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Obama Raises Tax Hike Threshold To $400,000

From the Associated Press:

Obama backs off hard lines in search of compromise

By By JIM KUHNHENN | December 18, 2012

WASHINGTON (AP) — Narrowing a "fiscal cliff" negotiating gap, President Barack Obama is backing off what had once been ironclad positions.

A new proposal handed to House Speaker John Boehner on Monday drops Obama’s long-held insistence that taxes rise on individuals earning more than $200,000 and families making more than $250,000. He is now offering a new threshold of $400,000 and lowering his 10-year tax revenue goals from the $1.6 trillion he had argued for a few weeks ago.

Obama also abandoned his demand for permanent borrowing authority. Instead, he is now asking for a new debt limit that would last two years, putting its renewal beyond the politics of a 2014 midterm election.

It’s always about getting past the next election with the Democrats. Which is the kind of thinking that got us the current fiscal cliff in the first place.

And in a move sure to create heartburn among some congressional Democrats, Obama is proposing lower cost-of-living increases for Social Security beneficiaries —

Which is to say to reduce Social Security Cost Of Living Adjustments (COLAS). Which Obama and the Democrats will then magnanimously ‘waive’ at the right time, to buy some senior votes.

[E]mploying an inflation index that would have far-reaching consequences, including pushing more people into higher income tax brackets.

Which is, in effect, changing the tax rates. In any case, it accomplishes the same goal of getting more income tax from the middle class.

Those changes, as well as Obama’s decision not to seek an extension of a temporary payroll tax cut, would force higher tax payments on the middle class, a wide swath of the population that Obama has repeatedly said he wanted to protect from tax increases.

What a stunning admission from the Associated Press. But the elections are over. So all of Obama’s promises to never raise taxes on the middle class can be forgotten. Besides, in time, the Democrats will blame all these tax increases on the Republicans, anyway.

The concessions signal a new stage in the negotiations, where posturing has given way to pragmatism and where both sides still seem willing to lock in on a substantial agreement rather than just putting off a fiscal day of reckoning…

Somehow "pragmatism" always turns out to be the Republicans conceding to everything the Democrats want.

In making his offer, Obama stiff-armed Republican demands to increase the eligibility age for Medicare from 65 to 67, a goal Democrats strongly reject. He also sought to contain cuts in Medicare and other health care programs to about $400 billion over 10 years, less than what Republicans want.

Why quibble? They will never happen, anyway?

And he is continuing to seek spending on unemployment assistance and on public works projects

Naturally, Obama still wants to increase spending for his peeps.

Over time, because annual adjustments to the poverty level would be smaller, the new index could reduce the number of people eligible for programs such as Medicaid, Head Start, food stamps, school lunches and home heating assistance.

To avoid some of that risk, Obama wants lower-income recipients to receive protection against any loss from scaling back future cost-of-living increases, people familiar with his plan said…

In other words, none of these COLA ‘cuts’ will ever really happen. At least not for Obama’s constituents, anyway. So don’t worry.

This article was posted by Steve on Tuesday, December 18th, 2012. Comments are currently closed.

One Response to “Obama Raises Tax Hike Threshold To $400,000”

  1. yadayada says:

    he only needs to “say” he’s “considering” making concessions on a few inconsequential limits and the press will wildly prance about declaring how wonderful the great communicator/negotiator is.
    when the rubber meats the road, the lefties in both parties will get everything they want.
    anyone in office who even peripherally agrees with the Tea Party will be aghast that our country has fallen as far as it has. how can they let Boner do what he’s doing?

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