President
Obama ran his last campaign on the central premise that, in order to truly
achieve economic stability and fully recover from the Great Recession he
inherited, we must ensure that everyone plays by the same rules and everyone
pays their fair share.
As we
start off the New Year, thanks to the steadfast leadership of President Obama,
this campaign promise has become reality.
Although
Congressional Republicans tried to delay a vote (which would have led to deep
cuts in programs that benefit the middle-class, raised taxes significantly for
98% of families and 97% of small businesses, and provided a serious blow to our
growing economy) around 11pm on New Year’s, the House finally voted to pass the “American Taxpayer Relief Act of 2012”.
In sum, the bill provides
much needed stability and fairness to our tax code, keeps in place important
investments in education, infrastructure, and healthcare, strengthens the
middle-class, and helps to reduce our deficit.
Here are some specifics
(additional information can be found here ) :
= The bill permanently extends all of the Bush
tax cuts for incomes below $450,000, while reinstating the Clinton-era 39.6
percent tax rate for income above this
= The bill permanently
sets taxes on investment income (capital gains and dividends) at 20 percent for
income above $450,000, while keeping the rate at 15 percent for everyone else. This is especially important since, as discussed
previously in the Buffet Rule, the wealthiest have enjoyed significantly lower
tax rates since most of their incomes come from these investments.
= The
bill extends certain middle-class tax credits that came as part of the
President’s 2009 Stimulus Package. These include the America’s Opportunity Tax Credit, the Child
Tax Credit, and the Earned Income Tax Credit
= The bill extends
long-term unemployment benefits (for those 2 million + unemployed for longer
than 26 weeks).
= The bill averted a scheduled, steep drop in
Medicare payments to physicians
Although Congressional Republicans tried to
continue putting millionaires ahead of the middle-class by holding our economy
hostage until the very last minute, we must ensure that this new Congress puts
the American people above politics and partisanship.
This was a long and hard-fought battle and,
luckily, the American people won. Happy New Year!
The President CAVED! He said he would draw a line in the sand at raising taxes for those making $250K. Then he very quickly moved it to $450K because Boehner.
ReplyDeleteThanks for your comment J.L.
ReplyDeleteAlthough we didn't get everything we wanted, the fact that we won the battle on the rates the wealthiest pay (up from 35% to the Clinton era-levels of 39.6%) is a BIG victory, especially because Republicans were very adamant about not raising the rates to this level (we were worried that we might have to settle at a rate of 37% for example).
It was also a big victory for us because this is the first time in 20 years that Republicans voted to raise taxes on the wealthiest.
We also did NOT cut any social programs that benefit the middle-class (which would have been severely cut if we went over the fiscal cliff).
Most importantly, we avoided going over the fiscal cliff.
In the end the middle class tax payer lost this battle. Thanks to Congress (both Democrats & Republicans), as well as the President, all taxpayers will pay more in taxes INCLUDING the middle class taxpayers. They will pay an increase of 2% in payroll taxes; even those making LESS than $450K.
ReplyDeleteThe real issue here in spending, where the Democrats do not want to make any cuts. I understand, not cutting social security or medicare, but certainly cuts need to be made on the Federal side. Time to vote out the bums (from both parties)
Thanks for your comment AP. But I respectfully disagree.
ReplyDeleteIf we went over the fiscal cliff or agreed to no increase in revenue from the wealthiest (like the Republicans were arguing for), then middle class would truly suffer. Their cost of living would have increased significantly, there would have been drastic cuts to unemployment benefits, social security, health insurance, student loans,and tax credits, and their income taxes would have increased significantly.
Furthermore, people tend to forget that the first part of this deal came last year (the Budget Control Act) where the President and the Democrats signed off on over $1 trillion in spending cuts. Now was the time for this increase revenue.
I think the President has proven time and time again (even angering many on his own side) that he is truly willing to compromise. But the fact that the GOP is the only party to have signed a pledge in the past that forbids them from even taking a deal that included "Ten dollars in spending cuts for 1 dollar in revenue" proves their "willingness" to compromise.