November 15, 2010
By J.D. Foster, Ph.D.
The biggest issue in the coming lame-duck session (and perhaps the next Congress) is what to do with the 2001 and 2003 tax relief expiring at the end of next month.
Most of the lines in this political battle are clearly drawn. Conservatives and most Republicans oppose raising taxes. They insist that all the tax relief at least be extended, and preferably made permanent. President Obama calls this “hugely expensive,” preferring instead to raise taxes on small businesses, seniors, investors and savers, but otherwise to protect the middle class from even larger tax hikes.
The current congressional Democratic leadership has been more opaque in their comments, but their actions demonstrate their preferences. Having dawdled throughout 2009 and 2010 with no action taken, they obviously prefer to raise taxes on everyone to fund their spending surge. This was made plain enough last June when Democratic Majority Leader Steny Hoyer said that even making the middle-class tax relief permanent was “too expensive.” If it’s not permanent, then it’s temporary. If it’s temporary, then Hoyer intends to let them expire.
Obama’s argument that extending all of the tax relief would cost too much is too disingenuous to let stand. Of the $3.6 trillion, 10-year tax hike at issue (Obama’s figures), the president proposes to prevent tax hikes representing 83 percent of the total, while saying that the other 17 percent is too expensive to forgo. If one or the other were too expensive, it would be the 83 percent in middle-class tax relief provisions, not the 17 percent representing the balance.
Obama’s argument about expense is phony. His real goal is to satisfy his political need to raise taxes on “the wealthy” because, in his view, they deserve it. Or more accurately, Washington deserves the money more than those who earn it do.
J.D. Foster is the Norman B. Ture Senior Fellow in the Economics of Fiscal Policy at The Heritage Foundation.
First appeared in The Daily Caller
J.D. Foster, Ph.D.
Norman B. Ture Senior Fellow in the Economics of Fiscal Policy
Read More >>
Heritage's daily Morning Bell e-mail keeps you updated on the ongoing policy battles in Washington and around the country.
The subscription is free and delivers you the latest conservative policy perspectives on the news each weekday--straight from Heritage experts.
The Morning Bell is your daily wake-up call offering a fresh, conservative analysis of the news.
More than 450,000 Americans rely on Heritage's Morning Bell to stay up to date on the policy battles that affect them.
Rush Limbaugh says "The Heritage Foundation's Morning Bell is just terrific!"
Rep. Peter Roskam (R-IL) says it's "a great way to start the day for any conservative who wants to get America back on track."
Sign up to start your free subscription today!
The Heritage Foundation is the nation’s most broadly supported public policy research institute, with hundreds of thousands of individual, foundation and corporate donors. Heritage, founded in February 1973, has a staff of 275 and an annual expense budget of $82.4 million.
Our mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense. Read More
© 2014, The Heritage Foundation Conservative policy research since 1973