A massive tax package that would save millions of Americans thousands of dollars in higher taxes is headed for a vote in the House Thursday even as rebellious Democrats complain it is too generous to the wealthy.
House Democratic leaders plan to pass the bill Thursday. But first, they will hold a vote on imposing a higher estate tax than the one negotiated by President Barack Obama.
The Senate overwhelmingly passed the package Wednesday, with broad bipartisan support. Now, Obama is urging the House to pass it without changes, so he can sign it into law.
“I know that not every member of Congress likes every piece of this bill, and it includes some provisions that I oppose,” Obama said. “But as a whole, this package will grow our economy, create jobs, and help middle class families across the country.
“As this bill moves to the House of Representatives, I hope that members from both parties can come together in a spirit of common purpose to protect American families and our economy as a whole by passing this essential economic package,” Obama said.
The stakes are high as the House begins debate. If the House passes the higher estate tax, the bill would go back to the Senate, jeopardizing the entire package and representing a public rebuke of Obama by members of his own party.
A vote is expected Thursday afternoon.
Many House Democrats, even critics of the bill, are resigned to it ultimately passing with the lower estate tax, especially after the Senate passed it, 81-19.
“The overwhelming vote in the Senate should bring everyone to religion,” said Rep. Bill Pascrell Jr., D-N.J. But, he added, “Let’s have a tangible signal that we really feel that this is unreasonable, what we’re doing in terms of the estate tax.”
Tax cuts affecting Americans at every income level are scheduled to expire Jan. 1 — a little more than two weeks away. The package would extend them for two years.
The tax cuts includes a more generous child tax credit, tax breaks for college students, lower taxes on capital gains and dividends and a series of business tax breaks designed to encourage investment. The package would also renew a program of jobless benefits for the long-term unemployed and enact a one-year cut in Social Security taxes.
A worker making $50,000 in wages would save $1,000 under the cut in Social Security taxes. A worker making $100,000 would save $2,000.
The bill’s cost, $858 billion, would be added to the deficit.
“The president has been clear from the beginning that there are provisions in this bill he does not support,” Treasury Secretary Timothy Geithner said. “But they were necessary compromises in order to secure the president’s top priorities — initiatives targeted to strengthen growth, create jobs and help working and middle-class families.
At the insistence of Republicans, the plan includes an estate tax that would allow the first $10 million of a couple’s estate to pass to heirs without taxation. The balance would be subject to a 35 percent tax rate.
Many House Democrats want to impose a higher estate tax, bringing back the levels in place in 2009. They persuaded House Speaker Nancy Pelosi, D-Calif., to allow a vote on the change, arguing that the higher estate tax would affect only 6,600 of the wealthiest estates, and would save $23 billion.
“It doesn’t create jobs, it adds to the deficit,” Rep. Chris Van Hollen, D-Md., said of the more generous estate tax. “Is that the message this Congress wants to send at a time of high deficits?”
In 2009, individuals could pass $3.5 million to their heirs, tax-free. Couples could pass $7 million, with a little tax planning, and the balance was taxed at a top rate of 45 percent.
The estate tax was allowed to expire for 2010. But under current law, it would come back in 2011 at even higher levels, with a top tax rate of 55 percent. Democrats said their plan to reinstate the 2009 tax is still more generous than current law; many Republicans said the estate tax should be done away with altogether.
“I don’t like this bill, but I like even less the notion of raising taxes on average Americans,” said Rep. David Dreier, R-Calif.
Rep. Mike Pence, R-Ill., said Thursday that he won’t vote for the bill because it doesn’t make the tax cuts permanent.
“A two-year extension of the tax code is not going to encourage the kind of investment that’s going to begin to create jobs in this economy,” Pence said on NBC’s “Today.”
Senate GOP Leader Mitch McConnell said any changes to the bill would derail the entire package, putting millions of Americans at risk of a significant tax increase next year.
“Now it’s up to our colleagues in the House, and we urge Democrat leaders to resist playing political games and making partisan changes so that American taxpayers won’t be hit with a huge, job-killing tax hike on Jan. 1,” McConnell said.
