President Obama received some good news today after a rough couple of days where he has received a ton of criticism from his base (Democrats); including me (check my posts from last week). Today Senator Harry Reid (D-NV) was able to bring a test vote to the floor of the Senate on Obama’s Tax Deal.
President Obama’s Tax Deal with GOP:
The GOP got around $95 billion in tax cuts for wealthy Americans and $30 billion in estate tax cuts. Democrats got $120 billion in payroll-tax cuts, $40 billion in refundable tax credits (Earned Income Tax Credit, Child Tax Credit and education tax credits), $56 billion in unemployment insurance, and, depending on how you count it, about $180 billion (two-year cost) or $30 billion (10-year cost) in new tax incentives for businesses to invest. – via Ezra Klein (Washington Post)
The deal received the 60 votes (super majority) needed to avoid any possible filibuster. Obama said the following after the vote,
“I recognize that folks on both sides of the political spectrum are unhappy with certain parts of the package. And I understand those concerns. I share some of them,” he said.
However, he said, “Taken as a whole, the bill that the Senate will allow to proceed does some very good things for America’s economy and the American people.” – via Miami Herald
Senators spoke afterwards about reluctantly voting in favor for the Tax Deal as they feel they cannot afford to let the tax cuts expire for the Middle Class as well as not implement the tax credits, payroll-tax cuts, and not extend unemployment benefits. The consensus is that it is better to accept that tax cuts for the rich and have unpaid for unemployment benefits than to risk a double-dip recession.
Now all eyes are on the House of Representatives; once the Senate officially votes in favor of the deal it will be sent to the House for approval. House Democrats have already voted in favor of a resolution stating they will not support the Tax Deal in its current form. At the end of the day this deal will pass but i foresee that there will have to be some kind of tweaks to the deal. I don’t believe there will be any major changes but there will be some, Democrats in the House will have to save face after all the grand standing they have done over the past week.
At the end of the day this deal will PASS…
I will continue to say that I am not happy with this deal but I will have to live with it; almost all economist and business experts say that the tax cuts in combination with the pay-roll tax and tax incentives for the business will spur a necessary economic growth that will continue an upward trend for an economy that has been slowly growing. I can only hope that the President will stand by his word and fight in 2012 to make sure the tax cuts expire for the rich (and possibly the middle class). The President is banking on that he will have a stronger economy and a lower unemployment rate on his side to pressure Republicans into being fiscally responsible.
I hope Obama is right, ultimately he has decided to “kick the can” of ending unpaid for taxes and really attacking our national deficit down the road to 2012. I just hope it will not be too late… what would help is if the President would take a serious look at the findings of the Debt Commission. We need a strong plan going into the next 10 years on how we are going to reduce the deficit; right now China and other nations we are borrowing from cannot be happy with the United States potentially adding another $1 trillion dollars to the deficit. If the U.S. economy fails the World Economy fails…
So President Obama you stated a week or so ago that you would dare Republicans to challenge, well I hope you are up for it because it will not only be Republicans challenging you!!!
If there is something to be said, “It’s On Broadway” to step up and say it!!!