A few Senate Democrats — including Sens. Ben Nelson (D-NE), Kent Conrad (D-ND) and Evan Bayh (D-IN) — have come out against President Obama’s plan to extend the Bush tax cuts for the middle-class while allowing them to expire for the richest two percent of Americans (saving $830 billion in borrowing and spending). In fact, Nelson feels so strongly about extending the Bush tax cuts that he delivered a speech today at the Heritage Foundation, a right-wing think-tank, arguing for “why we should not raise taxes in a weak economy.”
“I hate deficit spending, but some matters are so urgent that they can’t wait. Such was the case with the stimulus package, which contained more than $300 billion in tax relief, and I believe the same holds true about the expiring Bush era tax cuts,” Nelson has said. Heritage promoted the event by noting Nelson’s support for Bush’s tax cuts in the first place:
Since coming to the Senate in 2001, Nelson has played a key role in passing several major tax cuts, including providing the lynchpin of Democratic support for both the 2001 and 2003 tax cuts enacted under President George W. Bush. In September, Nelson announced that he would again break ranks with his party and support the continuation of the 2001/2003 rates, noting that raising taxes in this economy could impair recovery and “hold back economic development across America.”
To his credit, Nelson did tout the American Recovery and Reinvestment Act as a success during the speech. But if Nelson’s worried about holding back development, he might want to take a look at the Congressional Budget Office’s work on the effects of the Bush tax cuts.
CBO has found that extending the Bush tax cuts are the least effective tax or spending step available for boosting the economy and that extending the entire Bush tax cut package permanently will actually decrease incomes and gross national product, due to the increased borrowing needed to pay for them. As The Wonk Room explained, Nelson has also suggested financing an extension of tax cuts for the rich by raising taxes on the middle class.
Nelson’s message went over well at Heritage, where fealty to Bush tax policies is paramount. But if Nelson truly believes in his policy prescription, then he should be willing to face a more skeptical audience. With that in mind, we’d like to extend an invitation to Nelson to come to the Center for American Progress and debate the Bush tax cuts anytime he’d like.