Obama Eyes $310 Billion Tax Cut

[formerlurker]

Obama Eyes $310 Billion Tax Cut Article

By JONATHAN WEISMAN and NAFTALI BENDAVID

WASHINGTON -- President-elect Barack Obama and congressional Democrats are crafting a plan to offer as much as $310 billion of tax cuts to individuals and businesses, a move aimed at attracting Republican support for an economic-stimulus package and prodding companies to create jobs.

The size of the proposed tax cuts -- which would account for about 40% of a stimulus package that could reach $775 billion over two years -- is greater than many on both sides of the aisle in Congress had anticipated, and may make it easier to win over Republicans who have stressed that any initiative should rely relatively heavily on tax cuts rather than spending.

The Obama tax-cut proposals, if enacted, could pack more punch in two years than either of President George W. Bush's tax cuts did in their first two years. Mr. Bush's 10-year, $1.35 trillion tax cut of 2001, considered the largest in history, contained $174 billion of cuts during its first two full years, according to Congress's Joint Committee on Taxation. The second-largest tax cut -- the 10-year, $350 billion package engineered by Mr. Bush's in 2003 -- contained $231 billion in 2004 and 2005.

The largest piece of the overall tax relief would involve cuts for people who pay income taxes or who claim the earned-income credit. It would serve as a down payment on the "Making Work Pay" proposal Mr. Obama outlined during his election campaign, providing a credit to offset Social Security and Medicare payroll taxes of $500 per individual or $1,000 per family.

http://online.wsj.com/article/SB123111279694652423.html?mod=testMod

[Jim]

same BS as from the campaign, loads more for "earned income tax credit" then shrinking as you go up.

his "stimulus plan" is nothing more than re-heated campaign platform crap.

none of it will help in the least but those are the only ideas they have.  the barrel is empty.

[NHSparky]

I was just gonna ask, who the hell is paying for all this?

[rich_t]

I was just gonna ask, who the hell is paying for all this?

You and I are.  The folks that actually work for a living.

[Schadenfreude]

Do you suppose his next step will be to cut spending? Naw, I didn't think so... 

[Baruch Menachem]

Does he actually want the economy to head into the tank?  I think he does, but I am willing to watch.  Tax cuts are in my view more stimulative.

Anyway, the big proposal is a bigger EIC.  That usually goes nowhere as an economic boost.  Lets see what he does with the Alternative Minimum tax and the capital gains rate.  I think if he lowered the capital  gains rate, he would get a lot more stimulative bang for his buck.