Tales from the Trail

Democrats in a dilemma on Bush tax cuts

July 15, 2010

Conventional political wisdom says that if you are going to cut taxes, do it before an election. But in a congressional election year when record deficits and a $13 trillion national debt are unnerving voters, that wisdom may not hold.

USA/At least that seems to be the case among Democrats who are facing serious voter concerns about deficits, the fragile economy and lack of job creation going into the November elections when Republicans hope to take control of Congress.

President George W. Bush’s tax cuts expire at the end of the year. Republicans want to extend all of the tax cuts. Democrats want to extend lower tax rates for middle income earners at least through 2011 and allow tax cuts for wealthier taxpayers to expire.

The question Democrats are debating is when to take up the tax cuts — before or after the November election. House Speaker Nancy Pelosi was asked about that at her weekly press conference, but she declined to offer any insight.

“I’m not going to make any announcements today (about) what we will be taking up in terms of timing, but we will be taking them up,” she said.

A tax cut bill could quickly pass the House of Representatives. But it would be much harder to speed one through the Senate where Republicans have successfully thrown up roadblocks against a number of Democratic initiatives.

The dilemma facing Democrats as they debate the timing of tax cut legislation is how it will play out in an election year when voters are so worried about the $1.4 trillion deficit. Democrats are taking a lot of heat on the deficit and may not get that much voter credit for extending Bush’s tax cuts.

Dana Perino, who was Bush’s White House press secretary, offered this suggestion to help out Democrats on Politico:  “Let’s let the Democrats rename a package of tax cuts that does extend the cuts and allow them to save face.”

Photo credit:  REUTERS/Kevin Lamarque (House Speaker Nancy Pelosi, House Democratic Leader Steny Hoyer and Senate Democratic Leader Harry Reid at the White House)

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