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Last night, we got a preview of the Congressional Republican “Pledge to America.” This morning – at a small business that would likely benefit from the President’s plan to help small businesses – they unveiled the full thing. As news reports have already noted, there weren’t many new ideas in it, and the document was largely fluff obscuring a return to the same old special interest policies that caused this recession. But a close look at what the real-life implications of their “pledge” would be if enacted are nothing short of alarming:
Cut Taxes for Millionaires and Billionaires While Adding Trillions to the Deficit: We have been through this before. So let’s be clear again. Under the Obama plan, every American family will receive a tax cut up to the first $250,000 of their income. For those who make more than $250,000, this change would leave their tax rates on income above $250,000 at or below the rates that existed when President Clinton was in office and when the economy created 23 million jobs. As for the Congressional Republican plan, their pledge is to continue hold middle class tax relief hostage in order to provide an average tax cut of $100,000 to millionaires and billionaires. And the price is one we simply can’t afford: $700 billion. This tax cut would be, according to the non-partisan Congressional Budget Office, just about the worst way to jumpstart our economy and help create jobs.
Add Trillions to the Deficit: The Congressional Republican plan would add trillions to the deficit, including more than $1 trillion in additional unaffordable tax cuts over the next decade and more than $1 trillion in the subsequent decade from repealing the Affordable Care Act.
Raise Taxes for 110 Million American Families and Put Hundreds of Thousands of Jobs at Risk. As part of their pledge, Congressional Republicans want to cancel unspent Recovery Act funds and stop tens of thousands of job-creating projects, from highway construction to clean energy and environmental cleanup, putting the jobs of hundreds of thousands of Americans at risk. One key part of the remaining Recovery Act funds is the Making Work Pay tax credit. So cancelling all Recovery Act funds represents a pledge to raise taxes on over 110 million American families in every paycheck –a tax hike for the largest number of middle class Americans in history. Taxes for businesses on Main Street would go up, too. Tens of thousands of businesses across the country would see their taxes rise by $27 billion, making it harder to keep current employees and hire new ones. The Congressional Republican agenda puts the jobs of hundreds of thousands of Americans at risk, as Recovery Act funding would be pulled from tens of thousands of highway construction, clean energy, environmental clean-up, and other projects already underway in big cities and small towns across America. In addition, rolling back the Recovery Act would threaten the jobs of tens of thousands of Americans as clean energy businesses lose funding for solar plants, wind farms, battery factories and other projects across America.
Oppose Real Relief for Small Businesses: Congressional Republicans have consistently opposed the Administration’s efforts to cut taxes for small businesses. They voted against the 8 small business tax cuts the President has already signed, including tax cuts to encourage investment, job growth and health care. Following their event this morning, House Republican leaders will be voting – presumably against – another 8 small business tax cuts, including zero capital gains for key investments in small businesses. Instead of supporting these tax cuts, they’ve devised a bankrupt definition of ‘small business’ in an effort to justify unaffordable tax cuts for the rich. Let’s be clear what this proposal would do:
Put Health Insurance Companies Back In Control: Congressional Republicans have pledged to repeal the Affordable Care Act and replace it with a series of special interest proposals under the guise of reform. This is a plan that would have real consequences for the American people and small businesses. Their agenda claims to protect people with preexisting conditions, but it would repeal the Affordable Care Act’s ban on discriminating against uninsured Americans, including children, who have a preexisting condition. It would raise taxes by more than $40 billion on up to 4 million small businesses that provide health benefits to their employees. It would result in premium increases by eliminating the billions of dollars in cost savings measures, and will increase the deficit by more than $1 trillion dollars. It would mean that seniors will pay more for their prescription drugs, and their new free preventive Medicare benefits would be cut. And it would mean that millions of Americans would have to give up their new Patient’s Bill of Rights protections that take effect today.
Return to the Era of Recklessness and Irresponsibility on Wall Street: Instead of supporting the Wall Street reform bill that would stop the practice of bailing out financial companies through programs like TARP, Congressional Republicans voted against it. Now, they are pledging to permanently end it. But TARP spending authority is already set to expire on October 3rd – less than two weeks from now – and thanks to the management of Secretary Geithner and the Treasury Department, the non-partisan Congressional Budget Office expects the program to cost less than 10 percent of the $700 billion authorized. And the bank program, which was the subject of most controversy, is on track to make a substantial profit for taxpayers. The only thing it sounds like Congressional Republicans want to end is the Administration’s housing assistance program, which would mean 650,000 people will be denied a chance to receive a permanent mortgage modification that saves them an average of $500 per month.
Return to the Fiscal Policies that Turned a Record Surplus into a Record Deficit: Congressional Republicans have little credibility when it comes to dealing with our nation’s long-term fiscal challenges. After all, these are the same House Republicans who helped transform a record $236 billion surplus into a record $1.3 trillion deficit, by failing to pay for tax cuts for millionaires and billionaires, two wars and a costly expansion of Medicare. These are the same House Republicans who all voted against reinstating common sense Pay-As-You-Go rules that helped balance the budget during the Clinton Administration. And they are calling for this newfound responsibility in budgeting at the same time as they are pushing to add trillions to future deficits by repealing health reform and extending tax cuts for millionaires and billionaires. And when it comes to entitlements, let’s remember what their solution was when they were in charge: privatize Social Security and turn Medicare into a voucher program. And while some House Republican leaders are trying to distance themselves from their previous position in favor of privatization, others are continuing to push these same radical plans.
Return to Failed Budgets of the Past: After years of fiscal irresponsibility, Congressional Republicans are now pledging to stop their spending spree. But what they’ve proposed would return us to the same failed Bush policies that got us into this mess. Their plan would result in dramatic cuts in basic government services, including:
Dan Pfeiffer is White House Communications Director