Copyright © 2010 The Associated Press
17 thoughts on “Tax showdown in House today”
Here’s what they were fighting for: Goldman Sachs pay out $111 million in bonuses. So glad they got to keep their tax cuts. Now aren’t you glad your kids will be paying for their bonuses?
Thanks Woody for the link. Ahhh the faces of Blankfein and Cohn, two financial predators extraordinaire. They should both be on a Federal “Wanted” posters for crimes against not only the people of this nation, but the world at large. Goldman Sachs is responsible for just about every market bubble especially when it comes to pushing commodities into the stratosphere as they lay on evermore positions in the futures markets with easy money courtesy of the unholy Fed~Treasury axis of evil.
People best get ready for rising prices along with package shrink in the months to come. Gasoline is headed upward and they predict oil will be back to $100 bbl in the first quarter of 2011, only there won’t be any pullbacks this time as in late 2008 when the last round of bubbles burst.
We’re all being had bigtime with the blessings or our Congressional crimpol contingent. Hey, they’re all millionaires too. They surely don’t want to pay the freight for these gross budget nightmares that they continually rubber stamp, always with an apologia as to why so. Spend, spend and spend some more is their mantra. / : |
I surely hope Moody’s drops the credit rating of the U.S. It’s time for a kick in the n*ts wakeup call. Then again maybe they’ll never come about sending the U.S. rating into the “junk” zone.
Carl Nemo **==
Carl, I had nightmares all night long. It is difficult when there is nobody to blame for our predicament. It brought on this mess of debt with nobody being responsible. The voters demanded that the government out source our many jobs and nobody questioned the action. We had Friedman and Perot but nobody bothered to check their facts. We rant back and forth here on CHB but show zero efforts to stop the wasted programs.
Every two years, my emails and paper letters arrive with grandiose plans for a new and better political action efforts. For years, I sent money to help them get started and never had a return reply. My dream of a limited efficient Party falls into the trash can. I get the impression that one more federal program would sink the ship.
How will this destruction take away our incentives and income? Will we receive a bill for us to pay for the destructive and illegal war in Iraq?
How many more threats to women have to be threatened with before the GOP stop threatening the woman’s right to vote? How many more elections will we have to be threatened with before our gay family members are set free?
I wonder if people as disgusted as I am will sell out and leave America? It is a shame that these religious prohibitions were not added to the Bill of Rights from the start and many of our ancestors would have chosen another world?
Hi net worth individuals are leaving this country in droves Ms. Price. Generally the nations that will give them residency and citizenship expect them to bring serious assets into the country. Canada and the Nordic countries and parts of Europe have many wealthy, expat Americans. I can’t blame them either.
Who wants to live in a nation that’s on the verge of going broke, constantly waging engineered wars for profit, a nation that seemingly doesn’t give a flying flip about its citizenry and that’s ruled by evil, elitist men and women collectively driven by self interest, their mantra, “I’ve got mine, screw you” attitude …!
Good for them. They’ve made a wise choice and should never look back as failed ‘Babylon” burns.
Carl Nemo **==
I had a bad night in terms of dreams; ie, “nightmares” Somehow I feel I was given a glimpse of the future and it isn’t good for us.
The people running this nation at the highest levels are engaged in scuttling the USS America. Make no mistake our now “unitary executive” will turn on us in a NY minute and do us all with the stroke of a pen in terms of seizing assets held in institutions, appropriating 401K accounts, Roth IRA’s etc. along with a declaration of martial law turning the U.S. into an in our face garrison state. Soon they will need money that can’t be had in the debt auction market and they’ll even steal it outright from our citizens. Our Congress has become incurable spendthrifts that have no interest in doing what’s necessary to save us from financial oblivion. It’s an addiction no different than alcoholism except on a grand and even more deadly scale.
