proportions those measures will take in the final passage have not been specified.
By Mike Allen
? 2009 POLITICO
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The most important thing to remember is to STAY FOCUSED ON ELIMINATING OPEC OIL from our economy. Every dollar spent on infrastructure, renewable energy, and electric hybrid plug-in cars will save MULTIPLE DOLLARS ON FUTURE MILITARY APPROPRIATIONS FOR AMERICAN WARS. Importing 70% of our oil from mostly OPEC countries (minus Canada and Mexico) sets us on autopilot for the next war, terrorist attack, or prostrates our economy to volatile swings in the global oil market. Support the Pickens energy plan, energy conservation, and driving 40 MPG cars. Our kids deserve a better world than the oil status quo.
Posted by hadenough43 at 02:44 PM : Jan 05, 2009
OK, you''''re entitled to your view.
MY view is, it WORKED BEFORE, it''''s WORTH A TRY again.
What do we have left to lose???
I just can''''t help thinking that we wouldn''''t have lost steel, textile, and electronics if we had TARIFFS.
Posted by txgrouch2008
After the French Revolution, there were those who wanted to return to the days of aristocracy. You see, under aristocracy, everybody had a secure place in society, most were miserable, but at least they had a secure place. The problem with these folks was that there view of the old aristocracy was more idealized that it was realistic. Thus, the term (or label) "reactionary" was born. That term has been used every since to label those who wish to return to a time that they imagine and idealize and doesn''t have much relation to actual history.
I know it''s presumptous of me, but you may want to reasearch the term "reactionary".
Posted by oftencensord
---------------
Yep, and now your children and your grandchildren are gonna get to pay for that "personal income tax break" you got, with interest...
By 1913, we had grown from a wilderness colony to an industrial superpower.
We had TARIFFS for our entire history up to that point. TARIFFS were the main source of revenue for our federal government up to that point.
In 1913, the Sixteenth Amendment started the income tax.
After that, we had the biggest boom and bust in history. Twenty years after the income tax started, we were in the depths of the Depression.
THAT is a correlation.
Posted by txgrouch2008
---------------
We also had the great depression roughly thirty years after the birth of the automobile. Does that mean that the birth of the automoblie CAUSED the great depression.
You see, the problem isn''t correlation, the problem is causation.
Also, please believe me when I say that I share your frustration and anger around the income tax.
But returning to the past ain''t the solution. In my view.
Posted by hadenough43 at 02:05 PM : Jan 05, 2009
And AFTER the income tax started in 1913, we had the BIGGEST boom and bust EVER.
Doesn''''''''t that tell you anything???
Posted by txgrouch2008
-----------------
Ok, one more time. We have to guard agains''''t getting correlation mixed up with causation.
In other words, can you establish a link between the establishment of the income tax and the 1929 crash.
The boom and bust cycles prior to that (i.e. before the income tax)would say no.
Posted by hadenough43
-----------------------
Or to put it another way...the boom and bust cycles correlated pretty well with the time of tariffs.
Posted by hadenough43 at 02:05 PM : Jan 05, 2009
And AFTER the income tax started in 1913, we had the BIGGEST boom and bust EVER.
Doesn''''t that tell you anything???
Posted by txgrouch2008
-----------------
Ok, one more time. We have to guard agains''t getting correlation mixed up with causation.
In other words, can you establish a link between the establishment of the income tax and the 1929 crash.
The boom and bust cycles prior to that (i.e. before the income tax)would say no.
Don''''t you GET IT???????
TARIFFS SAVE JOBS. TARIFFS BRING JOBS BACK.
TARIFFS WERE THE PATH TO PROSPERITY.
TARIFFS ARE THE PATH BACK TO PROSPERITY.
Don''''t you GET IT?????
Posted by txgrouch2008
--------------------
We were in lots and lots of depressions before 1929. Boom and bust was the history of this country before the new deal..
Posted by hadenough43
If you want to place a consumption tax on manufactured goods why not just manufacture them here in the first place where a higher standard of living would raise that price? That money would do much more good circulating around the economy rather than going into the pockets of the defense contractors anyway. Of course, that brings us back to Tx Grouch argument for tariffs.
Posted by omega40
-----------------------
Whadda we gonns do - pass a law that says Americans can only purchase stuff made in America?? How far would that get??
One of the nice things about a consumption tax is that it''s in your face, all the time. I have friends and relatives that have no idea what their taxes are, all they ever see is that refund they get. They live for it. It just amazes me. Sad.