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  1. #1
    Senior Member JohnDoe2's Avatar
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    The rich will pay more taxes, Boehner says

    The rich will pay more taxes, Boehner says

    By Dana Bash and Tom Cohen, CNN
    updated 4:00 PM EST, Wed December 5, 2012

    No fiscal cliff deal in sight

    Washington (CNN) -- Taxes on the wealthy are going up, House Speaker John Boehner conceded Wednesday in challenging President Barack Obama to sit down with him to hammer out a deal for avoiding the fiscal cliff.

    Obama, however, continued to insist on Republicans first ensuring no tax hike for anyone but the top 2% of Americans as a first step toward a broader agreement on tackling the nation's chronic federal deficits and debt.

    The statements reflected how negotiations on the automatic spending cuts and tax hikes set to occur on January 1 -- the fiscal cliff -- have evolved since Obama's re-election last month.
    Republicans once opposed to any new revenue in their quest to shrink government now realize Obama's victory and public support for the president's campaign theme of higher taxes on the wealthy leave them with little negotiating leverage.
    Less than four weeks from the fiscal cliff, GOP leaders face a choice: Agreeing to Obama's demand to hold down tax rates on most Americans while allowing higher rates on top earners, or being blamed for everyone's taxes going up in 2013.
    The major unresolved question of negotiations involving the White House and congressional leaders is whether eliminating tax deductions and loopholes -- as proposed by House Republicans -- can raise enough revenue without hitting middle-class Americans too hard.
    "We have got to cut spending and I believe it is appropriate to put revenues on the table," Boehner told reporters on Wednesday. "Now, the revenues that we are putting on the table are going to come from guess who? The rich."
    He continued by saying "there are ways to limit deductions, close loopholes and have the same people pay more of their money to the federal government without raising tax rates, which we believe will harm our economy."
    In remarks to business leaders on Wednesday, Obama said Boehner and Republicans have to take the first step.
    "I think there is recognition that maybe they can accept some rate increases as long as it is combined with serious entitlement reform and additional spending cuts," the president said. "And if we can get the leadership on the Republican side to take that framework, to acknowledge that reality, then the numbers actually aren't that far apart."
    He added that "we can probably solve this in about a week -- it's not that tough."
    At the same time, Obama rejected tying the negotiations to the need to raise the federal debt ceiling, like the brinksmanship last year that led to an unprecedented downgrade in the U.S. credit rating.
    Boehner has said a debt ceiling increase would require an equal amount of spending cuts or other deficit reduction.
    "If Congress, in any way, suggests that they are going to tie negotiations to debt ceiling votes and take us to the brink of default once again as part of a budget negotiation, which by the way we have never done in our history until we did it last year, I will not play that game," Obama said. "Because we've got to break that habit before it starts."
    Economists warn that the fiscal cliff's automatic tax hikes and spending cuts would invite recession.
    Polls show that more Americans will blame Republicans, instead of Obama and Democrats, if there is no deal and the nation goes over the fiscal cliff.
    A Washington Post/Pew Research Center survey released Tuesday put the margin at 53%-27% in citing Republicans or Obama. A CNN/ORC International poll released last week showed 45% would blame congressional Republicans compared to 34% who would hold Obama responsible.
    Republican Rep. Raul Labrador of Idaho acknowledged Wednesday that his side was losing the messaging battle.
    "We continue to talk about tax rate increases instead of how tax rate increases actually affect individuals," Labrador said, adding: "We're identified as a party that only cares about business. We should care about individuals."
    All signs point to a continuing standoff, at least for now. No formal negotiating sessions are known to be scheduled, and congressional aides say no back-channel discussions are taking place.
    The House is scheduled to adjourn for the year on December 14, but House Majority Leader Eric Cantor said Wednesday the chamber would remain in session until a fiscal cliff deal gets reached.
    Boehner and other Republican leaders implored through the media for Obama to talk to them about the deficit-reduction plan they offered earlier this week, which the White House rejected as unrealistic.
    Asked about Congress scheduling no further business this week with GOP members going home, Boehner said: "I'll be here and I'll be available at any moment to sit down with the president to get serious about solving this problem."
    Rep. Kevin McCarthy added a dramatic flair, calling the next 72 hours "critical" for the negotiations.
    If Obama "sits back and continue to play politics, that'll give your answer of where we're going," he said, calling the moment "an opportunity for the president to lead."
    At issue are competing proposals by Obama and House Republicans that coincide in some areas but differ on the tax-rate question.
    Obama demands that the House immediately pass a measure already approved by the Senate to extend tax cuts for families making less than $250,000 a year while allowing rates to return to higher Clinton-era levels for wealthier households.
    Both sides agree that the 98% of Americans making less than $250,000 a year should avoid a tax hike when the tax cuts from the Bush administration expire on December 31, Obama and Democrats argue. They call for the House to guarantee that outcome by passing the Senate measure now.
