WASHINGTON (AP)– His political credibility on the line, President Barack Obama testily defended his willingness to choose compromise over combat with Republicans on Tuesday, lecturing fellow Democrats not to be "sanctimonious" purists. Sensitive to charges of caving on bedrock principles, he said he welcomed fights with the GOP ahead of his 2012 re-election bid.
"I will be happy to see the Republicans test whether or not I'm itching for a fight on a whole range of issues," Obama said. "I suspect they will find I am. And I think the American people will be on my side."
The subject was taxes, who would or wouldn't keep Bush-era reductions come Jan. 1. But for Obama, barely a month after disastrous congressional losses to the Republicans, there was a lot more to it.
What emerged Tuesday was a portrait of a president determined to show he's not a weak, irrelevant capitulator — the kind of image that, if it becomes part of a lasting narrative, could derail his presidency and re-election bid.
In the past few days, Obama has tried to recover from the midterm elections by showing deference to his opponents, angering allies in the process.
The key moment came Monday, when he announced a deal with Republicans that would extend tax cuts to all taxpayers for two years, after long insisting that upper income Americans did not need the help and the nation couldn't afford it. Though he won a number of concessions from Republicans, congressional Democrats were left bristling.
Fore more:
http://news.yahoo.com/s/ap/us_obama
With all the budget talk this last week, the 2 Teachers at CBS 2 School gave us a good post on Budget Basics:You had to know your GSL (Government as a Secondary Language) if you expected to understand the big budget news last week.
President Barack Obama’s bi-partisan national debt commission released its formal report suggesting ways to reduce the nation’s deficits and total debt. But the Commission also released news that its suggestions did not garner enough support to automatically move the proposals forward in the legislative process.
The Commission’s proposal dealt with five key budget basics:
Revenues—the taxes collected by the federal government that pay for government expenses.
Among the Commission’s proposals was a plan to simplify the U.S. tax code but eliminate popular incentives such as tax deductions for mortgage interest. The proposal also caught political flak for suggesting that top income earners should pay even more into the Social Security program.
Entitlement Spending—governmental expenses that are permanent and can only be changed with amendments to laws. Of the $3.5 trillion dollars that the federal government spends, more than $2 trillion is spent on entitlement spending.
Social Security is the government’s single most expensive program, and only getting more expensive with a larger pool of retirees who are living longer than ever. Among the Commission’s more controversial proposals was trying to save money by increasing the age (from 67 to 69) at which someone could receive full Social Security benefits.
Discretionary Spending—well less than ½ of the federal government’s expenses are costs that can be adjusted on an annual basis.
Defense spending takes up the lion’s share of this spending with more than $600 billion spent in this area for the 2010 fiscal year. The Commission recommended that discretionary spending be capped from 2012 through 2020. It also recommended that non-critical spending be cut in order to get spending more in control.
Deficit and Debt—our federal government has spent over a trillion dollars more than it takes in for revenues this year. With the accumulation of deficits during the last 40 years, our government as accrued more than $14 trillion in total debt during that time.
The Commission’s recommendations were meant to deliver a stark message about the importance and difficulty of cutting expenses while increasing revenues. If adopted fully, the Commission’s proposal could have resulted in cutting $4 trillion dollars in deficits by 2020. But with key lawmakers from both parties refusing to endorse the Commission’s deficit-cutting proposals, we’re back to hearing the same old message that GSL has delivered for nearly 50 years: let the next generation deal with it.
7 comments:
In such harsh economic times, I don't think you can force people to pay more of their earned money to government. I agree with the extension of the "Bush-era" tax cuts, because I believe that if you were to increase the taxes that people needed to pay, it would not only affect their wallets, but also big businesses. Leaders of large corporations are usually on the republican sides of things and are usually in the upper class of America. If the government were to force them to pay more of their hard-earned money to the administration, they would probably become more conservative when hiring. Not only would they already be ticked off that they have to pay more, they would probably not hire many people, which would add to the difficulty of finding a job today.
I feel that the bush tax cuts, although they will add to the national debt, will, in return, lower the percentage of unemployment. This will indirectly decrease the national debt, because we will be able to cut the newly signed unemployment benefit package.
