Congress in Defiance: Congressional Democrats and Republicans Saying No to the Obama Tax Plan

Two days ago, the Obama Administration presented a bipartisan plan to stop the gridlock on the Bush-era Tax Cuts and created a tax compromise with Congressional Republicans. This compromise; would extend all of the Bush-era Tax Cuts for all income levels for two years, index the alternative minimum tax for inflation, drop the estate tax down from 45 percent to 35 percent on all income above five million dollars, an extension of Unemployment Benefits for all that apply, a payroll tax holiday of 2 percent, an extension of all tax credits, would allow businesses to write off their capital improvements, and also allow business to keep a research and development tax credit. Overall, with this plan, everyone wins, but this does not help the country to become more fiscally responsible, help the people in the greatest need.


The cost of this plan would be 990 billion dollars. That is 171 billion more than the Stimulus spending in back in 2009. Republicans back then and during the 2010 general election argued that the Stimulus spending was a waste of taxpayer money. In article published in August of this year at the Brookings Institute Senior Fellow Gary Burtless argued, "there are many indications that these policies have been successful in achieving
their intended goals." The tax compromise though, does not look like a policy that will help all Americans.

Today in the Huffington Post Jason Linkins reports that wage earners that make between 20,000 and 40,000 dollars will see an increase in their taxes due to the reduction of available tax credits for that income bracket. While the richest people get the greatest benefit. For example, the richest Americans will benefit from the tax cut, the estate tax, and benefit from the payroll tax holiday. Granted the poorer Americans will receive the payroll tax holiday, but their benefit from the tax holiday is smaller than the lost tax credits.

Overall, the Obama Tax Compromise should not be passed. Obama administration made the best compromise possible with Congressional Republicans, but the problem is that the rich get richer while the poor become the pawns for the powerful. Obama promised during the 2008 election that he would not extend the Bush-era Tax Cuts for the wealthiest. This compromise breaks that promise and should not be supported by Congressional Democrats.

It would be for the best for Congress to reject this plan, because what the nation will give up will hurt us in the end. Example this plan increases the deficit by 990 billion dollars over two years. This plan is supported by Republican leadership, which argued that by electing them they would help cut the deficit. This plan does not do that. If Republicans are serious about deficit reduction, they need to vote against the plan.

Compromise is a great item and should have been used more often during the 111th Congress. Unfortunately, though, this is not one of those times. A new plan needs to put on the drawing board that limits the impact on the deficit, but does the greatest Common Civic Good.