Members of the Congressional Black Caucus (CBC) announced Friday that an “overwhelming majority” of the 41-member caucus opposes President Obama’s compromise plan with Republicans to extend the Bush-era tax rates.
“Any extension of the Bush-era tax cuts for the wealthiest Americans is just a non-starter,” said Virginia Democratic Rep. Robert Scott, a CBC member.
Caucus members said they have the strongest reservations about Obama’s agreement to extend current tax rates for households earning more than $250,000 annually and the proposal to set the estate tax at 35 percent for assets worth beyond $5 million. CBC Chairman Barbara Lee of California said the plan could place an unfair burden on the working class to reduce the national deficit.
“We are extremely concerned that the cuts that could be made should this package pass would disproportionally hurt the poor and low income communities and further erode the safety net,” she said.
The group plans to release its own proposal to raise taxes on the wealthy, which they said would cost half of the estimated $858 billion price tag of the original plan. In part, the CBC proposal would extend unemployment benefits, guarantee that Social Security funding will not be reduced and includes a two-year extension of the tax rates for households earning less than $250,000 annually.
“You can’t give everybody a tax cut like it’s Oprah Winfrey or Santa Claus: ‘You get a tax cut, you get a tax cut.’ Eventually, somebody’s going to have to pay for it,” said Scott.
Beyond the deficit concerns, CBC members said they were worried that this would be “the first step” in a Republican-led effort to defund government programs, especially the health care overhaul.
“This just gives our Republican colleagues another chance to play ‘Gotcha,'” said CBC member Donna Christensen, a delegate from the Virgin Islands. “If we extend the upper end tax cuts and add that big estate tax giveaway, then when we move to fun implementation of the Affordable Care Act, there will be no money. Gotcha.”
There were also worries that this could be the last chance Democrats would have to raise taxes for years.
“We have already established the principle that failure to extend the tax cut constitutes a tax increase. And if we can’t cut them off now, what is the chance that we’re going to be able to increase taxes in the middle of a presidential congressional election?” Scott asked. “The Tea Party will be intimidating all the Republicans into getting in line to make these things permanent.”
House Democrats this week agreed to a non-binding resolution to oppose Obama’s plan, which is likely to be voted on in the Senate next week. Lee said that a majority of the CBC “would not vote for it” if the current proposal were brought to the House floor today, adding that “there are a variety of legislative strategies and options that we’re considering.”
“At this point we don’t know exactly how this will play out,” she said.