The NRCC's Lies Are Costing Mississippi Voters

October 27, 2010 12:01 pm ET

The NRCC tries to pin a price tag on how much a vote for Rep. Gene Taylor (D-MS) would cost Mississippi voters — and fails miserably. Though the NRCC's latest ad feigns objectivity by citing data from the non-partisan Tax Foundation, it completely ignores the organization's conclusion and makes up its own, suggesting that a vote for Taylor is a vote for $1,556 in higher taxes. However the NRCC bases this conclusion on the false claim that Democrats want to eliminate all of the Bush-era tax cuts. In fact, the Tax Foundation's study shows that middle class families will have lower taxes because Speaker Pelosi and the Democrats in Congress favor extending tax cuts to 97% of American families. Additionally, if taxes did increase in 2011, voters would have Republicans to thank for writing in an expiration date on the Bush tax cuts in order to hide their true cost.

NRCC: "How Much Does Gene Taylor's Loyalty To Pelosi Cost You?"

How much does Gene Taylor's loyalty to Nancy Pelosi cost you? How about $1,556 a year? Are you ready to write that check? That's what an average middle class family in south Mississippi will pay after tax rates increase in January. With Nancy Pelosi, that's the plan, and Gene Taylor voted for it. So get out your checkbook or get a new Congress. The National Republican Congressional Committee is responsible for the content of this advertising.

No, That's NOT The Plan — Democrats Plan To Extend 97% Of Bush Tax Cuts

PolitiFact: Dems Consistently Say Only Tax Cuts For Wealthiest Will Be Allowed To Expire. According to the non-partisan PolitiFact.com, in their analysis of an allegation from Rep. Mike Pence that Democrats want all tax brackets to rise:

Do Democrats want every tax bracket to rise, as Pence suggests? In a word, no.

For many months, Democratic officials have consistently said that they intend to let only the tax cuts for the wealthiest individuals lapse. The cutoff they usually suggest is $200,000 for individuals and $250,000 for married couples filing jointly. President Obama campaigned on just such a plan, and we've logged those promises into our Obameter campaign promises database.

[...]

Pence is right that every tax bracket will go up if the law is not extended. Still, we think the claim that Democrats don't want to extend the law is inaccurate. While the legislative drafting is still in process, the Democratic majority in Congress has made clear that it plans to extend tax cuts for all but the top couple percentage points of the income distribution. So it's highly misleading for him to say that Democrats actually want to see all the bill's cuts expire. Indeed, Pence's comment verges on a scare tactic.

[PolitiFact.com, 7/22/10, emphasis original]

Reuters: "Two To Three Percent Of Americans" Are Affected By Democrats' Proposals. According to Reuters: "Lawmakers are mulling the renewal of tax cuts enacted in 2001 and 2003 under former president George W. Bush that expire at the end of this year. President Barack Obama and his Democratic allies in Congress want to extend the lower rates for individuals earning less than $200,000 or couples making less than $250,000. About two to three percent of Americans fit into the upper income categories." [Reuters7/21/10]

President Obama's FY2011 Budget Calls For Extending Bush Tax Cuts For Families Making Less Than $250,000 Per Year. As Market Watch reported in February: "Facing a gaping deficit but aiming to spur job creation at the same time, President Barack Obama's fiscal year 2011 budget would hit top earners, oil companies and others while giving tax breaks to small businesses to help them hire new workers. ... Obama wants tax breaks proposed by President George W. Bush to expire this year. His budget would eliminate tax breaks on those making more than $250,000 a year, a move almost certain to be opposed by Republicans and perhaps some Democrats as the economy crawls out of the recession. 'We extend middle-class tax cuts in this budget,' Obama said Monday at the White House, but 'we will not continue costly tax cuts for oil companies, investment fund managers, and those making over $250,000 a year. We just can't afford it.'" [Market Watch2/1/10]

Speaker Pelosi: High-End Tax Cuts Should End. According to The Hill: "House Speaker Nancy Pelosi (D-Calif.) on Thursday rejected extending tax cuts for the wealthiest tax bracket that are set to expire at the end of the year. Pelosi took off the table a short-term extension of those cuts floated by some lawmakers in her own party. 'No,' the speaker said at her weekly press conference when asked if the cuts for the highest bracket should be extended. 'Our position has been that we support middle-class tax cuts. ... I believe the high-end tax cuts did not create any jobs, increased the deficit and should be repealed,' she said." [The Hill7/22/10, emphasis added]

