Tax games continue

Today we have seen two votes in the Senate with regard to plans by the Democrats to raise taxes on small businesses and those with high incomes. First, a plan to raise taxes on all those who have incomes over $250,000 was voted down. Next a modified version that limited the tax increases to those with incomes over one million dollars was voted down. The result was preordained since all of the Republicans had made clear that they would not vote for any income tax increases in the middle of the current economic turmoil. Much of the burden of these increase would fall onto small businesses and would likely reduce the chance for creation of new jobs. As a result, such tax increases would likely lead to higher unemployment for longer periods.

In typical fashion, Democrats like Chuck Schumer said that the Republicans wanted tax cuts for the super rich, even though it was the Democrats who wanted to make sure that rates for these folks go up substantially next year. Only in Washington does defeat for a tax increase constitute a tax cut for the wealthy.

It was not only Republicans who voted against the tax increases, however. Five Democrats sided with the GOP on each of the votes. Hopefully, the Democrats will now get serious about negotiating a compromise that will allow tax rates for everyone to stay the same next year. Even though the tax increase scheduled for 2011 has be looming for the last two years, this week marked the first time that Democrats allowed a vote on any plan to prevent any of the tax increases from happening. Sadly, the Democrats left this problem fester until we are now faced with the need for there to be a decision made in hours that should have been reviewed carefully and made over the course of the last six months. All that is left is for Nancy Pelosi to tell us that Congress has to pass the tax bill so that we can all find out what is in it.