Last Friday, the President signed legislation, H.R. 4853, making the Obama-McConell tax deal the law of the land. I opposed the deal and voted against the bill.
The bill contained over $100 billion in tax cuts for the wealthy and an estate tax “compromise” designed to benefit the wealthiest inheritors, neither of which will reduce unemployment. The deal also contained a payroll tax “holiday” which ignores federal retirees and endangers the future of Social Security. The payroll tax provision in this bill cuts worker contributions to Social Security $112 billion over the next two years.
While those billions will be restored to the Social Security trust with deficit spending from the General Fund, this “holiday” establishes the dangerous precedent of separating Social Security from worker contributions. Furthermore, I have a hard time believing that this cut in the payroll tax will expire on schedule. Dan Bartlett, President Bush’s former Communications Director, has explained the Republican strategy: “We knew that, politically, once you get [a tax cut] into law, it becomes almost impossible to remove it…The fact that we were able to lay the trap does feel pretty good, to tell you the truth.”
Ultimately, I voted no because this deal sets the stage for a permanent and unsustainable alteration of our tax rates that will cripple this country’s effort to come to grips with our fiscal situation. The over $800 billion dollar cost of this deal pales in comparison to the trillions of dollars that the federal government will lose if these taxes are extended in the long term, as I believe is likely now that this deal has become law.
This was not a decision I made lightly, the Unemployment Insurance extension in the bill will help many Americans. But those benefits should never have been held hostage in order to secure tax cuts for those who need them least.
The expiration of the Bush tax cuts gave us a chance to rechart the fiscal course of this nation. It was the responsibility of the political leadership of the United States to take this opportunity to right our fiscal ship of state. This deal, unfortunately, represents an abdication of that responsibility.
Rep. James Moran (D) is Virginia’s 8th Congressional District Representative in the U.S. House of Representatives.
