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Boehner, GOP: Obama Jobs Plan a Tax Increase

By    |   Monday, 12 September 2011 03:21 PM EDT

WASHINGTON  — In a sharp challenge to the GOP, President Barack Obama proposed paying for his costly new jobs plan Monday with tax hikes that Republicans have already rejected, and he accused them of political motives if they still refuse to go along.

"The only thing that's stopping it is politics," Obama declared.

But Republicans say the White House objective is to put lawmakers in a tight spot: Support Obama's jobs package or risk bein seen as doing nothing for the economy, as the two parties are heading into presidential and congressional elections in November 2012.

The president's proposal drew criticism from House Speaker John Boehner, who'd previously responded in cautious but somewhat receptive tones to the $447 billion jobs plan made up of tax cuts and new spending that Obama first proposed in an address to Congress last Thursday.

"It would be fair to say this tax increase on job creators is the kind of proposal both parties have opposed in the past. We remain eager to work together on ways to support job growth, but this proposal doesn't appear to have been offered in that bipartisan spirit," Boehner spokesman Brendan Buck said.

``I hope the president is not suggesting that we pay for his proposals with a massive tax increase,'' said Eric Cantor, the No. 2 Republican in the House of Representatives.

The biggest piece of the payment plan would raise about $400 billion by eliminating certain deductions, including on charitable contributions, that can be claimed by wealthy taxpayers. Obama has proposed that in the past — to help pay for his health care overhaul, for example — and it's been shot down by Republican lawmakers along with some Democrats.

White House budget director Jack Lew outlined Obama's proposals which  largely targets the rich and corporations -- something Obama has tried to do in the past to little avail.

The biggest item would raise $400 billion by limiting deductions and exemptions on individuals who earn more than $200,000 per year and families who earn more than $250,000.

He also proposed raising $18 billion by treating the earnings of investment fund managers as ordinary income rather than taxing it at lower capital gains rates.

By daring Republicans anew to reject tax hikes on the rich Obama could gain a talking point as the 2012 presidential campaign moves forward, if not a legislative victory.

At a Rose Garden event Monday, Obama brandished his jobs bill in the air and surrounded himself with police officers, firefighters, teachers, construction workers and others he said would be helped by it. Adopting a newly combative tone that's been welcomed by dispirited Democrats, Obama demanded immediate action on the legislation, which the White House sent to Capitol Hill Monday afternoon.

"This is the bill that Congress needs to pass. No games. No politics. No delays," Obama said.

"Instead of just talking about America's job creators, let's actually do something for America's job creators."

Obama told of reading a quotation in a newspaper article from a Republican congressional aide who questioned why Republicans should work with Obama since the result might just be to help the president politically. "That was very explicit," Obama said.

Buck, the Boehner spokesman, said the anonymous quote cited by the president didn't reflect the view of Republican leadership.

And even as Obama was accusing Republicans of playing politics, he and his Democratic allies were marshaling an aggressive political response of their own.

Obama was traveling to Boehner's home state of Ohio Tuesday to promote his jobs plan, and following that with a trip Wednesday to North Carolina, a traditionally Republican state he won in 2008.

He was getting backup from the Democratic National Committee, which announced a television ad campaign starting Monday to promote Obama's jobs plans in key swing and early-voting states and to call on voters to pressure their lawmakers for support. The ads urge viewers to "Read it. Fight for it. ... Pass the President's Jobs Plan."

The back-and-forth was taking on elements of a political campaign, with high stakes for both sides as Obama heads into his re-election fight with the economy stalled, unemployment stuck at 9.1 percent and polls showing deep public unhappiness with his leadership on the economy.

His jobs package would combine tax cuts for workers and employers by reducing the Social Security payroll tax, with spending elements including more money to hire teachers, rebuild schools and pay unemployment benefits. There are also tax credits to encourage businesses to hire veterans and the long-term unemployed.

The payment method the White House announced Monday would consist of:

—$405 billion from limiting the itemized deductions for charitable contributions and other deductions that can be taken by individuals making over $200,000 a year and families making over $250,000;

—$41 billion from closing loopholes for oil and gas companies;

—$18 billion from requiring fund managers to pay higher taxes on certain income;

—$3 billion from changing the tax treatment of corporate jets.

White House Budget Director  Lew said that Obama will also include those tax proposals in a broader debt-cutting package he plans to submit next week to a congressional "supercommittee" charged with finding $1.2 trillion in savings later this year. He said that the supercommittee would have the option of accepting the payment mechanisms for the jobs bill proposed by Obama, or proposing new ones.

Republicans have indicated they're receptive to supporting Obama's proposed payroll tax cut and finding a way to extend unemployment benefits, though many have rejected Obama's planned new spending. Obama's new proposal Monday to pay for it all by raising taxes without any proposals to cut spending is unlikely to win him any new GOP support for any element of his plan.

Cantor said the Republican-controlled House would not support ideas like construction spending and aid to cash-strapped states that were in the 2009 stimulus bill.

Those currently account for about $150 billion, roughly a third, of Obama's current plan.

``Anything that is akin to the stimulus bill I think is not going to be acceptable to the American people,'' Cantor told reporters shortly after Obama's Rose Garden speech. ``The country cannot afford more spending like the stimulus bill.''

Whether Democrats would try to move the president's jobs plan through Congress as a stand-alone bill in coming weeks or whether all or part of it could be coupled with work being done by a the supercommittee  looking at new deficit-reduction steps is still up in the air.

On Sept. 19, Obama is expected to offer  $2 trillion in new government savings -- presumably spending cuts coupled with tax increases -- to help the super committee find at least $1.2 trillion in deficit reductions.

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WASHINGTON In a sharp challenge to the GOP, President Barack Obama proposed paying for his costly new jobs plan Monday with tax hikes that Republicans have already rejected, and he accused them of political motives if they still refuse to go along. The only thing...
Monday, 12 September 2011 03:21 PM
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