    Once that happens, Obama and Democratic leaders promise, they will work out compromises on other deficit reduction steps sought by Republicans, such as reforms to the Medicare and Medicaid entitlement programs as part of further spending cuts.
    In an interview with Bloomberg TV aired on Tuesday, Obama said Republicans need to accept the reality that deficit reduction requires higher tax rates on the wealthy.
    "The issue right now, that is relevant, is the acknowledgment that if we're going to raise revenues that are sufficient to balance with the very tough cuts that we have already made and the future reforms in entitlements that I'm prepared to make, then we are going to have to see the rates on the top 2% go up, " the president said. "We will not be able to get a deal without it."
    At the same time, Obama said negotiations next year on broader tax reform could bring lower rates.
    House Republicans led by Boehner made a major proposal on Monday by offering a series of steps to reduce the nation's chronic federal deficits by $2.2 trillion over 10 years.
    The GOP proposal includes $800 billion from tax reform, $600 billion from Medicare reforms and other health savings and $600 billion in other spending cuts, House Republican leadership aides said. It also pledges $200 billion in savings by revising the consumer price index, a measure of inflation.
    While the Republicans gave ground by calling for more revenue through tax reform, the plan only mentioned unspecified elimination of some deductions and loopholes.
    At the same time, they rejected the Democratic call for higher tax rates on wealthier Americans, contending the move would inhibit economic growth by raising taxes on small business owners, many of whom declare business profits on their personal income tax returns.
    The White House and Democratic leaders immediately rejected the Republican approach, saying it lacked specifics and would require middle-class taxpayers to assume a greater burden while easing rates on the rich.
    Jason Furman, an assistant to Obama on economic policy, told reporters Wednesday that the president wants to ensure additional revenue from higher taxes on the wealthy now to help avoid the fiscal cliff. He described the Republican proposal for more revenue as lacking specifics.
    "Tell us what it is. Show us a score," Furman said. "Tell us how it locks in revenue because you're trying to actually pass a bill this year, not engage in some long process around tax reform, which we don't have time to do by the end of this year. "
    On Tuesday, leading conservatives blasted the House Republican proposal that breaks with years of GOP orthodoxy by calling for more taxes to be paid by wealthier Americans.
    Sen. Jim DeMint, R-South Carolina, said the "offer of an $800 billion tax hike will destroy jobs and allow politicians in Washington to spend even more." Sen. Rand Paul, R-Kentucky, said it would be "a huge mistake to raise taxes. It will cripple the economy."
    However, some top Senate Republicans -- many of them conservatives -- withheld harsh criticism of the plan even as they refused to embrace it.
    Senate Republican Leader Mitch McConnell sidestepped the question when asked directly if he backed the plan.
    "I commend the House Republican leadership for trying to move the process along and getting to a point where, hopefully, we can have a real discussion," McConnell said.
    Sen. Charles Grassley of Iowa, a senior Republican on the Finance Committee, said he would support Boehner's plan to raise revenue, but only if there is a "willingness on the part of Democrats to accept spending cuts that are three-to-one or four-to-one."
    The current negotiations take place amid the lame-duck session of Congress before the newly elected legislators arrive in January. Possible outcomes include an agreement now to avoid the fiscal cliff and devise a framework for further negotiations in the new Congress on a broader deficit reduction deal.
    While the White House has made clear Obama will veto any measure that fails to increase tax rates on the wealthy, aides have signaled a possible willingness to negotiate the specific rate increase.
    Asked repeatedly Tuesday about whether Obama insisted on a return to the 1990s rates on income over $250,000 for families or $200,000 for individuals, White House spokesman Jay Carney responded by saying the president would refuse to sign any measure extending the current lower rates.
    In the interview with Bloomberg TV, Obama said lower tax rates for the wealthy could be negotiated as part of broader tax reform in 2013, but only after those rates increase now.
    Obama's deficit-reduction plan would increase taxes by almost $1 trillion over 10 years, a significant portion of a $4 trillion overall deficit-reduction goal.
    It also would close loopholes, limit deductions, raise the estate tax rate to 2009 levels and increases tax rates on capital gains and dividends.
    The Obama plan includes $50 billion in stimulus spending for programs intended to create jobs, such as repairing roads and bridges.
    Experts have said failing to reach a fiscal cliff deal and devise a framework for a broader deficit reduction package to be negotiated when the new Congress is seated in January will cause economic turmoil.
    The non-partisan Tax Policy Center estimates that middle-class families would pay about $2,000 a year more in taxes without action.
    For now, the debate has the business community perplexed, said Fred Smith, the chief executive officer of FedEx Corp., considered a bellwether on the economy.
    Smith told CNN Tuesday that he and other top business leaders "look at the situation in Washington with complete amazement and dismay."
    "The problem is the ideological pinnings on both sides of this argument are so difficult to bridge," Smith said, adding it will "be hard for them to get a deal."

