Several news outlets have uncritically quoted Republican senators criticizing the economic recovery plan supported by Senate Democrats as not being “timely, targeted and temporary” but did not point out that those Republicans voted in support of a proposed amendment by Sen. Jim DeMint (R-SC) that would replace the stimulus bill entirely with permanent tax cuts, some of which DeMint referred to as “broad based.”
Several news outlets have uncritically quoted Republican senators criticizing the economic recovery plan supported by Senate Democrats as not being “timely, targeted and temporary” but did not point out that those Republicans voted in support 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 referred to as “broad based.”
In February 7 articles, both The New York Times and Congressional Quarterly Weekly (accessed via Nexis) uncritically quoted Senate Republican leader Mitch McConnell (KY) saying of the economic recovery package: “A bill that was meant to be timely, targeted and temporary has instead become a Trojan horse for pet projects and expanded government.” Similarly, on February 5, The Associated Press reported that Sen. John Thune (R-SD) “says a package that was supposed to be timely, targeted and temporary will put too much of a burden on future generations as it's based on borrowed money.” However, none of these articles noted that the Republican senators quoted actually voted in support of DeMint's proposal, which is neither “temporary” nor “targeted.”
DeMint's proposal was not “temporary.” It included provisions making 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.
o Permanently repeal the alternative minimum tax once and for all;
o Permanently keep the capital gains and dividends taxes at 15 percent;
o Permanently kill the Death Tax for estates under $5 million, and cut the tax rate to 15 percent for those above;
o Permanently extend the $1,000-per-child tax credit;
o Permanently repeal the marriage tax penalty;
o Permanently simplify itemized deductions to include only home mortgage interest and charitable contributions.
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.
o Lower top marginal income rates - the one paid by most of the small businesses that create new jobs - from 35 percent to 25 percent.
o Simplify the tax code to include only two other brackets, 15 and 10 percent.
o 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.
Indeed, 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:
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.
DeMint also criticized “targeted tax benefits” for corporations in the Democratic bill, saying that they “only encourage” those companies to “spend money on the lobbyists who secure such goodies” :
And rather than giving large companies loopholes and targeted tax benefits -- which only encourage them to spend money on the lobbyists who secure such goodies -- Congress should get out of the business of picking winners and losers in the market and simply cut everyone's taxes and let the best company win. My plan will make businesses compete for consumers, not Congressmen.
From The New York Times' February 7 article, “Divisions Over the Competing Stimulus Bills” by David M. Herszenhorn:
In debate on the Senate floor, many Republicans, including the party's defeated presidential nominee, Senator John McCain of Arizona, offered amendments to reduce spending and broaden the tax cuts in the plan. The Democrats easily swatted those down.
Critics of the stimulus plan say Democrats have packed it not with the most effective short-term proposals to lift the economy, but with favored, liberal spending programs that will drastically increase the national debt and cause long-term fiscal harm.
“A bill that was meant to be timely, targeted and temporary has instead become a Trojan horse for pet projects and expanded government,” the Republican leader, Senator Mitch McConnell, said in a floor speech on Friday.
House and Senate leaders hope to begin negotiations on the stimulus measure this week with a goal of sending a final product to Obama before the Presidents Day weekend.
But no House Republican voted for the bill when it passed that chamber, and GOP support seemed almost as slim in the Senate. Republicans, including 2008 GOP presidential nominee John McCain of Arizona and Minority Leader Mitch McConnell of Kentucky, protested that even the slimmer compromise was too costly, and said public opinion was turning against the proposal.
“The more the American people learn about this bill, the less they like it,” McConnell said. “Americans realize that a bill which was meant to be timely, targeted and temporary has instead become a Trojan horse for pet projects and expanded government.”
From the AP's February 5 article, “Thune Calls Stimulus Bill Unfocused, Unending” :
Sen. John Thune says President Obama's nearly $1 trillion economic stimulus plan is laden with extraneous spending on pet projects that won't stimulate the economy.
He says he'll vote against the bill unless it's significantly modified.
The South Dakota Republican says a package that was supposed to be timely, targeted and temporary will put too much of a burden on future generations as it's based on borrowed money.
Thune is pushing for more tax breaks for middle-class families and small businesses and incentives for small business to create jobs.