Right now it sounds as though either all tax cuts will be extended, or only the middle class tax cuts will be extended, with those for the rich being let to expire.
But why must it be this way?
How about we extend the tax cuts for the rich, but keep them for the middle class?
It sounds unfair, but if you read between the lines of Newt Gingrich’s appearance on Fox News Sunday this weekend, it sounds like the GOP thought leader might be open to it.
WALLACE: So you’re saying, in effect, that when the president tried to set up this as a choice, they’re trying to hold the tax cuts for the middle class hostage, Republicans are going to say, “Not us. We’ll take whatever we can get.”
GINGRICH: Yeah. I think Republicans ought to say, “We’re going to pass any tax cut that you’ll sign that has no increases. And we’ll come back in January as a majority and we’ll see if we can pass the rest.”
WALLACE: But you’re, in effect, saying that at least until you — if and when you gain control of Congress, you’re giving up on the tax cut for the wealthy.
GINGRICH: No, you — you’re saying that the president of the United States is determined to stop the tax increases on people who create jobs. He is the president. It’s better to at least help the middle class even if that doesn’t create jobs.
So basically, Gingrich is saying that the main motivation of the tax choice should be job creation, and that only tax cuts for the rich help accomplish this. Tax cuts for the middle class won’t do much, except “help.”
Of course, this is basically the old supply side vs. demand side debate. Gingrich thinks that by stimulating the supply side (the creators of wealth), jobs will come. Critics would say that the way to creating jobs is to increase demand (thus, lower middle class taxes).
Critics of the Gingrich theory would also point out that corporations are largely cash flush right now, and see little reason to spend their money? So what would a tax cut do for them?
Anyway, here’s the video.
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