Senate Democrats plan to force a series of votes on recommendations from President Barack Obama’s State of the Union address that they say would benefit the middle class and would be difficult for Republicans to oppose.
Senate Democrats will be “pursuing major chunks of the president’s middle-class agenda,” said Sen. Charles Schumer (D-N.Y.), who leads the Senate Democrats’ policy and communications operations. He was speaking at a news conference today — the day after Obama’s speech.
“We’re going to push serious proposals to help create middle-class jobs, we’re going to defend Medicare, and we will pursue tax reform that makes sense for the middle class,” Schumer continued.
Schumer said Republicans would have to either compromise with Democrats or be cast as obstructionist. He cited the example of the payroll tax cut debate last year when Senate Republicans agreed with Democrats to do a short-term extension. The payroll tax cut was due to expire at the end of the year, and disagreement over offsets had kept leaders from reaching a full-year deal.
But House Republicans revolted against the short-term deal, instead pushing for a full-year extension. The move almost killed the compromise and allowed Democrats to embarrass Republicans by painting them as standing in the way of a tax cut.
“Don’t underestimate the chances of Congress to enact parts of the president’s blueprint,” Schumer said. “Republicans will not go along out of a desire to cooperate, but they may find they have to out of political necessity.”
“The payroll tax debate last year showed this strategy has its limits. It showed that if they take their strategy of obstructionism too far and make casualties out of popular middle-class priorities, they’ll be faced with a political backlash,” Schumer said. “So, don’t be surprised if election year pressures in 2012 may push Republicans to cooperate with this president more than they might be planning to. Otherwise, they’re going to find themselves on the wrong side of the middle class again and again.”
While Democrats gave few specifics on legislation resulting from the speech, Schumer did note that tax reform would result in upper-income earners paying more, which he contrasted with Republicans.
“Now, I’ve heard plenty of Republicans repeatedly call for tax reform,” Schumer said. “When Republicans say ‘tax reform,’ it’s often code words for simply reducing taxes on the wealthy.”
In the speech, Obama called for a law that would require millionaires to pay at least a 30 percent tax rate. His proposal comes after GOP presidential contender and former Massachusetts Gov. Mitt Romney released his tax return, which showed that he paid a roughly 14 percent tax rate on income of $190 million to $250 million because he made much of it from investments, which are taxed at a lower rate.
In September, Obama had proposed the “Buffett Rule.” Named for billionaire investor Warren Buffett, the rule holds that individuals making more than $1 million a year should pay at least the same percentage of their earnings as middle-income taxpayers.
“Tax reform after the president’s speech now has a different definition,” Schumer said. “We intend to pursue a different kind of tax reform that borrows from the president’s proposals. For instance, we agree with the president that it makes no sense that a millionaire should pay a lower tax rate than a secretary. So it’s a priority for us to act on some kind of Romney — I mean, Buffett — rule this year.”
It’s an open question whether Congress has the will to change how investment income is taxed. The issue, known as carried interest, was taken on when Democrats led both chambers and the White House, but it never made it into law.
Senate Majority Leader Harry Reid (D-Nev.) brushed aside a question at a news conference asking why this effort would be any more successful.
“I think all you need to do is look at the former governor of Massachusetts’ tax return and that pretty well indicates why it’s become an emergency,” Reid said. “Absolutely we should do it.”
After the news conference, Schumer added that along with a deal to extend the payroll tax cut, the Senate will consider legislation to reauthorize Federal Aviation Administration programs, a bill to reauthorize surface transportation programs and a reform of the postal system.
However he stressed that “we are going to continue to [hold these Obama proposal votes] for quite a while.”
Republicans dismissed the Democratic agenda as politically motivated as Democrats brace to hold on to the White House, keep their majority in the Senate and make gains in the House.
“When Democrats say ‘tax reform,’ it’s code for raising taxes on everyone,” a GOP aide said. “We are glad to see that Democrats agree the tax code needs to be addressed. Republicans have called for comprehensive tax reform and we welcome that debate.”
“Democrats are eyeing everyone as their target for tax increases,” the aide said. “We don’t think it’s a good idea to raise taxes given the weak economy.”