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  • New Deal on Bush tax cuts reached............

    bama reaches deal with Republicans over tax cuts
    US President Barack Obama Mr Obama said there were elements of the deal that he opposed




    US President Barack Obama has announced a bipartisan agreement has been reached to extend soon-to-expire Bush era tax cuts to all Americans.

    Referring to the bitter wrangling over the issue, Mr Obama said he would not "let working families become collateral damage for political warfare".

    Some Democrats have said the deal, which must be voted on by Congress, is too generous to the wealthy.

    Unemployment benefits will also be renewed under the agreement.

    The BBC's Steve Kingstone, in Washington, says the deal represents a climb-down by President Obama.

    It marks a reversal of his position, first laid out in his 2008 campaign, that tax cuts should only be extended at incomes up to $200,000 for individuals and $250,000 for couples.

    Following November's mid-term elections, Republicans took control of the House of Representatives and increased their power in the Senate.

    Mr Obama's announcement came two days after the US Senate rejected President Obama's preferred tax plan.

    Elements of the framework deal include:

    * A two-year extension of income tax cuts for all Americans enacted in 2001 and 2003 under former President Bush
    * A 13-month extension of unemployment benefits for the long-term unemployed
    * A 35% tax for two years on estates worth more than $5m
    * A Social Security tax cut that would see the tax drop from 6.2% of pay to 4.2% for one year
    * Allowing businesses to write off all their capital investments for tax purposes during 2011
    * Extending the Earned Income Tax Credit, the child tax credit and tuition credits

    'Grave injustice'

    Mr Obama said there were elements of the deal that he opposed - including an extension of tax cuts for the wealthiest 2% of Americans.

    But he said striking a deal with Republicans was more important than allowing the tax cuts to expire on 1 January 2011 amid a political stalemate.


    By any definition, this agreement represents a climb-down by Mr Obama, and it reflects the new reality in the American Congress.

    Opposition Republicans made significant gains in the mid-term elections, and they will increasingly call the shots. The U-turn will dismay some of the president's core supporters on the Left.

    And tellingly, it is Democratic lawmakers - Mr Obama's own side - who are saying this deal is not yet final.

    He said it would be a "grave injustice to let taxes increase" for ordinary Americans.

    "Make no mistake, allowing taxes to go up on all Americans would have raised taxes by $3,000 for a typical American family and that could cost our economy well over a million jobs," he said at the White House.

    Republicans praised the president's decision following the press conference on Monday night.

    "I appreciate the determined efforts of the president and vice president in working with Republicans on a bipartisan plan to prevent a tax hike on any American and in creating incentives for economic growth," said the Republican leader in the senate, Mitch McConnell.

    Mr Obama's announcement at the White House on Monday was held shortly after the president's return from a trip to North Carolina, where he said Congress must "make sure we're coming up with a solution, even if it's not 100% what I want or 100% what the Republicans want".

    It also came a week after the government reported that joblessness in the US had risen in November to 9.8%.

    With the agreement on tax cuts finalised, analysts say Congress may now focus its attention on holding a debate over whether to ratify the New Start Treaty, which seeks to reduce the nuclear arsenals of both the US and Russia and allow each to inspect the other's facilities.


    BBC News - Obama reaches deal with Republicans over tax cuts
    "They want to test our feelings.They want to know whether Muslims are extremists or not. Death to them and their newspapers."

    Protester

  • #2
    * A 13-month extension of unemployment benefits for the long-term unemployed
    that's the one thing that doesn't make sense to me.
    Meddle not in the affairs of dragons, for you are crunchy and taste good with ketchup.

    Abusing Yellow is meant to be a labor of love, not something you sell to the highest bidder.

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    • #3
      Originally posted by bigross86 View Post
      that's the one thing that doesn't make sense to me.
      Republican's caving to get a minor concession.

      -dale

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      • #4
        A minor concession? This seems a pretty big concession on Obama's part, especially considering how anti-tax cuts he's been until now
        Meddle not in the affairs of dragons, for you are crunchy and taste good with ketchup.

        Abusing Yellow is meant to be a labor of love, not something you sell to the highest bidder.

        Comment


        • #5
          Originally posted by bigross86 View Post
          A minor concession? This seems a pretty big concession on Obama's part, especially considering how anti-tax cuts he's been until now
          Not raising taxes for the wealthy is a big concession for the Democrats.

          I have mixed feelings about the continuation of unemployment benefits. I feel those drawing the benefits have stopped looking for work. On the other hand, there are still thousands of construction workers (building new homes) out of work, since the mortgage crisis. In my area (in the South), lots of the construction workers went to landscaping, but were again layed off when the summer ended. It's a vicious circle, and they have families to feed. For that reason, I'm inclined to say the extension of unemployment benefits are justifiable.

