A battle over the Bush tax cuts

President Obama launched an election-year tax fight this week, proposing to extend the Bush tax cuts for one year on income of less than $250,000, while allowing taxes on the wealthiest 2 percent of Americans to rise. The White House said the proposal, which would let the top tax rate increase from 35 to 39.6 percent, would raise $829 billion in new revenue over the next decade. GOP presidential candidate Mitt Romney quickly dismissed the plan as economically harmful, saying that higher taxes on “small businesses and job creators” would only “kill jobs.”

The president is right, said The New York Times in an editorial. Higher taxes on the wealthiest Americans are “a matter of fairness and responsible policymaking.” Without them, we can never move ahead toward “solving the nation’s budget problems.” The Republicans’ insistence that this plan will hurt small businesses “is nonsense”; in fact, only about 2.5 percent of small-business owners would have to pay more. We can only hope that middle-class Americans won’t allow the economy to be “held hostage” by the GOP’s fealty to the rich.

This plan “makes no economic sense,” said Jonathan S. Tobin in CommentaryMagazine.com. The last thing our weak economy needs is “a massive tax increase on those with the capital to invest and therefore create jobs.” And it’s simply false that taxes on the wealthy would merely revert to Clinton-era rates, as Obama insisted this week, said The Wall Street Journal. Does he think we’ve forgotten about the billions of dollars in growth-killing Obamacare taxes and surcharges on investment income? And even if higher income taxes affect only a fraction of small businesses, they would hit the most productive of them—the very ones “most likely to hire workers.”

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Obama—and everyone else in Washington—knows this plan won’t make it through the Republican-led House, said Patricia Murphy in TheDailyBeast.com. But that’s beside the point. By lining up on whether or not to tax the rich, both parties get to “remind voters of what is at stake in the November elections.” As they dig in to their positions, however, they can’t be allowed to forget that unless Congress acts, all Americans will see their taxes increase when the Bush tax cuts expire on Jan. 1. Right now, “no one in Washington is talking about that.”