Tuesday, December 13, 2011

Administration Defends Subsidies for Warren Buffett, Holds Out for Tax Hikes

Earlier this afternoon the White House released its Statement of Administration Policy regarding the House payroll tax bill being considered today.  Among other points, the SAP claims that the bill “giv[es] a free pass to the wealthiest and to big corporations by protecting their loopholes and subsidies.”

There are several problems with this highly questionable statement.  First, the House bill CUTS SUBSIDIES TO THE WEALTHY, by reducing taxpayer funding of wealthy beneficiaries’ Medicare premiums.  Second, a very similar version of this proposal was previously included in the President’s September deficit submission.  Republicans might logically assume therefore that the President thinks these subsidies for wealthy beneficiaries are unnecessary, and would support their reduction along the lines he previously outlined.  But apparently not.

There appear to be only three possible explanations for the White House’s new assertion that the payroll tax bill does not crack down on “loopholes” for the rich:

  • No one in the Administration has actually read the bill;
  • The Administration – in another shift from its September proposal – now believes that subsidizing Warren Buffett’s Medicare benefits is NOT a loophole, and wants to defend Medicare subsidies for millionaires and billionaires; or
  • Even though Republicans have offered to reduce subsidies for wealthy individuals in a manner the President previously said he supports, the Administration is adamantly holding out for tax increases – at a time when the economy remains in a deep economic slump.

The first two options are certainly possible, given past instances of not reading legislation and broken promises on health care.  But if it’s the latter, some would find it a bit rich that the Administration would lecture Republicans about “scoring political points” – when the same Administration is now rejecting its own proposal to reduce subsidies on millionaires and billionaires to pursue its ideological fixation on destructive tax increases.

Or, to put it another way, that’s not math.  That’s class warfare.