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Senate Republicans shoot down bill raising taxes on millionaires

Text by News Wires

Latest update : 2010-12-04

Senate Republicans shot down legislation Saturday that would allow upper-income tax breaks to expire at the end of 2010, arguing that not even millionaires' taxes should rise at a time when US economic recovery is fragile.

AP - Senate Republicans blocked legislation Saturday to let upper-income tax cuts expire on Jan. 1, a showdown scripted by Democrats eager to showcase Republican lawmakers as defenders of millionaires and gain an edge for the 2012 elections.

Republicans dismissed the Democrats’ maneuvers as the last gasp of a party that lost its majority in the House of Representatives in the November elections, surrendered several seats in the Senate and will be forced to share power beginning in January.

The Senate debate took place a day after the Labor Department reported that the unemployment rate had nudged closer to double digits again - 9.8 percent, after three straight months at 9.6 percent - a reminder that the economy is still recovering only fitfully.

Republicans argued that no one’s taxes should be raised at a time the economy is still recovering from the deepest recession since the Great Depression of the 1930s.

“It is the most astounding theory I have ever seen, raise taxes to create jobs,” Sen. John Thune of South Dakota said.

Democrats countered by saying that extending the tax breaks for upper-income Americans would only make it more difficult to reduce the growing federal budget deficit.

“Do we want to extend those tax breaks for millionaires and billionaires at a time of huge deficits? I would argue vociferously we shouldn't,” Sen. Chuck Schumer of New York said.

Ironically, the votes were widely seen as a prelude to a possible agreement next week between the White House and congressional leaders on legislation that would avert tax increases at all income levels, as Republicans want.

Any agreement is also expected to extend jobless benefits for the long-term unemployed, a Democratic priority, and possibly renew tax breaks the White House wants for college students, companies that hire the unemployed and lower- and middle-class wage earners.

The Senate took the two votes on Democratic-proposed bills that would have permitted tax cuts to remain in effect at most incomes.

A proposal to let tax rates rise on Jan. 1 on incomes over $200,000 for individuals and $250,000 for couples fell on a vote of 53-36, seven short of the 60 votes needed under Senate rules to overcome Republican delaying maneuvers and advance.

An alternative put forth by Schumer and others - but opposed by the White House - would have let rates rise on incomes over $1 million. The vote was 53-37, also seven short of the 60 needed.

Schumer supplied the political context. “I’m going to be here for the next year, next two years, to remind my colleagues that they were willing to increase the deficit $300 billion to give tax breaks to people who have income over a million dollars,” he said in a reference to the 2012 elections.

If Republicans were worried about the political impact of the day’s events, they did not show it. Several noted that President Barack Obama had urged congressional leaders of both parties in a recent meeting to work together to prevent taxes from going up for the middle class.

In the weekly White House radio and Internet address, Vice President Joe Biden, skipped lightly over Obama’s willingness to negotiate with the Republicans on the Bush-era tax breaks.

“We’ve got to extend the tax cuts for the middle class that are set to expire at the end of the month,” he said. “If we don’t, millions of middle-class families will see a big bite out of their paychecks starting January 1. And that’s the last thing we should let happen.”

“And the second thing we’ve got to do is extend unemployment insurance for Americans who have lost their jobs in a tough economy,” Biden said.

Delivering the Republican address, Sen. Mark Kirk of Illinois, who was sworn into office to fill Obama’s former Senate seat this week, said voters in the November elections demonstrated their distaste for any tax increases.

“The current leaders of Congress should not move forward with plans that were just rejected by the American people,” he said. “These leaders should not raise taxes and risk another recession. Instead, Congress should reduce spending and prevent another tax hike on American taxpayers.”


 

Date created : 2010-12-04

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