Returning to the Bush Tax Cuts

Former President George W. Bush’s tax cuts expire in January, and Democrats and Republicans both have committed to extending some, if not all, of the cuts. Obama and the Democrats are behind keeping cuts that benefit middle class families — they want to reduce taxes for families making less than $250,000 a year, keep the estate tax stable and continue the freeze on the alternative minimum tax. If those measures were extended for two years, the cost would be around $250 billion. If all the tax cuts and freezes expired, the government would raise $3.7 trillion over 10 years.

But the Senate cannot take the extension of the tax cuts up due to overcrowding on the calendar — it is dealing with the unemployment extension, financial regulatory reform and a host of other bills. For that, Sen. Harry Reid (D-Nev.) hit at the GOP yesterday: “Maybe if they stop stalling everything that comes to the floor we might be able to get to that stuff. We’ll get to that when we get through unemployment insurance, Wall Street reform, and a few other things.”

Democrats would like to “get to that,” but some senators are starting to predict, given the bottleneck in the Senate and the politics of raising taxes on anyone, that won’t happen until after the election.