By Sam Klein
President Barack Obama will try his luck with his new deficit reduction proposal to Congress, which is projected to cut roughly $3 trillion dollars over ten years. Half of the expected reduction will be derived from increased taxes.
Obama’s fourth try at a deficit reduction package does not look promising though, as analysts project a strong Republican disapproval. Republicans in general are most opposed to increasing taxes, especially now. “It’s a bad thing to do in the middle of an economic downturn,” Mitch McConnell says, Senate Minority Leader says.
Yet, Obama is trying to compromise; over $300 billion dollars will be cut from Democrat-supported programs over ten years, which will include major cuts to Medicaid and Medicare. Obama did comment, however, saying that he will veto any bill that reduces Medicare and Medicaid, without increasing taxes on the wealthy.
Most of Obama’s proposed tax cuts will be derived from the expiration of the Bush-era-tax cuts ($800 billion) which will increase the taxes on families making more than $250,000 a year. The total saving will roughly come out to be $1.5 trillion dollars, yet Republican House Budget Committee Chairman, Paul Ryan, states that, “If you tax job creators more, you get less job creation.”
Thus, Congress will have a lot on its plate in the next few weeks, as they determine the best possible route to take for our nation’s economy. Obama certainly proposes drastic cuts and savings, which seem to suggest he is ready for bi-partisan compromise, but will these savings be enough? Yet, the bigger question may be: Can any bill be passed in a Congress so divided?