About five months ago, during Senate debate over the proposed American Jobs Act, the White House and nearly all congressional Democrats rallied behind a popular financing option: invest in job creation and create a surtax on millionaires and billionaires to pay for it.
Senate Republicans, not surprisingly, ignored polls showing broad national support for the idea. The Democratic surtax measures died at the hands of a GOP filibuster.
In an unexpected development, however, a conservative House Republican has apparently decided to break ranks on the issue.
Freshman Republican Rep. Rick Crawford will propose a surtax on millionaires Thursday morning, a crack in the steadfast GOP opposition to extracting more money from the nation's top earners.
The Arkansas Republican will unveil the plan during a local television interview Thursday morning, and plans to introduce legislation when the House returns next week, according to sources familiar with his thinking.
Crawford will propose the additional tax -- expected to be north of 2.5 percent -- on individual income over $1 million as part of a broader fiscal responsibility package.
To say this is unusual is an understatement. Thanks in part to Grover Norquist's pledge, Republican anti-tax rigidity has been unyielding for many years. GOP officials are occasionally comfortable recommending federal tax increases on low-income families who are not currently eligible to pay a federal income tax; and will sometimes consider new "revenue" so long as taxes remain unchanged; but for a Republican to ask the wealthy to pay a little more is unheard of in recent decades.
It makes Crawford's proposal a breakthrough moment -- or at least, a possible breakthrough moment. There are a couple of catches to keep an eye on.
The first is that the Arkansas congressman is willing to support a millionaires' surtax, not to create jobs, but to lower the deficit. In the context of a fiscal debate, Crawford's measure would, in fact, be a sensible part of a debt-reduction package, but most Democrats -- as well as most economists -- believe economic growth and job creation are far more important than bringing the budget closer to balance.
In this sense, the freshman's idea may have merit, but he intends to apply the new revenues to the wrong problem.
Second, before we can evaluate Crawford's idea, it's important to know what he expects in return for the surtax. The article said this would "part of a broader fiscal responsibility package," but the devil's always in the details. Could Democrats go along with a plan that includes a 2.5% surtax on millionaires and billionaires? Sure. Would they trade the surtax for Medicare privatization? Of course not.
This is a worthwhile concession, but if it comes with too great a cost, any hopes for a deal will fall apart quickly.
And finally, other congressional Republicans haven't exactly thrown their support behind Crawford's measure. The Arkansan hasn't faced GOP excommunication just yet, but if his fellow Republicans stick to the usual script -- no tax increases on anyone at any time by any amount for any reason -- then his offer will have symbolic significance, but no practical effect.
Crawford appears to have taken a step towards a larger compromise. But there are an awful lot of additional steps between this and his destination.
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Not measuring the Congressman's intent, or purpose, I'd just like to project the Republicans would do well to recognize we commoners are watching to see who will launch an effort to bring tax fairness to our governmental revenue sources. An indexed income tax rate, ceasation of corporate tax subsidies, and the elimination of tax write offs for the uber rich among us would be a good start.
If any bold Republicans still exist, they'd take the tax policies from past five Republican administrations (Eisenhower, Nixon, Reagan, Bush the Elder and Bush the Younger), average them, and then pronounce the results as the tax reform they can support! All tax rates of all post-WWII Republican administrations averaged together would indeed produce the deficit reduction while freeing up government spending on infrastructure and investment, putting even more Americans back to work, and rebuilding a healthy economy!
Ike's tax rates averaged with all subsequent Republican tax rates would bring the average up enough from the disasterous Bush Tax Cuts of the early 21st century to provide a viable level of fair taxation, and government solvency!
I won't hold my breath! -Kevo
Kevo, I'd be quite content to go with Reagan's tax rates. Easy to sell, and they do have that lovely "no special treatment for capital gains" feature.
Another article on this same topic states that one of the Republican's requirements on this proposal is a balanced budget amendment, which is complete lunacy. A balanced budget requirement during the Bush Recession would have removed most of the tools the government had at its disposal and necessitated large spending cuts AND large tax increases, which would have sent us straight into a Depression. Those spending cuts and tax increases would surely have deepen our economic problems and sent us into a continuing cycle from which recovery may well be impossible.
