Monday, December 3, 2012

Republicans Revert To Pre-Election Tax Plan: Promise To Raise Revenue By Magic

After spending weeks insisting that they don’t need to release additional details for a proposal to avert the so-called fiscal cliff, House Republicans publicized a counter offer to President Obama’s plan on Monday. The plan is similar to the vague outline Mitt Romney proposed during the election and offers few specifics as to how Republicans aim to raise the revenue they’ve promised.

The $2.2 trillion blueprint extends Bush tax cuts for all Americans, including the wealthiest two percent, but finds $800 billion in revenue from “tax reform” by limiting or closing unspecified tax loopholes, deductions, and lowering tax rates. Significantly, the higher revenues will be identified by the relevant House committees next year, and will not be included in the immediate down payment. The plan also enacts an array of mandatory and discretionary spending cuts:

– $600 billion in health savings, including raising the Medicare eligibility age from 65 to 67.

– $300 billion from savings in other mandatory programs.

– $200 billion by applying a less generous measure of inflation to Social Security and Medicare benefits.

– $300 billion in cuts to agency budgets.


In a letter to President Obama, House Speaker John Boehner (R-OH) reiterated the GOP’s support for Rep. Paul Ryan’s (R-WI) reforms to Medicare and Medicaid, which would shift health care costs to seniors and lower-income Americans. The letter does not, mention raising the debt ceiling — for which Boehner has pledged to extract a concession — extending the payroll tax cut or unemployment benefits.

UPDATE:

The White House rejects the plan:

“The Republican letter released today does not meet the test of balance. In fact, it actually promises to lower rates for the wealthy and sticks the middle class with the bill. Their plan includes nothing new and provides no details on which deductions they would eliminate, which loopholes they will close or which Medicare savings they would achieve. Independent analysts who have looked at plans like this one have concluded that middle class taxes will have to go up to pay for lower rates for millionaires and billionaires. “

UPDATE:

Boehner’s plan would also allow the payroll tax to expire.

UPDATE:

House Minority Leader Nancy Pelosi (D-CA) has announced that Democrats will file “a discharge petition, to force a vote on extending the middle income tax cut, on Tuesday at noon.”

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