We’re flat dead broke as a nation depending on borrowed money just to survive by the day. Our leaders refuse to do what’s necessary in order to show good faith in paying back our debts in the form of higher interest paid to lenders including our citizens who would invest heartily in U.S. debt as long as they were being compensated decently. The long bond market yields are ratcheting upward regardless of Bernanke’s QE2 nonsense which has the intent to inflate our currency out of debt relative to lenders. Lenders are finally catching on though and running for the exits. In fact QE2 is what’s causing deep pockets investors to shy away from Treasuries and Moody’s said if this tax bill passes they plan on downgrading the U.S. credit rating to AAa rather than its time honored AAA status. This is serious folks. The spread on Treasuries from the short to long end of the curve is now approaching an all time record. I ultimately smell national insolvency on the wind.
The following is a link to a “Money and Markets” article by Mike Larson concerning this omnibus shakedown they are voting on today and no doubt will pass at the hands of ‘elected’ traitors in high places.
https://www.moneyandmarkets.com/moodys-warns-washington-%e2%80%94-again-41949?FIELD9=8
I’ve come to the conclusion that those who have the least in terms of assets in these end times for the Republic are better off than those who’ve managed their financial affairs sharply throughout their lives. There’s soon to be a great leveling where the middle class is crushed under their creeping tyranny across all fronts.
Our corrupt, irresponsible leadership has sown the wind and we are all soon to reap the mighty whirlwind of destruction. : |
Carl Nemo **==
All this while the Senate nears passing a one-trillion dollar omnibus spending bill to fund more war, Obamacare, and sneak in the “food safety” bill, among others.
I heard that spending bill came up to $1.2 trillion, so combined with the tax bill, that means $2 trillion more debt?
Doesn’t that put us at $15 trillion now total, or more than 100% of yearly GDP?
One of the first items on this next Congress’ agenda is another increase in the national debt.
I’ve mentioned that I analyze photo’s supplied with articles. This photo of Nancy Pelosi is truly frightful. It leaves my spirit hushed to think that this seemingly crazed, craven being with a synthetic persona is a high level representative on behalf of American citizens’ interests…NOT! Scary is all I can say, truly something out of a horror movie. I’d say we’re in a heap o’ trouble…no? / : |
Carl Nemo **==
Holy crap! Hahaha. Speaker Cruella. Damn!
Perhaps you should be analyzing the motives of the person who is choosing the particular photo. Analyzing what a person is by analyzing external appearance is a fruitless endeavor, particularly where there appears to be obvious bias in choosing photos.
That’s a good point of course, but one can have a little fun, can’t one? As the saying goes, a picture speaks a thousand words.
You could also say that about the myriad messianic images of Obama that the left-leaning press uses all the time.
Gotta luv ya GHL for your ever-balancing commentary. In fact I finally figured out you are an asset to our site in that you provide lotsa heavy “thought ballast” to keep the good ship CHB in trim and pointing into the wind properly.
I think Doug chooses the photo’s for the various articles. Seemingly he does a brilliant job in terms of his bias for showing the ‘pigs butt’ side of a phony crimpol’s countenance.
Carl Nemo **==
Well, shoot! I thought GHL was an asset to our site because he is better informed and smarter than the rest of us.
As ballast, I hope he isn’t jettisoned when CHB takes on some real cargo.
Cap’n of the CuttySnark,
Which politician did you mean in referring to “seemingly crazed, craven being with a synthetic persona”? That would seemingly apply to a majority in the House and Senate.
Lest we be too judgmental, it is precisely this class that provides fodder for our pointless gnoshing herein. (I have to post in secret from my wife, for she thinks this entertainment is buffoonery. Pointing out that I was a buffoon when she married me scores no points).
Yeah, I’m not the shiniest ornament on the tree… but jeezus! No matter why or how the photo was chosen, how could it have gotten snapped in the first place?
Clearly, Nancy has been under SUPREME duress.
Again, Initiative becomes larger than life.
Earmark that !.
Oh Ruby, we could use some company now. Where’s the free lunch?
Our colleagues ?
Murdoch and company let it slip,
it’s not hip, if you can’t do the McConnell flip along with the Pelosi lip.
E4GNASSA,
..
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