Geithner: No Deal Without Tax Rate Increases
Treasury Secretary Timothy Geithner did a Full Ginsburg this morning, and on each occasion made the Administration’s position on a deal to avoid the Fiscal Cliff exceedingly clear:
Washington (CNN) - Treasury Secretary Timothy Geithner drew a line in the sand over taxes in defense of the Obama administration’s controversial proposal to avoid the fiscal cliff.
In an interview with CNN’s Candy Crowley on “State of the Union,”Geithner insisted that any compromise on the plan he presented to congressional Republicans on Thursday, which includes $1.6 trillion dollars in tax revenue, cuts to Medicare, and another $50 billion in stimulus spending, must contain an expiration of the Bush tax cuts for income over $250,000.
There’s not going to be an agreement without rates going up,” Geithner said in the interview, which aired Sunday. “If they are going to force higher rates on virtually all Americans because they’re unwilling to let tax rates go up on 2 percent of Americans, then, I mean that’s the choice they’re going to have to make.
While he maintains the administration will refuse any deal without the tax hikes, Geithner was optimistic about the negotiations, showing room for compromise as well.
“It’s a very good plan and we think it’s a good basis for these conversations,” he said. “What we did is put forward a very comprehensive, very carefully designed mix of savings and tax rates to help us put us back on a path to stabilizing our debt, fixing our debt and living within our means.”
In his interview with Fox’s Chris Wallace, Geithner stopped short of saying that any tax rate increases had to exactly match the Administration’s position, which leaves open the possibility of compromise on either the income level at which the new rates would kick in, what the new rate would be, or possibly both. In order for that to happen, though, the GOP is going to have to move on the tax issue at least enough to get to a majority in the House of Representatives. Barring that, and assuming that the Administration isn’t bluffing, we may be headed over the Fiscal Cliff after all.
So Geithner wants a tax change >0.
You believe that is an ultimatum? Wouldn’t 0.0001 satisfy that?
Ah but, if the other side says 0.0001 is too large … they are being reasonable?
No, I am not drinking the Kool Aid or anything else that I see going on in Congress and the White House. We need tax reform that has everyone over 18 in the system (unless they are in the hospital long term). Now we have almost 50% of the American people who pay no income tax. If we could get that tax base closer to 100% (I realize 100% would be perfection and we’ll never get that) then revenues would soar. If the current trends continue, 20% will be paying all of the taxes before too much longer. And I don’t know about you, but I feel that the government is confiscating too much of my money! We must also understand and be aware that anytime the Federal government (and most states for that matter) get more money, they think of more ways to spend it. As far as entitlements go, the first entitlements to be reduced or eliminated are those that Congress gets. Another solution is to send Obama on a 4 year farewell tour overseas (I will contribute to that) and send Congress on a 4 year “Goodwill” junket overseas. When they get back, the fiscal cliff will be gone, there will be a surplus, the schools will be better, gas prices will be down, 2 % unemployment, and no troops overseas in unfriendly countries !!
Here’s an easy way to do that: Cheap government housing and public transportation.
Notice what I did there? I shifted government aid from financial to non-financial, which allowed taxes to be collected from everyone, even as they got housing and transportation on the sly.
Note that conservatives and liberals both have wanted to “cashify” benefits. Rather than an apartment in the projects, the poor got a rent supplement. Etc. That may be fine, but it leads to the situation you describe.
See also the history of “conservatism” and the “negative income tax.”
I was looking at some conservative blogs and the sentiment expressed most often is LIB – Let it Burn. They want to go off the cliff and have another recession. I’m sure the Republican members of congress are hearing it too.
I wonder if Boehner can wrangle enough votes?
I can’t get over the fact that there are people out there with such a sad, childlike understanding of taxes and income disparity in our country, but yet they are somehow smart enough to figure out how to turn on a computer, log onto websites, and post internet comments.
Republicans want tax revenues to increase by way of eliminating tax loopholes that benefit the middle class – such as the mortgage tax interest deduction. Of course they want Obama to buy into this, because the GOP will use Obama’s support of this to hammer Obama and the Democratic Party in the 2014 mid-terms.
Obama should protect the middle class and keep to his middle ground position, which is to increase the marginal tax rates on incomes over $250,000 (he could probably close a deal by making the level $400,000-$500,00.
Obama has the compromise solution, he should hold fast.
Totally agree with your statement. I stopped responding to the “50% does not pay any taxes” arguement a while ago becuase it is impossible to enlighten a person that is ignorant of the nuances of taxing and income taxing on a comment section of a blog! Now, I just giggle a bit and move on to the next read.
it’s early kids, it’s gonna get really weird the week before Christmas. I think most of us are getting coal in our stockings too….again.