Is the GOP risking America's future to protect millionaires and oil companies?

From the Talking Points Memo

by Brian Beutler

Two of the top Democrats in Congress are calling out their Republican counterparts for abandoning high-stakes debt talks, and have provided new details about the tax proposals that sent the GOP packing.


"To paraphrase speaker Boehner, this was not an adult moment," said Sen. Chuck Schumer (D-NY) on a conference call with reporters. "There needs to be revenues in any deal."

Schumer was not a member of the bipartisan debt discussion group led by Vice President Joe Biden. But Rep. Chris Van Hollen (D-MD) was, and on the call he explained the tax proposals Democrats tried to put on the table that the GOP rejected.

In essence, Van Hollen said, Republicans chose to "protect taxpayer subsidies for big oil companies, tax breaks for corporate jets, and tax breaks for millionaires."

Democrats want to close tax loopholes that benefit oil companies, and eliminate a tax preference that gives corporate aircraft a friendlier depreciation schedule than commercial aircraft. Additionally, Van Hollen said, Democrats were proposing to phase out tax deductions and certain credits for people making more than $500,000 a year. These would be paired with a reduction in the tax burden on lower earners, by eliminating existing limitations on their deductions.

"Folks with over $500,000, we're going to phase out your deductions and some of your tax credit," Van Hollen said.

Brad Dayspring, spokesman for House Majority Leader Eric Cantor suggest this is only part of the story -- it wasn't just loopholes that blew up the talks, but broad rate hikes.

"While Congressman Van Hollen's selective memory is amusing, the bottom line is that the proposals pushed by Democrats would increase taxes by hundreds of billions of dollars on individuals, small businesses, and employers at a time when we need to focus on job growth," Dayspring said -- language Republicans often use to describe previous Dem proposals to create a new tax bracket for millionaires, or let the Bush tax cuts for high-income earners expire.

The full extent of the proposals Dems brought to the table thus remain unclear. But in any event, Republicans balked.

"The message Republicans sent was...unless we accept their lopsided approach...they're prepared to tank the economy," Van Hollen said.

Democrats, Schumer noted, had agreed to extensive spending cuts painful to their interests, but "when it comes time to talk about things that are painful to them, they walk away."

The new Democratic demands come as Republicans re-up their insistence that tax increases are completely off the table. "The president and his party may want a debt limit increase that includes tax hikes, but such a proposal cannot pass the House," said House Speaker John Boehner (R-OH) in a press statement. "The president and his party may want a debt limit increase without spending cuts that exceed the amount of the debt limit hike, but such a proposal cannot pass the House. The president and his party may want a debt limit increase without budget reforms that will restrict Washington's ability to spend in the future, but such a proposal cannot pass the House. These are the realities of the situation."

http://tpmdc.talkingpointsmemo.com/2011/06/top-dems-provide-fresh-detail-on-high-income-tax-proposal-that-led-gop-to-abandon-debt-talks.php