Republicans are up in arms about extending the Bush tax cuts for everyone, including those making over $250,000 per year, saying that failure to do so will result in a HUGE tax increase for working families, and the rich.
However, as the Center on Budget and Policy Priorities points out there are other Obama tax cuts that are set to expire that will result in HUGE tax increases on working families. Republicans have no interest in extending the Obama tax cuts. What are they?
Here is a summary from the Center: See http://www.offthechartsblog.org/
· Child Tax Credit expansion. The 2009 Recovery Act allowed low-income working families to count more of their earnings in calculating the value of their Child Tax Credit. If Congress doesn’t extend this provision, 10.7 million families will lose part or all of their child credit. For example, a single mother with two children who works full time, year round at the minimum wage and earns around $14,000 — someone who is trying to support her family through work rather than welfare — would see her child credit plummet by nearly $1,500, from $1,725 to $263 (see graph).
· EITC improvements for married couples and larger families. Some low-income working couples receive a smaller Earned Income Tax Credit if they marry than if they had remained single. The Recovery Act included marriage penalty relief that reduced this financial penalty by allowing married couples to receive somewhat larger EITC benefits. Families with nearly 5 million adults and more than 8 million children will be affected if this change expires.
· The Recovery Act also expanded EITC benefits for families with three or more children. Prior to 2009, these families — which make up a disproportionate share of all low-income working families — received the same EITC benefits as families with two children. The Recovery Act, by boosting EITC benefits for larger families, strengthened work incentives for more than 3 million low-income working families with children.
· Making Work Pay. Created in the Recovery Act, this tax credit reduces the amount the federal government withholds from the paychecks of more than 90 percent of working Americans; it’s worth up to $800 per couple. If Congress doesn’t extend it, working families would see their paychecks go down starting on January 1. For example, a nurse and a machinist who have two children and earn a combined $65,000 would have an extra $800 withheld from their paychecks over the course of 2011. (The tax bill that the House passed yesterday didn’t extend Making Work Pay, but it did extend the child credit and EITC improvements.)
Let’s see. Republicans are willing to shut down Congress to avoid millionaires from losing their tax cuts but these same Republicans are very willing to increase taxes on the middle class. Why am I not surprised?
Should we dump Obama?
Relatedly, it looks like Obama will cave on the whole matter of the Bush tax cuts. Republicans are set to get everything they want. They know Obama will not stand up to their threats. They know—and so do we—that Obama has no backbone. Maybe it is time for progressives to start thinking about dumping wimpy and running a true liberal/progressive in 2012. Think about it.