As Congress considers extending the Bush tax cuts, Republicans have made it explicitly clear that they are prepared to go to the mat to extend the cuts for the wealthiest Americans. Now, White House officials are floating the possibility of including an extension of the so-called “Obama tax cuts” — middle-class cuts included in the economics stimulus package — as part of any larger tax deal. These cuts, such as The Making Work Pay tax credit, which reduced payroll taxes on 95 percent of working families, will expire in January unless Congress acts.
Asked about this potential deal yesterday by Fox News host Neil Cavuto, Rep. Jim Jordan (R-OH), who sits on the Budget Committee, suggested that congressional Republicans would not be willing to extend these middle-class tax cuts — which he called “much less effective” — even if the Bush cuts for rich are also extended:
CAVUTO: I know that extending it for everyone. But even if it included this provision that the White House, I guess, is now pushing?
JORDAN: Oh, the Making Work Pay and the tax credit? I think those are not near as effective, but I’d be willing to look for that if we keep all the Bush tax cuts in place —
CAVUTO: So that’s what they just did. I think they offered you a negotiating point. And you would be willing to take it?
JORDAN: I have not seen that. Well, I don’t know if I would be willing to take it. I’d be willing to look at it.
Congressional Republicans have already been holding hostage the Bush tax cuts for those making less than $250,000 a year, threatening to let all Americans’ taxes go up if the cuts for wealthiest two percent are not extended as well. Yesterday, “Republicans were furious” that the House passed an extension of just the Bush cuts for the middle class, and Senate Minority Leader Mitch McConnell (R-KY) has threatened to filibuster a similar bill in the Senate.
But Jordan’s comments yesterday bring the GOP’s brinkmanship in defense of the rich to a new level. The Making Work Pay credit boosted paychecks for 110 million families and were “designed exclusively as a middle-class benefit.” These cuts only applied to payroll taxes, meaning people had be employed and earning a living to enjoy them. Yet these too will apparently be taken hostage so the rich can get their share.
And Jordan is wrong in suggesting these cuts were “not near as effective” as the Bush tax cuts for the rich. As the Center for American Progress’ Michael Ettlinger noted, the Bush tax cuts simply “didn’t deliver” on their promise to stimulate the economy. “The economy did not add a single new job during three years under the Bush tax cuts.” However, as Center on Budget and Policy Priorities’ Chuck Marr explained about the Obama tax cuts, “Most people may have no idea they received it and no idea that it’s going away. But what you can be certain of is that they’ll have less money and they’ll spend less — and this is a terrible time for the economy to lose $60 billion of spending.”