A balanced budget amendment is only a Republican excuse to cut public spending and give the money to the rich.
Imagine how the Republicans would howl if the price of a balanced budget were to cut the Defense Department budget in half and double the taxes on the wealthy (which would still be a lower tax rate than it was during the Eisenhower administration).
Yeah, the details are pretty unsavory. I hope the GOP executes him as a traitor for this rubbish. Privatize Medicare my ass.. This guy is smoking the local shrubbery..
I thought Reagan was the only Republican former president that existed in GOP history, since Lincoln.
Lincoln was a progressive.
As the new party on the block, the Republican Party of Lincoln [i'm being respectful here coz it is not the crazy modern Party] was formed to further the interests of the people not the rich.
Examples of progressive planks in the 1860 platform are : [all of them passed 1 way or another]
The Homestead Act, which cut the speculators out of the loop, denying them a piece of the action and almost giving the land to the settlers.
On civil rights-- no extension of slavery into the territories and a hope to end it in the south fairly soon.
On extending Federal Gov. power into new areas-- internal improvements should be made to the rivers of the Mississippi drainage and a transcontinental railroad should be built partly with Federal money or land grants.
After the war started Lincoln got passed the 1st Income Tax, it started at $10,000 which adjusted for changing wages might be around $500,000 now.
All of these seem like progressive positions to me.
Obviously this guy will not be seeking re-election! And the "devil IS the details" when it comes to dealing with the GOP!!
The surtax concept usually means the tax is only temporary. It is not a permanent increase in the tax rates. This may be just more Republican sleight of hand if the Congressman expects Dems to agree to permanent cuts in the budget in exchange for a temporary surtax.
Why call it a surtax? Why not just bring the tax rate up and close loopholes? Calling it a surtax implies that it is a punishment or just a temporary fix.
Surtax is a funny name for this. But then this is the party that claims their anti-abortion and anti-contraception crap is religious freedom.
Gosh and I always thought freedom meant the right to make your own choice without fear of reprisal.
Close loopholes? Paul, when a Republican says "close loopholes" he means eliminate the deductions on your itemized deductions Schedule A. Most of those deductions are phased out for high income people anyway so eliminating them for those high-income people will not raise taxes for the rich but raise taxes for everyone else.
Republicans say the same thing with the phrase "flatten the tax code". This means cut taxes for the rich, raise taxes for everyone else.
Thanks for the clarification.
It's here: We thought that the better way to do that was to limit the deductions and credits, the so-called loopholes, derive the revenue that way and, in doing so, you can both reduce some of the rates and have enough revenue to actually apply it to deficit reduction.
Sounds suspiciously like gw's "let's invest Social Security in the stock market" b.s., sloppily crafted to royally screw the little people. Republicans still don't seem to realize that just because we're not rich, that doesn't make us stupid. No deal, no way.
Sounds fishy. I think they are up to something.
Reagan was the master at sleight of hand. When he cut taxes he also increased the threshold for taking personal deductions such as medical costs. Later when taxes were increased, those deduction thresholds were not lowered. He gave you the tax cut with one hand and took away deductions with the other hand. Every Republican scheme has been the same. Voters thought they were getting something with the tax cut, but it was only an illusion.
better watch this with both eyes wide open !
More than the details, I'm curious about which tea leaves convinced him that the time was right for this move.
just might be this one, has a set of gonads
Estimates from the Tax Policy Center show that those who make more than $1 million do pay a 29% tax rate, so many high-income earners are already paying a higher percentage of their income in taxes than their secretaries. http://bit.ly/yyLJDp
The real tax problem with the tax code is that it helps pick winners and losers with special-interest tax breaks. But, the solution to this problem is not to add more taxes on top of the existing system.
