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Tax Increases, part III
Posted By Barry Ritholtz On February 22, 2004 @ 9:24 pm In Finance | Comments Disabled
Now, even Congress has recognized the fiscal realities . But leadersin Congress have a small problem — “they are in a dilemma over the budget time frame. If they draft a 10-year plan showing the tax cuts ending, they defy their president’s wishes. But a 10-year plan showing the tax cuts continuing would project a huge deficit, which lawmakers do not want to address in an election year.”
Hmmm, seems like a tricky problem. So how do our spineless representatives deal with so difficult a conundrum? They don’t. They turn instead to a five-year plan that avoids both problems:
“Congressional budget writers next month will likely draft truncated blueprints for tax-and-spending policies that will effectively ignore President Bush’s call to extend his tax cuts beyond their 2010 expiration date, House and Senate budget aides said yesterday.
The decision to draft five-year budget plans — rather than the 10-year plans of recent sessions — would mean that any effort this year to extend the cuts will take 60 votes to block a Democratic-led filibuster in the 100-member Senate. That is a hurdle that even Republicans say is insurmountable in an election year.”
Brace yourself. Reality avoidance ahead!
Budget Plan May Block Extension of Tax Cuts 
Washington Post Staff Writer
Friday, February 20, 2004; Page A04
Article printed from The Big Picture: http://www.ritholtz.com/blog
URL to article: http://www.ritholtz.com/blog/2004/02/tax-increases-part-iii/
URLs in this post:
 tax rises: http://bigpicture.typepad.com/comments/2004/02/tax_increases_a.html
 Tax Scams: http://bigpicture.typepad.com/comments/2004/02/tax_me_if_you_c.html
 fiscal realities: http://www.washingtonpost.com/ac2/wp-dyn/A55934-2004Feb19?language=printer
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