Last night, President Obama unveiled his new jobs agenda, which includes an extension of the payroll tax holiday for workers and employers, as well as a temporary payroll tax reduction as an incentive for businesses to hire more people. As the nonpartisan Congressional Budget Office and other experts have found, payroll tax cuts are far more stimulative than many of the other tax cut proposals currently on the table.
Many Republicans are already voicing their opposition to the proposal. Rep. Tom Price (R-GA), chair of the House Republican Policy Committee, spoke with NPR last night and revealed that his party’s opposition to the tax cut is rooted in class. The payroll tax cut, Price explained, is a “good nugget from a rhetorical standpoint, for the class warfare that [Obama] seems intent on fighting”:
SIEGEL: Well, let’s pick apart some of what he asked for today. Continuing the payroll tax holiday, both for employers and employees, Republicans on board with that possibly?
PRICE: Well, it’s a tax reduction in his eyes. In fact, it’s just a shift of the money to pay for Social Security. So, from a policy standpoint, it doesn’t make a whole lot of sense. It’s a good nugget from a rhetorical standpoint, for the class warfare that he seems intent on fighting. But, you know, whether or not that survives, I don’t know. It doesn’t make a whole lot of sense from an economic standpoint because the money to pay Social Security recipients has to come from somewhere. If it’s not going to come from the payroll tax, then it’s going to come from the general fund. And so, then you’re just borrowing from Peter to pay Paul.
Obama’s plan to pay for the working class tax cuts is to end wasteful tax loopholes for corporations and wealthy investors. Price, who touts himself as a pro-growth tax cutter, is waging his own class warfare: protecting tax subsidies for billionaires to prevent substantive tax cuts for working families.