Plan raises rates only for highest earners
by jordan blum
Advocate Washington bureau
July 11, 2012
WASHINGTON — U.S. Sen. Mary Landrieu, D-La., said Tuesday that she will support President Barack Obama’s plan to extend tax cuts for one year for all those except American families making more than $250,000 a year.
A potential swing vote in the Senate, Landrieu on Monday had not clarified specifically whether or not she would prefer an income level above the $250,000 cutoff.
Some Democrats have said they would prefer maintaining the tax cuts for all those making up to $1 million, while Republicans want to extend all of the Bush-era tax cuts.
“My preference is we should move on what we agree on now,” Landrieu said, arguing that the most important thing is to provide security to middle-class Americans.
Landrieu said she could possibly support expanding the threshold above $250,000 at a later time.
But, for now, Congress should move on the president’s proposal, she said.
“Then we can come back later if there’s some additional money we can find … and increase those thresholds,” Landrieu said.
Landrieu said the $250,000 cutoff would protect roughly 98 percent of Louisiana residents and small businesses.
Some Democrats such as House Minority Leader Nancy Pelosi, D-Calif., and Sen. Charles Schumer, D-N.Y., had previously supported cutting off the tax breaks at the $1 million income level.
But they changed their tunes Monday and backed Obama’s $250,000 plan. Some other Democrats though stuck with their support of the $1 million threshold.
While Republicans seized on the president’s proposal as a massive tax increase, Obama argued Monday to let the tax cuts expire for the wealthiest 2 percent of Americans will help cut the federal deficit.
“Many members of the other party believe that prosperity comes from the top down, so that if we spend trillions more on tax cuts for the wealthiest Americans, that that will somehow unleash jobs and economic growth,” Obama said. “I disagree. I think they’re wrong. I believe our prosperity has always come from an economy that’s built on a strong and growing middle class.”
While speaking at an Iowa community college on Tuesday, the president added, “And we can lower our deficit, rather than give more tax breaks to folks who don’t need them and weren’t even asking for them.”
Obama’s proposal is projected to raise $850 billion over 10 years.
Sen. David Vitter, R-La., released a statement on Monday accusing Obama of hurting small businesses.
“This would be the single biggest tax increase in U.S. history — $850 billion — with much of that on the backs of small businesses which pay through the individual rate,” Vitter stated. “Obama said we shouldn’t do that in late 2010 because the economy was so weak — yet growth is weaker now than then. It also seems clear all those in the middle class can count on a tax increase if Obama is reelected with his limited one-year reprieve.”
Landrieu’s email response on Monday had read, “With the economy still recovering, this is not the time to raise taxes on middle class families. I support efforts to extend the current tax rates for the 98 percent of Louisianians who earn less than $250,000 per year.
“At the same time, extending tax cuts for the middle class will also protect 97 percent of America’s small business owners who earn less than $250,000 per year. If we can afford to do more, given the fiscal pressures on our budget, we will make every effort.”