I missed the Associated Press article by Stephen Ohlemacher yesterday until I was in Hy-Vee Gas today and saw the front page of the print edition of The Des Moines Register. My jaw about dropped. The picture of the front page below is courtesy of Newseum.
The headline that the Register gave this article practically had me laughing out loud. “Millions will save with new tax law”? How about “Millions can continue saving for the next two years”? All this bill represents is an extension of Bush era tax cuts. There is one new tax cut in this bill, and it only lasts one year. At least Ohlemacher in his piece said as much:
The law extends most of the tax cuts for two years, including lower rates for the rich, the middle class and the working poor, a $1,000-per-child tax credit, tax breaks for college students and lower taxes on capital gains and dividends. A new one-year tax cut will reduce most workers’ Social Security payroll taxes by nearly a third next year, from 6.2 percent to 4.2 percent.
A mishmash of other tax cuts will be extended through next year. They include deductions for student loans and local sales taxes, and a tax break for using mass transit. The alternative minimum tax will be patched, sparing more than 20 million middle-income families from increases averaging $3,900 in 2010 and 2011.
But yet, he calls it “the most significant new tax law in a decade.”
But let’s get something straight folks, President Obama did not lower your taxes. I appreciate Kathie Obradivich of The Des Moines Register pointing this out on Thursday saying, “A tax increase deferred is not a tax cut in my book, no matter how the politicians and pundits spin it.” Very true. While it is great to not have taxes go up January 1, not making the cut permanent creates uncertainty.
Unfortunately this bill comes with new spending as it was linked to an extension of unemployment benefits for those who have been unemployed for up to 98 weeks. What was supposed to be a short-term safety net is now enabling long-term unemployment.
This bill while it isn’t a total crap sandwich, is about half of one so I guess that makes it easier to swallow. Perhaps the fact that Senate Minority Leader Mitch McConnell was the only Republican Senator present at the bill’s signing shows you how popular this bill is with Republicans.