    http://www.alipac.us/f19/clearest-indication-yet-polar-ice-sheets-melting-fast-268104/
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  2. #2
    Senior Member HAPPY2BME's Avatar
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    If U.S. hikes taxes, high-income Californians might pay almost 52 percent

    posted at 9:21 pm on December 5, 2012 by Erika Johnsen


    Whether it’s because we end up going over the fiscal cliff or because Republicans agree to President Obama’s plan of not extending the Bush tax cuts on America’s wealthiest earners, the possibility of an effective tax hike means that higher-income Californians may be in for a whopping aggregate marginal tax rate. The super-liberal state already succeeded in approving their own rate hike with Proposition 30 in the November election, and combined with the potential federal raises, they could be looking at a top bracket with a marginal income tax rate of just under 52 percent:
    Gerald Prante, an economics professor at Lynchburg College in Virginia, and Austin John, a Lynchburg economics student, calculated marginal tax rates — the highest rates on the highest levels of income — for all 50 states. They combined state, federal and, where applicable, local income taxes, plus payroll taxes for Social Security and Medicare and included the deductibility of some taxes.
    Proposition 30 added three percentage points to the marginal state income tax rate for California’s highest-income taxpayers, bringing it to 13.3 percent. That action raised California over other high-tax jurisdictions to a marginal rate of 51.9 percent, slightly higher than New York City’s level. Hawaii was the only other place with a calculated rate above 50 percent.
    …Ouch. We already knew that California was headed for a fall, but here’s yet another problem with top-down government and specifically with President Obama’s proposals to hike taxes across-the-board on those he deems wealthy, i.e. families making more than $250k/year. As Joel Kotkin writes for Forbes, it’s kind of odd that blue states voted so overwhelmingly against their own self-interest in reelecting Barack Obama, because the tax hikes he campaigned on will come down disproportionately hard on the economies of blue states. The demographics and costs of living in different geographic regions suggests that being rich means very different things to different regions:
    Any move to raise taxes on the rich — defined as households making over $250,000 annually — strikes directly at the economies of these states, which depend heavily on the earnings of high-income professionals, entrepreneurs and technical workers. In fact, when you examine which states, and metropolitan areas, have the highest concentrations of such people, it turns out they are overwhelmingly located in the bluest states and regions. …
    The people whose wallets will be drained in the new war on “the rich” are high-earning, but hardly plutocratic professionals like engineers, doctors, lawyers, small business owners and the like. …
    What would a big tax increase on the “rich” mean to the poor and working classes in these areas? To be sure, they may gain via taxpayer-funded transfer payments, but it’s doubtful that higher taxes will make their prospects for escaping poverty much brighter. For the most part, the economies of the key blue regions are very dependent on the earnings of the mass affluent class, and their spending is critical to overall growth. Singling out the affluent may also reduce the discretionary spending that drives employment in the personal services sector, retail and in such key fields as construction.

