Skip to comments.White House: Threat of tax hikes could hurt holiday shopping (Bush tax cuts ok for now)
Posted on 11/26/2012 5:26:59 AM PST by Libloather
White House: Threat of tax hikes could hurt holiday shopping
By Justin Sink - 11/26/12 06:00 AM ET
The White House released a report Monday arguing that a failure to extend tax cuts for middle class families could have a negative impact on the economy which outweighs the gains from traditional Black Friday and Cyber Monday holiday sales.
According to the report, reverting back to pre-Bush era tax rates would reduce consumer spending some $200 billion four times the amount holiday shoppers spent on Black Friday weekend in 2011.
"As we approach the holiday season, which accounts for close to one-fifth of industry sales, retailers cant afford the threat of tax increases on middle-class families," the White House said in an e-mail Monday.
The new report comes as lawmakers return to Washington this week to begin negotiating a deal to avoid the looming fiscal cliff.
If lawmakers are unable to strike a deal before the end of the calendar year, taxes will increase across the board while dramatic social and defense spending cuts will be automatically triggered.
The report, issued by the National Economic Council and the Council of Economic Advisers, argues congressional Republicans should immediately extend tax cuts for all but the wealthiest Americans.
"The typical middle-class family will see their taxes go up by $2,200 next year, negatively impacting businesses and retailers across the nation," said the statement. "The President has called on Congress to take action and stop holding the middle class and our economy hostage over a disagreement on tax cuts for households with incomes over $250,000 per year."
But Republican lawmakers have objected to a deal that would raise the tax rate for the wealthiest Americans, arguing that doing so would stifle job growth. Moreover, Republicans want President Obama to agree to significant budget cuts and entitlement reforms as part of an overall debt package.
During appearances on the Sunday talk shows, top legislators on both sides of the aisle signaled the dire consequences that would result from failing to strike a bargain.
"The election's over," Rep. Peter King (R-N.Y.) said on NBC's "Meet the Press" Sunday. "We have to show the world we're adults."
Some Republicans, including Sens. Saxby Chambliss (Ga.) and Lindsey Graham (S.C.) have also said they would be willing to violate the Americans for Tax Reform anti-tax pledge if Democrats counter with significant entitlement reforms.
"So I agree with Grover, we shouldn't raise rates. But, I think Grover is wrong when it comes to [saying] we can't cap deductions and buy down debt," Graham told ABC News. "I want to buy down debt and cut rates to create jobs, but I will violate the pledge, long story short, for the good of the country, only if Democrats will do entitlement reform."
Meanwhile, the White House hopes to ramp up pressure on Republicans with the release of the report on Cyber Monday, the online equivalent to the traditional Black Friday retail sales. It's the latest push from President Obama, who last week blasted his campaign e-mail list with a plea to supporters urging them to contact their elected officials in support of the president's plan.
"We shouldnt hold the middle class hostage while Congress debates tax cuts for the wealthy," the president said in his weekly address. "Lets begin our work by actually doing what we all agree on. Lets keep taxes low for the middle class. And lets get it done soon so we can give families and businesses some good news going into the holiday season."
Any tax increases should be across the board, period. I would push that agenda and see how far Barky is willing to go. One more thing, I’d push to get rid of that inane earned income credit, it is nothing but a augmentation of the minimum wage paid through the tax system. A billion here a billion there, before you know it we would be talking real money.
This is not meant to suggest tax increases are going to solve the federal deficit, they MUST begin to roll back the federal largess....all programs....and eliminate the fluff like cell phones and the like.
So now the democrats are upset that the Bush TAX CUTS FOR THE MIDDLE CLASS will expire?
How ‘bout that.
Sadly, I'm not in a position to take that attitude because I, like most of you here on FR, will also be going down with Husein's and his regime.
Obama voters voted for economic depression.
At this point, I'm ready for a pyrrhic victory.
Only a total idiot or Keynesian (but I repeat myself) could possibly think that spending and consumption produces prosperity and growth. Rather than just the short appearance thereof.
I know I wont like whatever the Republicans will agree to.
My idea is to play the same type of cynical political game that Dems are. Question : Did Pelosi get the blame when the economy crashed in 2007 to 2008??
Of course not because Dems played it right.
If nothing is done then all those taxe rates go up, rates, dividends, etc, and some automatic spending cuts go into effect. These require NO votes to happen.
Very simple plan, House Republicans appear to cave to Obama by extending just some of the tax cuts, instead of $250K make the threshold 100K and let all the spending cuts go into effect at the same time. That will head off the 'taxing the middle class to protect the rich' charge while at the same time not breaking any pledges or voting to increase any taxes.
Then make sure Obama owns it. Go on all the TV shows and say that O raised those taxes because he won the election. Then you got a issue for 2016 or maybe even 2014.
Republicans being outsmarted by O is getting old.
At tax time, Young Women With Bastards (Obama constituency group) receive some $3,000-5,000 as a "refund" on their taxes.
I've observed that many of these checks are used to purchase crappy cars.
This sounds like satire.
Let all the Bush tax cuts expire. The nation still laughably still blames him for the bad economy anyway, so let that part of his legacy die off.
No complaining, America. You wanted this.
Me too. American voters need to learn the up-close-and-personal lesson of "elections have consequences."
Bush’s fault and unexpectedly of course.
Morons appealing to morons!
So, if you have enough money to blow on Christmas shopping....it’s Bush’s fault
The highest bidder does that for them.
Id push to get rid of that inane earned income credit, it is nothing but a augmentation of the minimum wage paid through the tax system.Dito that.
Plus the EIC is a Dem vote buying scam. It's nothing but a de facto welfare gimmick -- The more 'children' you can claim the bigger the 'earned income credit' you receive.
Some illegals who use a Tax Number to file have been caught claiming as many as twenty 'children' or more. Some of whom didn't exist or who lived back in Mexico and weren't even their children like nieces and nephews. The 'refunds' were in five figures: $20,000-$30,000.
I thought all the tax cuts were for the rich. obama is a lying sack of crap and he makes me physically sick.
And they get away with it election after election.
Push the whole “tax cuts for the rich” meme before the election, but NOW? Oh no! We can’t let those tax cuts expire!
Every day middle class americans will cut back on Christmas shopping!
The reported crowds at the retail stores would seem counter to this. Probably a whole lot of people spending their "Obama won and I'm happy" money. That or they figure Obama will bailed them out somehow.
What middle class tax hikes? Obama and the Democraps all said they were “Bush tax cuts for the rich.”