If you’re still holding out hope that perhaps the Obama administration is going to keep the Bush tax cuts, you can stop that now.Tim Geithner is making the administration’s views known pretty clearly.
Via POLITICO, here’s what he said on ABC’s This Week
“We also think it’s responsible to let the tax cuts expire that just go to 2 per cent to 3 per cent of Americans, the highest earning Americans. We think that’s the responsible thing to do because we need to make sure we can show the world that they’re willing as a country now to start to make some progress bringing down our long — our long-term deficits… I do not believe it will have a negative effect on growth.
This is interesting for a couple of different reasons. For one thing, by framing it as a deficit-reduction issue, he’s hoping to tap into a popular issue, and give the opposition a bit more of a challenge.
But beyond that, it’s fascinating when he talks about “showing the world” that we’ll do what it takes to address our long-term budget issues.
The actual tax hikes won’t make much of a dent, but it’s a signal. And apparently the man whose job it is to raise money for America feels this is a necessary signal to be sending.