    If U.S. hikes taxes, high-income Californians might pay almost 52 percent « Hot Air
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  3. #3
    Senior Member HAPPY2BME's Avatar
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    We already knew that California was headed for a fall, but here’s yet another problem with top-down government and specifically with President Obama’s proposals to hike taxes across-the-board on those he deems wealthy, i.e. families making more than $250k/year.
    --------------------------------------------------

    A family making $250k/year after taxes in California is actually making less than $100k when all the other non-reportable taxes (e.g., over-the-counter purchases on food, clothing, expendables, household goods) are factored in.

    As goes California ..

    We are already in a socialist state.
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  4. #4
    Super Moderator Newmexican's Avatar
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  5. #5
    Senior Member JohnDoe2's Avatar
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    Taxes aren't the only problem. Jobs get cut too.

    NC businesses fear crashing over 'fiscal cliff'




    Raleigh, N.C. — With only one month until across-the-board federal budget cuts kick in, the White House and Congress continued to maneuver Friday for political leverage in the national debt debate.

    President Barack Obama urged Congress on Friday to pass an extension of tax cuts for middle-class families, saying a tax increase for them would be like a "lump of coal" for Christmas.

    In his first campaign-style event to sell his solution on the so-called "fiscal cliff," Obama was in Philadelphia suburbs to say that Republicans should extend existing Bush-era tax rates for households earning $250,000 or less while allowing increases to kick in for the wealthy.


    Democrats and Republicans need to "get out of our comfort zones" to reach an agreement, he said.

    The president toured a manufacturing facility that builds construction toys, joking that he's keeping his own "naughty and nice list" for Congress and telling the public to pressure lawmakers to pass the tax cut extension for the middle class.

    U.S. House Speaker John Boehner, meanwhile, said current talks have reached a stalemate. He and other Republican leaders are calling on Obama and Democrats to give more spending cuts than are currently on the table, saying tax increases would hurt small businesses just coming through the recession.

    "Hopefully, folks in Congress and the White House will show some leadership and do the right thing for America and North Carolina," said Lew Ebert, president of the North Carolina Chamber.

    If no deal is reached, some economists predict the U.S. economy could fall back into recession. Estimates suggest 3.4 million jobs could be lost nationwide.

    "It could be a real blow to the North Carolina economy at a time we could ill afford it," Ebert said.

    A recent report from the National Association of
    Manufacturers says more than 1 million private-sector jobs are at risk, including 34,000 in North Carolina.

    Cary-based Lord Corp., which makes products from adhesives to vibration- and motion-control devices, plans to hire 70 people next year, including scientists, engineers and salespeople. President and Chief Executive Rick McNeel said those plans would be jeopardized if no agreement is reached by the deadline.

    "It's a national issue. It's a state issue. It's an issue for Lord," McNeel said.
    More than a third of the global company's business is in aerospace projects, including 15 percent in defense contracts.

