Economy Alarm: Dems Revoke President’s Promise, Propose Tax Hikes on Middle-Class Families

June 23, 2010

Dems Revoke President’s Promise, Propose Tax Hikes on Middle-Class Families
Despite Campaign Promises, Democrats Now Look to Tax Increases on Families Earning Less Than $250,000 a Year

President Obama Has Repeatedly Promised Middle-Class Families Would be Exempt from Tax Hikes

“Obama repeatedly vowed during the 2008 presidential election campaign that he would not raise taxes on individuals making less than $200,000 and households earning less than $250,000 a year.” (Rich Miller, “Obama ‘Agnostic’ on Deficit Cuts, Won’t Prejudge Tax Increases,” Bloomberg, 2/11/2010)

“He went on to say that the initiatives would ‘focus on easing the burdens on middle-class families who are struggling in this economy, and providing the help they need to get ahead.’ Well, they would ease them a little bit, perhaps, but not much.’” (Michelle Singletary, “President Obama proposals offer modest help to the middle-class,” Washington Post, 1/28/2010)

Credibility Crash: Dems Break Obama’s Campaign Pledge, Propose Tax Hikes on Middle-Class Families Below the $250,000-a-Year Threshold

Democrats are looking at the possibility of raising taxes on families below the $250,000-a-year threshold promised by President Barack Obama during the election.

The majority party on Capitol Hill does not feel bound by that pledge, saying the threshold for tax hikes will depend on several factors, such as the revenue differences between setting the threshold at $200,000 and setting it at $250,000.

“You could go lower, too — why not $200,000?” said Sen. Dianne Feinstein (D-Calif.). “With the debt and deficit we have, you can’t make promises to people. This is a very serious situation.”

Sen. Byron Dorgan (N.D.), chairman of the Senate Democratic Policy Committee, concurred, saying, “I don’t think there’s any magic in the number, whether it’s $250,000, $200,000 or $225,000.

Feinstein said the economy has not recovered as much as Democrats had hoped and uncertainty about the availability of credit remains a problem.

In the aftermath of the financial crisis in Greece, credit markets have been spooked by questions of whether nations will be able to pay their rising debts.

“We have to be very careful what we do to further reduce tax revenues,” Feinstein said.

Thus, raising taxes on families who earn between $200,000 and $250,000 has become more palatable among Democrats.

Federal spending and debt are widely, although not universally, regarded among economists as unsustainable.

During an appearance on Fox News Sunday at that time, Bowles said the president told him that everything should be on the table.

Senate Republicans accused Democrats of breaking Obama’s campaign pledge.

“It is noteworthy that the Democratic leader, the majority leader of the House, is saying that we need to, in effect, raise taxes on the middle class, and the president ought to back off of that pledge as a way to get even more money to spend,” said Senate Republican Leader Mitch McConnell (Ky.).

“Clearly, that’s the wrong direction, and I don’t think that’s what the American people are asking for,” he added. (Alexander Bolton, “Dems: We’re not bound by president’s tax vow,” The Hill, 6/22/2010)

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