When President Obama announced a compromise deal had been reached on the tax plan with Republicans, he said it was like a hostage taking situation with the Republicans taking the American people as the hostages. Obama said he did not want to risk hurting the American people. Ironically, parts of his tax agreement, if approved, would hurt the American people. He added it was a “not perfect” plan. That statement is an understatement. And if the Republicans held the unemployed and middle class Americans as hostages, then President Obama may now be under siege by his own party, particularly by Congress.
At a meeting on Capitol Hill on Wednesday, December 8, Rep. James Clyburn (D.SC) expressed grave concerns about the tax agreement reached by the White House. As the third highest ranking Democratic member of Congress, Rep. Clyburn openly expressed his displeasure with key parts of the deal, before a small group of prominent African American bloggers and journalists. The most distasteful part of the proposal is the estate tax provision. Americans need to know that President Obama’s proposed deal goes even farther than the former Bush inheritance tax laws. Under the Bush inheritance tax, the first $3.5 million inherited by a single taxpayer and $5 million inherited by a married couple was exempt from any taxes, with any remaining amount taxed at 45%. Under the Obama deal, the first $5 million inherited by a single taxpayer and now $10 million by a couple would be tax exempt and any amount over that would be only taxed at 35%. That change in the estate tax law, if approved and enacted into law, would add upwards of $60-70 billion by some estimates and up to $100 billion by others. It affects only 3500 families in the entire country, according to Rep. Clyburn. It’s ironic that President Obama, in stating he does not want to have the American people taken hostage and hurt, would rather risk draining our economy even further by helping the rich. Doesn’t the drain on the economy and deficit further hurt the American people?
The other component of the tax deal that is troubling to some Democratic lawmakers is the extension of the unemployment benefits to one year versus the extension of the Bush era tax cuts for everyone, including the 2% wealthy for 2 years. Rep. Clyburn spoke about supporting a 1 year extension for both. The least of those among us need the most help. So why wouldn’t we extend the tax credits for the same period as the unemployment extension? Compromise is necessary in politics. Compromise that is mutually beneficial to all is what is needed. It’s troubling that we will further drain the economy to help the rich with tax cuts, yet the Republicans will cry socialism if we do anything to help the least among us.
It remains to be seen if the proposed deal, in its entire form, will pass Congress and Senate. The notion of a filibuster has already been mentioned. It’s definitely a bitter pill to swallow for many Democratic lawmakers. Many Democratic lawmakers may now hold the President’s plan hostage unless key provisions are changed.
Washington, DC based Debbie Hines, Esq. is a legal and political commentator. She also contributes to the Huffington Post. She holds a Juris Doctorate from George Washington University Law School and a BA from the University of Pennsylvania.