    "I think it'll be an issue for many companies that have no idea it's going to be an issue for them," McNeel said.

    http://www.wral.com/obama-takes-middle-class-tax-cut-pitch-outside-dc/11830018/
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  6. #6
    Senior Member JohnDoe2's Avatar
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    "Fiscal cliff" would hit New Yorkers with $43 billion taxes: NY Comptroller

    By Hilary Russ | Reuters – 6 hrs ago

    (Reuters) - New York residents would suffer more than $43 billion in tax hikes in 2013 if Congress fails to resolve the so-called fiscal cliff negotiations, according to New York State Comptroller Thomas DiNapoli.

    The federal spending cuts and tax increases, known as the fiscal cliff, are set to go into effect on January 1 unless lawmakers reach a compromise. On Wednesday, Republican leaders in the U.S. House of Representatives said talks with President Barack Obama were deadlocked.
    "There is real danger ahead for New York's economy if America goes over the fiscal cliff," DiNapoli said in a prepared statement. He is scheduled to present a new report on the effects of the fiscal cliff on Thursday morning at a forum with business and labor leaders.
    Taxes would rise sharply on January 1 for virtually all 8.9 million working New Yorkers, DiNapoli said in the report.
    A pending 47 percent increase in the payroll tax rate would cost New Yorkers $7.7 billion. An extra 3.4 million people in the state would have to pay the federal alternative minimum tax in addition to the 500,000 who currently pay it.
    From Buffalo to New York City and towns in between, the state and its local governments together would also lose $609 million in federal aid in 2013, including $210 million in education funding, according to Federal Funds Information for the States.
    Total lost federal aid over nine years could be about $5 billion, DiNapoli said, citing calculations from the New York State Division of the Budget.
    Federal lawmakers have also proposed limiting the tax exemption on municipal bonds as a way to raise revenue, but that would bump up costs for the state and other borrowers, DiNapoli said.
    "Any change in the tax-exempt status of municipal bonds could force the state, municipalities, school districts, and public authorities to make a choice between passing on higher costs to taxpayers, or reducing capital investments for essential infrastructure," he said.

    http://news.yahoo.com/fiscal-cliff-hit-yorkers-43-billion-taxes-ny-040049472.html
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  7. #7
    Senior Member JohnDoe2's Avatar
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    N.C. congressional delegation will compromise to avoid fiscal cliff

    Posted Thursday, Nov. 29, 2012Updated Thursday, Nov. 29, 20120

    By Franco Ordońez
    The Charlotte Observer


    WASHINGTON, D.C. — Members of the N.C. congressional delegation say they’re ready to compromise on some hardened positions to reach a deal that would prevent the country from plunging over the “fiscal cliff.”

    Failing to reach an agreement by the end of the year would trigger tax hikes and massive cuts in spending on federal programs.

    N.C. Rep. Howard Coble is the latest Republican who says he’s willing to buck one of the party’s sacrosanct pledges to not raise taxes.

    For over two decades, conservative activist Grover Norquist has been getting GOP members of Congress to sign his Americas for Tax Reform pledge. It puts them on record as opposing any tax increases. That includes eliminating deductions.

    “I’m not enthusiastic about it (the possibility of a tax increase),” says Coble, a longtime congressman from Greensboro who signed the pledge around 1986 during his second term. “But I don’t think anything should be off the table. Just because I advocate for that, I may or may not vote for it. But that would depend on what is finally handed to us.”

    Coble joins Sens. Lindsey Graham, R-S.C., Saxby Chambliss, R-Ga, and Rep. Peter King, R-NY, who have all said they’re willing to accept new ways to increase tax revenues in order to help prevent the fiscal crisis.

    Democrats like Rep. Mel Watt of Charlotte and G.K. Butterfield of Wilson said they’re open to reforming entitlements, including limiting Medicare benefits for wealthy Americans.

    “Seniors try to make you think that you will never change anything about Medicare,” Watt said. “I just think in order to save the program for middle income and poor people you might have to make substantial concessions.”

    Interviews with eight of the 15 Republican and Democratic members of the N.C. congressional delegation indicate that they are willing to negotiate on taxes and entitlement programs, including Social Security, Medicare and Medicaid. But they acknowledge negotiations will not be easy with politicians striving to maintain their favored federal programs or tax cuts.

