(Washington, DC) Supporters of President Bush’s tax cut plan that would give massive tax breaks to millionaires were forced to take extraordinary measures in the Senate today to stave off total defeat. To secure passage of the budget resolution, the Senate leadership had to bring in Vice President Cheney to break a 50-50 tie vote, and Finance Committee Chairman Chuck Grassley of Iowa had to pledge on the Senate floor that the reconciliation conference report would not contain a tax cut greater than $350 billion. In a completely unprecedented move, the budget resolution has two different tax cut figures, with the House voting on a tax cut of $550 billion, down from $726 billion, while the Senate effectively established a tax cut cap of $350 billion.
Moderate Senators who voted for the resolution continued to voice their opposition to tax cuts that exceed $350 billion.
Leaders of the Fair Taxes for All Coalition called the gimmick Budget Resolution “absurd,” and cited the commitment to bring back a tax cut of no greater than $350 billion as further evidence that the Bush Administration does not have the votes to pass its gigantic tax cuts for the wealthiest Americans.
“The plan they barely got through the House in the dead of night yesterday only got out of the Senate on life support this afternoon,” said Nancy Duff Campbell, Co-President of the National Women’s Law Center, a Fair Taxes for All Coalition co-chair. “Support for the Administration’s tax cut plan continues to erode and the commitment to bring back a tax cut that doesn’t exceed $350 billion demonstrates the President’s plan to give enormous tax breaks to millionaires is unraveling.”
Today’s vote in the Senate is another in a growing list of setbacks for the Administration's reckless fiscal policies. Yesterday, the International Monetary Fund delivered a sharp rebuke of Bush’s tax plan, calling it “poorly timed and probably unnecessary…while failing to confront the looming costs of Medicare and Social Security.” [Wall Street Journal, 04/10/03] Earlier in the week, former Federal Reserve Chairman Paul Volcker, former Senators Warren Rudman, Sam Nunn, Bob Kerrey, and former Cabinet Secretaries Peter Peterson and Robert Rubin all came out and called the Bush tax cuts “ill-logical” and “not useful for short-term fiscal stimulus…nor would (the tax cuts) spur long-term economic growth.” [New York Times, 04/09/03]
The battle now moves on to the Senate Finance and House Ways and Means Committees, where Fair Taxes For All Coalition will fight to reduce the size of the tax cut, ensure that any tax changes are equitable and not skewed to the richest Americans, and that any growth package includes adequate state fiscal relief.
“With our nation at war, our economy lagging, and many states in fiscal crisis, we will fight any effort by Congress or the President to push tax breaks for millionaires that will explode the deficit and offer no stimulus to the economy,” said Roger Hickey of Campaign for America’s Future.
For more information, please visit the Fair Taxes for All Coalition’s website.