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          • #6
            it also represents the most efficient and effective part of the economic package: it has approximately 5x more bang for the buck in a recessionary environment.

            i would have substituted a return to clinton level tax rates for the wealthy in return for the unemployment benefits, as well as corporate and capital gains tax cuts.

            from a political standpoint, the reps pretty much beat the dems silly on this one.
            There is a cult of ignorance in the United States, and there has always been. The strain of anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that "My ignorance is just as good as your knowledge."- Isaac Asimov

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            • #7
              Obama is finished. There is no way that his base will support him for the 2012. I am a Republican and do not like any increase in taxes but this latest capitulation shows what an ineffectual leader Obama is. I supported Obama all the way until this. He failed to get any major concessions out of this that would salvage his support among his base.

              No way Obama wins anything out of this. He is now a lame duck President.

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              • #8
                If we change the "unemployment entitlement" to "government contractor" then our unemployment rate will drop to near zero overnight. They are doing work like finding work and going to school for the government. They certainly don't enjoy it, but getting paid at the same time. That's a classic definition of "work."

                Come on, my fellow democrats. Let's work together to lower our unemployment rate to near zero.
                "Only Nixon can go to China." -- Old Vulcan proverb.

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                • #9
                  Originally posted by gunnut View Post
                  If we change the "unemployment entitlement" to "government contractor" then our unemployment rate will drop to near zero overnight. They are doing work like finding work and going to school for the government. They certainly don't enjoy it, but getting paid at the same time. That's a classic definition of "work."

                  Come on, my fellow democrats. Let's work together to lower our unemployment rate to near zero.
                  Obama is brain dead, the tax rates are now set to increase timed to the 2012 elections, he didn't use his leverage to include DADT (to appease his base) and he cut Harry reid off at the knees. Pelosi is the Left's only hope now. She can do what the Republicans did in the senate and draw a line in the sand. In fact I expect her to, she is evil but not stupid.

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                  • #10
                    That Estate Tax issue....does anyone here think more than 35% tax is excessive? Why should the government receive more than 1/3 of my inheritance?

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                    • #11
                      Originally posted by Julie View Post
                      That Estate Tax issue....does anyone here think more than 35% tax is excessive? Why should the government receive more than 1/3 of my inheritance?

                      Its 35% after the first 5 million in assets. Its also easily avoided through the creation of trusts. Honestly anyone who dies with that much money left for the government is stupid and lucky. Old age diseases can do more damage to what they wanted to leave thier family than the government can in most cases. If you have assets that can be taxed when you die put it in trust or some other shelter.

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                      • #12
                        I believe unemployment needs to be based on need, in a two income family, where they live in a mcmansion with two new cars and a yacht, why are we subsidizing this? On the other hand a single income family with kids living in an appartment or modest home and within their means, it could mean the difference between a life and homelessness. I don't think unemployment should be used for vacations or luxuries, it is intended as a safety net for lower income families, not suplementary enrichment for the well off. I don't think a household with an income of over 100K should get any unemployment benifits.
                        sigpic"If your plan is for one year, plant rice. If your plan is for ten years, plant trees.
                        If your plan is for one hundred years, educate children."

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                        • #13
                          Originally posted by zraver View Post
                          Its 35% after the first 5 million in assets. Its also easily avoided through the creation of trusts. Honestly anyone who dies with that much money left for the government is stupid and lucky. Old age diseases can do more damage to what they wanted to leave thier family than the government can in most cases. If you have assets that can be taxed when you die put it in trust or some other shelter.
                          All trusts gets taxed in one way or the other. You can avoid the big bite if you transfer assets in their early stages to the trust before they begin to accrue their value, then the tax you have to pay will be small in the beginning. But trusts and shelters are still require to pay the capital gains tax, just under a different tax ID.

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                          • #14
                            Cry all you want about extending unemployment. You have to support the unemployed or, EGADS, give them a job, and no one has shown a willingness to do that. Giving concessions to business and hoping they will hire is foolish, naive and down right insane.

                            If I were president my "compromise" would have been to businesses. "The more people they hire at a decent wage, the lower their taxes." We have already seen that businesses can be awash with cash and still they will not hire so just giving them lower taxes is no incentive for them to hire. All the money goes to and stays at the people at the top. and that is not doing the economy any good.
                            Removing a single turd from the cesspool doesn't make any difference.

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                            • #15
                              Originally posted by Julie View Post
                              Not raising taxes for the wealthy is a big concession for the Democrats.

                              I have mixed feelings about the continuation of unemployment benefits. I feel those drawing the benefits have stopped looking for work. On the other hand, there are still thousands of construction workers (building new homes) out of work, since the mortgage crisis. In my area (in the South), lots of the construction workers went to landscaping, but were again layed off when the summer ended. It's a vicious circle, and they have families to feed. For that reason, I'm inclined to say the extension of unemployment benefits are justifiable.
                              The democrats are not "raising taxes" They were ending the subsidies, ie tax cuts that were due to expire. Put some jobs on the market and those who want to work will find them. No jobs...why bother looking. It is the people that are on welfare even when the economy is rolling that we need to scrutinize more and bump them if do not get their act together.
                              Removing a single turd from the cesspool doesn't make any difference.

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