Tax Bill Passed By House

House Speaker Nancy Pelosi, flanked by Rep. Barney Frank and other House Members

(USA Today December 17, 2010)  A sweeping plan to extend expiring tax cuts and jobless benefits for millions of Americans went to President Obama's desk for his signature.  Since this particular article, President Obama has signed the tax cuts extension into law.  The House voted for the bill despite opposition from liberal Democrats such as Anthony Weiner (D-NY).  House Democrats attempted to revolt within their own party that threatened to derail the measure.  Many House Democrats joined with Republicans in turning back proposed last-minute changes to the estate tax that would have sent the bill back to the Senate for more work.  The legislation passed 277-148 just before midnight.  Rep. Dave Camp (R-MI) stated, "Congress made the right decision...to prevent a job-killing tax hike on Americans and small businesses."  The proposal, which the Congressional Budget Office says will cost $858 billion over ten years, extends income tax cuts for two years at all income levels, creates a 2% point cut in payroll taxes for one year and continues benefits for the long-term unemployed for 13 months.  Part of the reason why the CBO says the bill will cost $858 billion over ten years is partially because there's a lot of pork spending in this bill.

Though the agreement enjoyed broad bipartisan support in the Senate, a group of liberal House Democrats orchestrated an 11th hour push to change the measure.  Liberals wanted to lower the amount couples could pass on to heirs free from the estate tax from $10 million to $7 million.  Rep. Peter DeFazio (D-OR) said it was a bad bill, who led in opposition to the bill.  The contentious negotiations underscored the hostility many House Democrats felt toward the agreement, which was worked out between Obama and the Republicans.  The bill was originally set for a vote Thursday afternoon, but leaders delayed it when it was evident there wasn't enough support. 

House members began debate on the bill a day after the Senate approved the tax agreement.  The proposal drew support from 44 Democrats and 37 Republicans in the Senate.  Congress was facing a deadline where the tax cuts approved in 2001 and 2003 under the Bush administration were set to expire on December 31 unless Congress voted to extend them.  According to the non-partisan Tax Foundation, a family with an income of $63,366 would have seen its federal income tax rise $1,540. 

One of the bad things about this bill is all the pork that's been added to this bill.  This bill will add more to the deficit than the 2009 stimulus bill passed in 2009.  Congress decided to load up on all the pork they could to stuff this particular bill, which is something Republicans claim they are opposed to.  I also believe the Republicans should've pushed to make the tax cuts permanent as well.  This is something that the new Congress needs to tackle when it convenes in January.  Senate Minority Leader Mitch McConnell (R-KY) told Brett Baier on Fox New's Special Report that Congress won't have to worry about extending the tax cuts for two years.  That is very disappointing because Republicans need to make it an issue to make them permanent.  How many new jobs are businesses going to create since the tax cuts are extended for only two years?  I've heard some some conversative talk show hosts such as Mark Levin say the Republicans should've held off in voting for tax cuts extension in the lame-duck session and wait until the new Congress convenes to vote to make the tax cuts permanent.  That would've been a better deal.  Congress should've made an agreement to keep the tax cuts in place until the new Congress convenes in January.  Then the Republican-controlled House could work out a different deal as opposed to the deal that was made this past Thursday.  That's my opinion.

The two-year extension will play well into the hands of the Democrats in 2012 because that's a presidential election year.  I heard Bob Beckel on Sean Hannity's radio program state last week this would be a good issue for the Democrats to campaign on.  That's probably why they were willing to go along and extend the Bush tax cuts.  The Democrats will try to use this to their advantage when they're up for re-election in 2012.  It's all about the issue.  I doubt the Democrats would've likely been as willing to vote for this tax cut bill if they didn't foresee they could possibly benefit from this issue when federal elections take place in two years.