I believe the main issue here is that our nation cannot afford to continue these tax cuts any longer. We are already drowning in national debt and extending these tax cuts will only make it worse. The Bush tax cuts were meant to be temporary; we should let them expire as they were supposed to do. It is understandable that our current economic state needs assistance, which is why Obama agreed to compromise. But this tax cut should only be extended to the middle and lower classes because they are suffering the most from the dismal economy. It is not necessary to extend the tax breaks to the wealthy as they have been the least affected by the downfall of the economy. They can afford to pay slightly more in taxes and help our government lessen its debt.
I think that Obama was forced into this position by the republicans. I won't bash him for making a hard choice, but I disagree with the result. Unlike the above poster, I don't think letting the rich keep their tax cuts will help the nation.
Corporate income tax, and personal income tax, are separate entities. Raising the personal income tax on the rich won't, as the above poster stated, force the corporation to give up its profits, UNLESS the executives raise their salaries to offset their own raise in taxes. I would like to hope that the leaders of large companies are not apt to rob their own company in an attempt to beat the tax man.
The thing is, for as much as business does for america, the government does a lot too, as it should. The government, like all people, should use what power it has to help others, especially those who cannot help themselves. This comes in the form of taxes, by which the government spreads out the cost of its programs among all citizens able to pay. This means that taxes are, in essence, actually like giving money to charity. The money given will go to help others, or perhaps even oneself.
The problem is that Americans often like programs and hate being taxed for them. For that reason, raising taxes, or, oppositely for the the right, cutting programs is political suicide. Cutting programs is only popular until its revealed what's being cut, and raising taxes is never popular. This has led to a terrible mismatch of ideology and policy with more spending and less revenue for the government.
Right now, as far in debt as we are, it will take higher taxes AND fewer programs to get the US to stop digging its own hole. While being in a little debt can be useful to government (it allies ones creditor's to one's own interests), too much means that the amount available for defense, programs, and employees drops.
Keeping taxes at an unsustainable low will not help America, and not raising taxes on people who live better than a super-majority of the population, even with high taxes, makes no sense. Especially not when many of the working and middle classes are suffering and the government is getting so broke itself that it can hardly afford to lend assistance anymore.
I normally try to think about things from the other side, but the republican decision to pursue the unpopular continuation of the $250,000+ tax cuts in order to hold the -$250,000 tax cuts and the unemployment benefits hostage, just so they could stop the Democrats from making what would have been a popular choice, is morally wrong. They should have stopped to think of the poor and the unemployed they would have hurt had Obama not chosen to compromise. Fortunately, Obama did think of the people he serves as president. I respect him for that, even if I hate the compromise he had to make.
I agree with Dylan on this one. At this point it is more important to make sure every class has the ability to make ends meet. Also, big businesses and small businesses cannot take a substantial hit right now, such as an increase in taxes. We keep hearing how it is already hard enough for businesses to make it, what would happen if the tax rates increased, and how high would unemployment climb if even more businesses were forced to close?
I honestly think that such tax cuts are not a great idea, at least not for everyone. The cuts should may help the lower class, but we need to think about the United State's budget. Since the country is in debt, it may be a better idea to get rid of some of the cuts, especially for the upper class, and use the money for other programs that are more of a necessity.
I agree that there are problems with the tax bill and that politically it's a risky stance to take. However, if the Obama administration wants to balance the budget, they must at some time either drastically cut spending or raise taxes. As much of the spending by the federal government is mandatory, the cuts to spending will do little to truly balance the budget and so the only way to make up this difference is through raising taxes. Certainly these taxes are unpopular but taxes on at least the wealthiest 5% of Americans should definitely rise in order to allow us pursue a policy of true fiscal responsibility.
However, there are two sides to this issue. While most Republicans insist that balancing the budget is necessary, they fail to consider the ramifications of trying to balance the budget. Cuts in spending will most likely fall on Social Security, education, and environmental protection, all needed programs that many look to cut simply because funds are not required to be allocated.
The Bush tax cuts were a plan that was put into action with mentality that it would help for that specific time frame and then we would be willing to get rid of the crutch. By extending the tax cuts, we are avoiding dealing with various other factors that are feeding into this harsh economic time. A graduated scale and a revised system of taxation in general I believe would benefit this economy greatly.
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