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Tick Tock Tick Tock: The Clock Is Ticking On the Payroll Tax

Tick Tock Tick Tock: The Clock Is Ticking On the Payroll Tax

How serious is the Obama administration about making sure the payroll tax cut is reauthorized?  They’re calling it “doomsday” now, and they’re watching the clock anxiously, according to The Hill. “White House press secretary Jay Carney was flanked by something new at a Monday press briefing: a ‘doomsday clock’ counting down to when the employee payroll tax cut expires….Carney said the clock emphasizes the urgency for legislators to extend the tax cut.  ‘I think what this clock dramatizes that there isn’t a lot of time and that Congress needs to act and do the right thing,’ Carney said.”

The administration may be feeling the urgency, but what about Congress?  Once more, leaders from both party are radically opposed to how to pay for the extension, with Democrats still looking to have at least some of the cost covered by a small increase in taxes on those who earn more than $1 million per year.  Republicans, meanwhile, have decided to push for the extension to be paid for solely by cuts in Medicare and more pay cuts for federal workers.

Still, a bipartisan approach isn’t totally out of the question.  Democratic Senator Claire McGaskill and Republican Senator Olympia Snowe today unveiled a proposal that would extend and expand the payroll cut, and would even be paid for with the “millionaire surtax.” And to overcome the GOP objections that the surtax would hurt “small businesses” that file as individuals, they’ve allowed a business exception from the hike to make it apply just to people.

However, President Barack Obama questions the Republican need to have the payroll tax offset by budget cuts in the first place, considering they didn’t care about that at all when it came to extending the Bush tax cuts for the rich last year.  “Over the last decade, they didn’t feel the need to pay for massive tax cuts for the wealthiest Americans … Indeed, when the Republicans took over the House at the beginning of this year, they explicitly changed the rules to say that tax cuts don’t have to be paid for. So forgive me a little bit of confusion when I hear folks insisting on tax cuts being paid for.”

He then accused the party of only being for tax cuts if they are for the rich. “I know many Republicans have sworn an oath to never raise taxes as long as they live.  How could it be that the only time there’s a catch is when it comes to raising taxes on middle class families? How can you fight tooth and nail to protect high-end tax breaks for the wealthiest Americans and yet barely lift a finger to prevent taxes going up for 160 million Americans who really need the help?”

Tick tock.

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17 comments

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7:29AM PST on Dec 9, 2011

How can they turn their backs on the American Middleclass People. Perhaps it is because they are Republicans and don't care about the Middleclass People only the rich who would have to pay a minor amount of an increase in taxes. It is plain that they wanted President Obama a one term president, but who do they have to beat him. Go President Obama 2012!!!

9:39PM PST on Dec 7, 2011

Thank you.

7:12PM PST on Dec 7, 2011

This is a political biggie. Wonder how much it's going to take for the American people to really get angry?

11:08AM PST on Dec 7, 2011

The budget explained.

I love it when complex things are simplified so that we can all understand.

• United States Tax revenue: $2,170,000,000,000
• Fed budget: $3,820,000,000,000
• New debt: $ 1,650,000,000,000
• National debt: $14,271,000,000,000
• Recent budget cut: $ 38,500,000,000

Now, remove 8 zeros and pretend it's a household budget.

• Annual family income: $21,700
• Money the family spent: $38,200
• New debt on the credit card: $16,500
• Outstanding balance on credit card: $142,710
• Total budget cuts which some politicians are proud about: $385

10:32AM PST on Dec 7, 2011

Democrats made a perposal knowing republicans would reject it, republicans offered to vote yes by cutting waste out of the budget and democrats said no,

BTW, how do you calulate fair share? No democrat has yet come up with a formula

9:24AM PST on Dec 7, 2011

Although I still support President Obama, I am NOT with him on this one. The tax cap needs to be raised so that the rich pay their fair share towards Medicare & Social Security. It is very low. Americans are only paying Social Security & Medicare taxes on the first $106,800 (I believe). they make. No wonder Social Security & Medicare are in trouble. The cut was not a smart move on President Obama's part. He opened the door for the Republicans on this one. I don't know what he was thinking. Of course, a solution would be to keep the lowered % deducted from paychecks the same but increase the cap. That way it would keep helping lower & middle class Americans & raise taxes on the rich. Perhaps this is what he was aiming for - I just hope he is able to pull it off, if it is.

8:02AM PST on Dec 7, 2011

The "payroll tax holiday" was on payments for Social Security and Medicare, not a cut on income tax. Yes, we need the help, but this is not the help we need. We're killing the future of SS and Medicare with this cut, because those funds are the only things paying those two programs. Bad enough that Congress keeps "borrowing" against the trust funds - that's why those programs are in the mess they're in. We should not cut the new funds that go to them. This is not a cut I supported initially, and I still do not support it.

@ Mike C. - the *Democrats* are the party of No? LOL! The GOP's entire strategy since the 2008 presidential elections are to make sure that Obama is a 1 term president. That's why they have steadfastly caused the massive roadblock in Washington from that point, so that Obama looks bad. But guess what?

The true "Party of No", being the GOP, are the ones who look bad. The Republicans of a century ago would not recognize the politics of their counterparts today.

7:49AM PST on Dec 7, 2011

So the GOP has proven that they only care about their "oath" to Grover Norquist when it comes to raisng taxes on the rich. They are very willing to tax the middle-class (what is left of them) and the poor and take it out of Medicare, something that the less wealthy depend on when they are Seniors.

Why do they continue to swear fealty to a plan developed by Norquist when he was 10 years old? A ten year old's economic plan is running the GOP. What does that tell you?

7:10AM PST on Dec 7, 2011

Dear Mike C. - Is this the latest GOP talking point? Calling the Democrats the Party of No? That is as silly as a kid on the playground sticking out his tongue and saying "Everything you say to me sticks to you!" Do they stick their fingers in their ears and say "nah, nah, nah" as well?
Thanks for a good laugh. They are hard to come by around here.

7:05AM PST on Dec 7, 2011

democrats seem to be the party of no, and rather than leading, obama is right in there saying no.
four more years with a president who does not understand leadership, don't think so.

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