The only way to improve tax fairness and increase corporate competitiveness is to rebuild the tax code from scratch. Using the Bowles-Simpson deficit-plan as a guideline Congress can simplify the tax code, improve fairness, and spur economic growth. http://bit.ly/noTDPF
But, why did Bush not use budget "surplus" to pay down debt instead of tax rebates?
http://zfacts.com/p/318.html
http://www.nytimes.com/2011/07/24/opinion/sunday/24sun4.html
I do not trust this at all, although it appears (yeah, it is fishy smb1970) that maybe Campbell crossed his fingers if he signed the Norquist pledge?
Federal debt is where it starts. Either we destroy it or it destroys us. Nothing else matters for this nation's future.
Republicans intend ONLY to increase debt with tax cuts for the rich. If Republicans take the Senate and keep the House, unlikely but possible, they WILL block raising the debt ceiling and shift general tax revenues to the rich as interest on their Treasuries. This in turn will result in general impoverishment and the rise of civil unrest as Republicans say "the government is broke because we gave all your money to the rich. What's the problem?" They say that right now if you listen.
Democrats MAY be able to control debt, as they did before, but lately their incompetency shows inability to meet the challenge. FDR recognized that Republicans were America-hating traitors- "I welcome their hatred"- and Democrats crushed the bastards until 1964 when Johnson failed to recognize the threat and was destroyed himself. Unless Democrats recognize the Republican threat Republicans WILL destroy this country which they hate with a passion. Everything Republicans do without exception leads to tax cuts for the rich paid for with debt, debt which leads directly to national bankruptcy, civil unrest, and a fascist coup. If anyone shows ONE thing a Republican does that does NOT lead to fascism I'd like to know. "Crawford will propose the additional tax -- expected to be north of 2.5 percent" give me a break, that's not going to get a handle on $15.5T in debt and $1.5T in yearly defense waste, it's a joke.
"Crawford will propose the additional tax -- expected to be north of 2.5 percent"
As stated below, letting the Bush tax cuts expire will raise taxes on the rich 12.5%, back to Clinton levels, when the federal budget was barely balanced. Debt and spending are higher now. A 2.5% surcharge is knowingly insufficient. It's a fake.
I do agree the Republicans are those in the founding days that wanted to keep the British rule and have a king to collect the taxes, give to businesses, colonizing the world.
That is what they are saying, I've heard it myself.
When you understand Republicans are Loyalists and Democrats are Patriots then current events make sense. These days, the Patriots have lost their nerve and the Loyalists are winning, or, as they say, taking the country back.
A 2.5% surtax? Chump change. Letting the Bush tax cuts will raise taxes on the rich 12.5%.
A 2.5% surtax? Chump change. Letting the Bush tax cuts expire will raise taxes on the rich 12.5%.
"earners"?? whoa. they earned what, now?
Grover Norquist is a tool, and his pledge has done nothing but destroy our economy - Jon Stewart pwn'd him the other night on TDS, stating the following: "Here's the problem. It's very easy - there is nothing people want to hear more than, 'You give us too much money, you should keep more.' That's the easy part. That's like, 'I've got a pledge. Ice cream and cake for everybody.' Here's my second pledge. 'You've got to exercise.' Oh, but I'm not going to enforce that one. But we're all gonna get thinner. So when you come out and say, we're never gonna raise taxes, I understand that's a great branding, but as a governing policy it seems too easy and pandering." Bush II failed this pledge miserably, hiding two wars from the budget so it would look like he was adhering to the lower spending portion of the pledge and cutting taxes for the richest Americans. Norquist and his pledge are 20th century thinking - time for some real thinkers to step forward.
A political play knowing the Democrats cannot support it.
The deadline for filing in Arkansas has passed, and it is certain that he will have an uncontested primary. That HAD to play into this decision.
Grover Norquist and "Rich Lamboink," the latter so called because of his being rich, his tendency to lambaste, and his being an oink, were little more than their generation's answers to Nineteenth Century political bosses Mark Hanna and William Tweed, to name but two.
