Republicans Want More Tax Cuts In Stimulus Plan

By Alan Stewart Carl | Related entries in Congress, Economy, Republicans

In a last-ditch effort to influence the stimulus package, Republicans have proposed an alternate bill focused predominately on tax cuts.

“If government spending was going to get us out of this mess, we’d have been out a long time ago, because that’s all we’ve been doing,” said Rep. Jim Jordan, R-Ohio. “This is not going to work. That’s why we’ve got a bill we think will work.”

Their bill, called the Economic Recovery and Middle-Class Tax Relief Act of 2009, promises a host of tax-cutting measures. It includes a 5 percent “across the board” income tax cut; an increase in the child tax credit from $1,000 to $5,000; a freeze on capital gains and dividends tax rates at 15 percent; and a number of other measures targeted toward businesses.

While the Democratic version of the bill is expected to pass the House today, the Republican initiatives are worth considering. I don’t think tax cuts alone are going to be any more effective than spending alone would be, but such measures as increasing the child tax credit and freezing capital gains taxes at 15% are solid ideas. The child credit will help families weather the recession while keeping capital gains taxes low will ensure businesses can reinvest their money and move us more quickly toward recovery.

The problem for Republicans is that it’s really easy for any broad tax cutting to be labeled a tax cut for the rich. If you pay more taxes, you’ll get more immediate benefit. Republicans have yet to create innovative tax solutions to America’s problems and are stuck recycling the same worn ideas. Even when those ideas are on-target, it’s easy to dismiss them as out-of-date.

Perhaps Democrats will listen to Republican ideas as the stimulus moves towards passage. The bill could use a more even balance between spending and tax relief. But if Republican ideas fail to find a place in the stimulus plan, Republicans can blame themselves for having, from the beginning, an unfocused response to the economic crisis. Their ideas failed them in the election and it will not be surprising if they fail them here in the early moments of the Obama presidency.


This entry was posted on Wednesday, January 28th, 2009 and is filed under Congress, Economy, Republicans. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

5 Responses to “Republicans Want More Tax Cuts In Stimulus Plan”

  1. Togakangaroo Says:

    Jeez, close link tags much?

  2. ExiledIndependent Says:

    Sad but true post, Allan. People right now don’t want to hear about the fundamentals of economics (because they’re scary, don’t reward/drive towards social equality, etc.), they want to believe in a man who, much like Santa Claus, promises wonderful presents to all good girls and boys. These spending bills are setting us up for at best a massive economic collapse and, at worst, World War 3 when China invades the Ukraine.

  3. BenG Says:

    Exiled Indi.

    That’s truly crazy talk, but thanks for expressing the crux of my next point which is, in a few simple words, some things never change!

    So what have the Repubs done during the previous 10 years but, as you so well put it, “Setting us up for at best a massive economic collapse and, at worst, WW 3…” And, again, thanks so much for including the wreck the Bush folks made of our foreign diplomacy as well as our economy in one short quote.

    Do you really think Obama planned on doing this kind of Gov. spending a year ago if he was to become Pres.? He’s showed good signs of what he wanted to do to curb excess spending and make the Gov more focused on the public good. These measures he’s promoting are obviously desperate attempts to rescue a disastrous but inherited economic situation.

    Oh, and I agree with the original post – Repubs need a new mantra other than “Lower taxes, cut capitol gains, lower the top tax rate, bla, bla, bla. Of course we need lower taxes. Nobody wants to pay taxes, but fix the Government first, making it lean and efficient, and then you can fix the tax rate. Yea, I know, then pigs will fly.

  4. Jim S Says:

    The Republicans have no proposals for anything besides tax cuts. Tax cuts are their only answer to everything. And tax cuts like they want are not inherently better than public spending in order to stimulate the economy or provide jobs. I’m tired of the false claims that if you just give the wealthy tax cuts they’ll invest it in enterprises providing American jobs. Corporations have no real interest in employing Americans. Any money that they get is just as likely to go overseas. The same thing applies to where investments by wealthy individuals might wind up. If the idea is to help the United States, spending on projects that must be done by Americans in the U.S. is more likely to help no matter what conservative ideologues claim.

  5. Jerome Byanski Says:

    Scared I am.

    If placed in charge of this enormous task, I would solcit a list of 10 stimulous projects/ideas/proposals from the Governors of each of our 50 states.

    That would create a combined list of 500 items. I would then cross reference the list, rank accordingly and produce a stimulous plan based on the folks who walk the walk and talk the talk.

    At least it would be from a solid foundation and worthy of great merit.

    I do not trust the folks in DC to shovel my walk.

    Look to the States!!!!!

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