Bloomberg uncritically quoted Sen. Mitch McConnell criticizing the economic recovery plan as being neither "timely, targeted nor temporary," but did not point out that McConnell voted in support of a proposed amendment by Sen. Jim DeMint that would replace the recovery bill entirely with permanent tax cuts, some of which DeMint has called "broad based."
A February 12 Bloomberg article uncritically quoted Sen. Mitch McConnell (R-KY) saying of the economic recovery package: "This unprecedented spending of taxpayer dollars is not timely, targeted nor temporary and it fails to address the underlying problems with the economy." But the article did not point out that McConnell voted in favor of a proposed amendment by Sen. Jim DeMint (R-SC) that would replace the recovery bill entirely with permanent tax cuts, some of which DeMint has referred to as "broad based."
As Media Matters for America noted, DeMint's proposal is neither "targeted nor temporary." For example, it included provisions making former President Bush's 2001 and 2003 tax cuts permanent; indeed, in a January 29 speech at the Heritage Foundation, DeMint said of his plan: "The idea is simple: first, make the temporary tax cuts of 2001 and 2003 -- now set to expire in 2011 -- permanent." From DeMint's summary of his proposal:
1) Defuse the 2011 tax bomb: Stop tax increases set to hit the economy in 2011
- Permanently repeal the alternative minimum tax once and for all;
- Permanently keep the capital gains and dividends taxes at 15 percent;
- Permanently kill the Death Tax for estates under $5 million, and cut the tax rate to 15 percent for those above;
- Permanently extend the $1,000-per-child tax credit;
- Permanently repeal the marriage tax penalty;
- Permanently simplify itemized deductions to include only home mortgage interest and charitable contributions.
Additionally, other permanent tax cuts included in DeMint's amendment are, by DeMint's own admission, not "targeted." According to DeMint, these tax cuts are formulated to both last over the "long term" and be applied "broad[ly]." These proposals include:
2) Long term, broad based tax cuts for American families and businesses
- Lower top marginal income rates -- the one paid by most of the small businesses that create new jobs - from 35 percent to 25 percent.
- Simplify the tax code to include only two other brackets, 15 and 10 percent.
- Lower corporate tax rate as well, from 35 percent to 25 percent. The U.S. corporate tax rate is second highest among all industrialized nations, driving investment and jobs overseas. Lowering this key rate will unlock trillions of dollars to be invested in America instead of abroad.
Furthermore, during his January 29 speech, DeMint specifically criticized "targeted" and "temporary" tax cuts in contrasting the Democratic proposal with his own. DeMint said of the Democratic recovery bill:
DeMINT: The tax side of the bill is little better. Think of it this way: if nearly every Democrat in Congress supports a tax cut, it's not really a tax cut. And, indeed, the text of the Democrats' plan reveals $212 billion of smoke-and-mirrors gimmicks: temporary cuts and rebates exactly like those that failed to stimulate the economy last year, and eco-shakedown tax credits.
From the February 12 Bloomberg article:
White House aides involved in the compromise talks included Chief of Staff Rahm Emanuel, Budget Director Peter Orszag and Deputy Budget Director Rob Nabors.
Senator Susan Collins of Maine, one of the three Republicans whose support was needed to pass the Senate's stimulus bill, hailed the cuts made to produce the $789 billion plan. She said the measure "reflects our efforts to truly focus this bill on programs and policies and tax relief that will help turn our economy around."
Senate Minority Leader Mitch McConnell, a Kentucky Republican, said in a statement he saw little in the compromise to change his opinion that the plan remains fundamentally flawed.
"It still misses the mark," he said. "'This unprecedented spending of taxpayer dollars is not timely, targeted nor temporary and it fails to address the underlying problems with the economy. American families know they have a limit on spending their hard-earned money but now they must be wondering if the government has any limits on spending it for them."