Bring on the Millionaires' Surtax
The White House has low expectations for how House Republicans will deal with the American Jobs Act, but President Obama and his team have higher hopes for Senate Democrats. Indeed, the House rejecting a jobs bill is expected; the Senate rejecting a jobs bill is embarrassing.
The problem in the Senate has nothing to do with the merits of the plan. Senate Dems are broadly on board with the basic structure of the White House plan -- infrastructure investments, tax breaks, saving public-sector jobs, etc. -- but are struggling with how to pay for it. Obama's approach, most notably ending tax subsidies to oil companies, has caused some center-right Dems to balk.
As a result, when The Hill says Republicans "are more united against Obama's plan than Democrats are for it," that's a fair assessment.
Senate Majority Leader Harry Reid's (D-Nev.) task, then, is tweaking the financing options to keep his caucus on board. Brian Beutler had a good scoop yesterday, identifying what might do the trick.
Seeking to consolidate party support for President Obama's jobs bill, Senate Democrats are considering a proposal to impose a five percent surtax on millionaires to pay for the legislation, according to two party aides. [...]
During the tax fight last December, Sen. Chuck Schumer (D-NY) proposed a creating a new millionaires tax bracket, rather than letting the Bush tax cuts expire for income above $250,000. It failed to overcome a filibuster but garnered broad Democratic support. And it also would have more than paid for Obama's jobs bill.
That's why something along these lines seems likely to bring most, if not all, Dems into the fold.
I've seen some accounts suggesting this is evidence of Senate Dems breaking with the White House, but that appears to be an exaggeration. Folks in the West Wing are far more concerned with the provisions in the American Jobs Act related to job creation and economic growth than they are with financing. If Congress wants to pass the jobs bill, but come up with a different way to pay for it, I don't imagine the president and his team will mind.
Will literally every Senate Dem get on board if the financing relies on a surtax on millionaires. Probably not. As Reid joked yesterday, "You can't trap me into unanimous. As I've indicated here before, to get all my senators to agree that I can take a break and go to the bathroom, I can't quite get that."
But if just about all of the Senate Dems support the plan, the White House will be able to say that a majority of the Senate -- like a majority of the American people and a majority of economists -- backs the Americans Jobs Act, and it's time for congressional Republicans to stop holding the economy back.