    Going over the fiscal cliff could have devastating impacts. An N.C. family of four earning the state’s median income of $63,700 could see its income taxes rise $2,200, according to the White House. The President’s Council of Economic Advisers estimates that consumers in North Carolina would likely spend nearly $5.8 billion less in 2013.

    Sen. Kay Hagan, a Greensboro Democrat, said the problems have been studied multiple times, but now Democrats and Republicans must demonstrate the will to come to an agreement.

    “If we don’t act, every single family is going to see a tax increase and we have to prevent that,” Hagan said. The automatic cuts to the Defense Department alone would have “devastating” impacts on the state’s large military presence, she said.

    Other members like retiring Democratic Rep. Brad Miller of Raleigh question whether a compromise can be reached by the end of the year. He questioned the Republicans’ willingness to reform taxes and doubts Republican House leadership can convince the more hard-line tea party wing to accept any form of legitimate tax reform.

    Every current Republican member of the N.C. delegation has signed the Americans for Tax Reform pledge, including newcomers Reps.-elect Richard Hudson of Concord, Robert Pittenger of Charlotte, George Holding of Raleigh and Mark Meadows of Jackson County.

    Rep. Virginia Foxx of Banner Elk says the discussion should focus not on increasing tax rates, but instead on cutting spending. As secretary of the House Republican Conference, Foxx has been involved in strategy sessions with House Speaker John Boehner and House Majority Leader Eric Cantor.

    Asked if she felt beholden to the Americans For Tax Reform tax pledge, she answered that she felt beholden to cutting spending and not creating any new burdens on the American people.

    Several North Carolina Republicans who signed the pledge, including Rep. Patrick McHenry of Cherryville and Renee Ellmers of Dunn, declined to discuss the fiscal cliff as discussions continue. Sen. Richard Burr, a Winston-Salem Republican, also wouldn’t comment. Other representatives, including Reps. Sue Myrick of Charlotte and Larry Kissell of Biscoe, didn’t return calls requesting interviews.

    Butterfield and Watt said they don’t see how lawmakers can solve the country’s money problems without raising tax rates on the rich.

    Democratic Rep. David Price of Chapel Hill favors a plan that includes a balance of tax increases and spending cuts. He’s open to additional reforms of entitlement programs. But he argues any deal should take into account concessions Democrats have already made on discretionary spending cuts proposed by the deficit-reduction plan co-authored by Charlotte’s Erskine Bowles, a Democrat, and former GOP Sen. Alan Simpson of Wyoming.

    The 2010 Bowles-Simpson plan has been thrust into the spotlight again after failing to gain traction with Congress. It calls for reducing the federal debt by nearly $4 trillion through a three-to-one mix of spending cuts to tax revenue increases.

    There could be some benefits to going over the fiscal cliff, according to retiring Democratic Rep. Brad Miller of Raleigh and a growing corps of liberal Democrats.

    Miller sees the Norquist tax pledge as preventing some Republican House members from compromising on taxes. Going over the cliff would trigger automatic tax increases. Then, in the new year, Republicans could vote to cut taxes but leave them at a higher rate for wealthy Americans – thus not violating their pledge.

    “It bizarre reasoning that puts us in that position,” he said. “In a sane world, that really shouldn’t be a consideration. But we really don’t live with a sane Congress.”
    Most of the North Carolina delegation will have little to do with the high stakes negotiations.

    Watt said he wishes he was in the room cutting the deal. At some point, he and other members of the N.C. delegation will have to decide whether they can accept what agreements their leadership comes back with. Watt said he’s sure there will be some things that he won’t like, but he said that’s the nature of compromise.

    “We have a history of kind of producing when our backs are against the wall,” Watt said. “Our backs are certainly against the wall at this point so it’s time for us to produce.”
    Reach Franco Ordońez at fordonez@mcclatchydc.com

    http://www.star-telegram.com/2012/11/29/4446647/nc-congressional-delegation-will.html
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