Ms. Maddow could not have failed to see the corruption inherent in their activities.
yay 1 Republican joins the Sane group I'm a Moderate Republican and looks like i'm voting for Obama this 2012 because he is the only sesible option. I hope this starts the Ball on fixing the tax system and making Rich Pay Higher Taxes
You mean Nordquist missed a SIGNATURE??! Question what moron would sign a pledge that was created by a 12 year old( the age that Nordquist said he was when he created it) What does that say about a grown person signing a contract a 12 year old made up?........
"When the house returns next week "???????????When do these useless @!$%#s ever do anything for the people of the USA,you know the ones who pay your salaries...........
Smart man...
Regardless of the point-well-taken caveats, I simply must say,
"Thank you, Mr. Crawford. Well done."
comfortable recommending federal tax increases on low-income families who are not currently eligible to pay a federal income tax
How do you raise taxes on the lowest income brackets without raising taxes on everyone else as well?
You people are amazing. Give one example of when raising taxes has spurred economic/GDP growth? It didn't work for Hoover or for FDR, in fact it only kept the US in the depression years longer than it ever should have been...only WWII got the US out. And, what happens when you raise taxes on the "rich" and GDP growth subsequently falls, which it will? Guess what, you take in less tax revenues every year unless you continue to increase taxes every year...a downward death spiral. Don't believe it, go live in Europe as I did and you'll see it firsthand.
Now, compare and contrast this to what has happened when taxes have been cut over the past 50 years, first by JFK (a wild-eyed Republican? No, try a sane Democrat), then by Reagan and then by the "evil" Bush. In all cases, economic growth jumped and the tax base went up with it...supply side economics has worked each and every time it is applied...wake up and smell the coffee.
Even "evil" Bush's tax cut (approved by a Democratic-controlled Senate by the way) helped the US come out of the Clinton-recession spurred by the high tech stock market bubble bursting in March of 2000, closely followed by 3 consecutive quarters of negative leading economic indicators (3rd, 4th of 2000 and 1st of 2001). I know, it didn't really happen, just listen to the Democratic Party-affiliated economists and the news media and you'll believe that lie...it did happen and it wasn't pretty.
And, despite 9/11, the subsequent war in Afghanistan and an unfinished war in Iraq (all three thanks to Clinton doing nothing effective against AQ or against Iraq for 8 years), the US maintained 3-4% GDP growth and 4% (or lower) unemployment from the end of 2003 until the last several months of the "evil" Bush period in 2008...wow, horrible economic times!!! If you don't believe it, go check for yourself instead of believing this "self-licking ice cream cone" blog page and MSNBC.
And during his 8 years in office, fighting two wars and expanding Medicare to include prescription drugs, "evil" Bush raised the national debt from 6T to 10T USD, a staggering total amount of 4T USD. Staggering, unless you consider that Obama and the Dems have raised it from 10T to 15.5T USD, that's 5.5 TRILLION USD, in just THREE years, and it will grow to 16.7T by mid-year. And for what? 8%+ unemployment and anemic GDP growth? Let's face it, the stimulus package failed miserably.
So all of you say (it seems like "all" but maybe I missed one rational voice in this ridiculous chain), raise taxes and screw the rich guys who are the economic engine in the US...screw them because like Bush, they are "evil" and you are good. Man, how moronically simplistic you are. Do you really think the government bureaucrats can effectively take money from the rich and give it to the poor without killing the goose that laid the golden egg? You need to go and work in the US Federal government and see for yourself how inherently inefficient it is.
But hey, don't believe me, believe a right-wing Republican like Alvin Lee from "Ten Years After" at Woodstock:
Everywhere is freaks and hairies
Dykes and fairies, tell me where is sanity
Tax the rich, feed the poor
Till there are no rich no more
I'd love to change the world
But I don't know what to do
So I'll leave it up to you
Well, all except for the last line because I'm not leaving it up to you that's for sure. Maybe you should read Adam Smith's "Wealth of Nations" vice relying solely on Marx's "Das Kapital"...it would give you some balance.
P.S. - and if you want a real solution to the debt, it's simple, CUT SPENDING -- it's the spending stupid.