Treasury Secretary Geithner: We Will Extend Middle- And Lower-Income Provisions Of Bush Tax Cuts. According to the Wall Street Journal: "The Obama administration will allow tax cuts for the wealthiest Americans to expire on schedule, Treasury Secretary Timothy Geithner said Thursday, setting up a clash with Republicans and a small but vocal group of Democrats who want to delay the looming tax increases. Mr. Geithner said the White House would allow taxes on top earners to increase in 2011 as part of an effort to bring down the U.S. budget deficit. He said the White House plans to extend expiring tax cuts for middle- and lower-income Americans, and expects to undertake a broader revision of the tax code next year. 'We believe it is appropriate to let those tax cuts that go to the most fortunate expire,' Mr. Geithner said at a breakfast with reporters." [Wall Street Journal7/23/10, emphasis added]

New York Times: Obama Plan Leaves Much Of The Bush Tax Cuts In Place. The New York Times prepared an infographic showing where President Obama seeks to change Bush-era tax law, and where he intends to leave it unchanged:

Obamataxcuts

[New York Times7/25/10]

NRCC's Source For Middle-Class Tax Hike Claim Confirms That Middle Class Families Pay Lower Taxes Under Democrats' Plan

The NRCC's ad cites an August 1, 2010 report from the Tax Foundation to claim that taxes on middle class families would cost an additional $1,556 per year.

Tax Foundation Report: Under Democrats' Proposal Middle-Class Families Would Pay Lower Taxes In 2011. According to an analysis by the Tax Foundation, cited in American Freedom Fund's ad: "The two tables below show how the 'average middle-income family' for each state (Table 1) and congressional district (Table 2) would be affected by expiration of the Bush-era tax cuts in 2011. Congressional districts are organized by the alphabetic order of states and then the congressional district's number. Note that in this report, we do not present the results under the proposed policies of President Obama, although in most circumstances, the 'average middle-income' family would not see much difference between the president's proposal and the scenario of Bush-era tax cuts extended. Technically, most families falling in the middle of the income distribution would see lower tax bills under the proposed policies in the president's budget when compared to a mere extension of the Bush-era tax cuts for 2011 due to his proposed one-year extension of the Making Work Pay tax credit, which was labeled in the president's budget as a 'temporary economic recovery' measure." [The Tax Foundation, 8/1/10, emphasis added]

Taylor's Vote For FY2009 Budget Was Not A Vote For Tax Increases

The NRCC's ad cites Taylor's vote for the FY2009 budget as a vote to raise taxes.

PolitiFact: Claim That FY2009 Budget Raised Taxes Is "False." According to PolitiFact.com:

PolitiFactFalse[T]he fiscal 2009 budget resolutions the House and Senate adopted in March don't have line items on tax proposals. The Democrats who wrote them assume that many of President Bush's 2001 and 2003 tax cuts will expire at the end of 2010 - a development that would bring more revenue into the government's coffers and perhaps help the Democrats make good on their pledge to balance the budget by 2012.

[...]

Those same Democratic lawmakers who wrote the budget resolution also support extending at least some of the tax cuts that have helped lower- and middle-income taxpayers. In fact, during the full Senate debate on the chamber's resolution, lawmakers adopted an amendment by Senate Finance Committee Chairman Max Baucus, D-Mont., that would extend the child tax credit, marriage-penalty relief provisions and other components in the 2001 tax package.

Democrats say they haven't yet made final decisions on which tax cuts will stay and which will go, and they maintain those tax cuts that are extended will be offset by tax increases elsewhere or by spending cuts. In other words, the budget resolution doesn't provide enough specifics to know the net effect on taxes, up or down. [PolitiFact.com, 4/7/08]

PolitiFact: Budget Resolutions Cannot Change Tax Law. According to the non-partisan PolitiFact.com in its fact check of Sen. John McCain's claim that Democrats's budget resolution would raise Americans' taxes: "First, budget resolutions don't have the force of law; the majority party uses them both to make a political statement and to set nonbinding parameters for considering tax and spending legislation. So it's technically incorrect to say the budget resolution will raise, lower or even keep taxes the same. The documents cannot change tax law." [PolitiFact.com, 4/7/08]

It Was Republicans Who Set An Expiration Date For The Bush Tax Cuts

Time: Congress Wrote Tax Law To Expire After 2010 Because It Made Cuts Appear Cheaper. According to Time:

Topping the list of odd features is the "sunset" provision that repeals the entire bill at the end of 2010. Budget rules require Congress to include a sunset clause in all major tax legislation, but this sunset arrives a year early--after 10 years instead of the 11 years covered by the current budget resolution. That year was shaved off to keep the total cost of the bill under $1.35 trillion. By repealing the legislation in the 10th year, Congress saved billions of dollars. Without the repeal and a few other tricks, the cost of the full 11-year plan would balloon to more than $1.8 trillion by the end of 2011, far exceeding anything the Democrats would vote for. And the cost in the second decade would reach as much as $4 trillion. Even some conservatives on Capitol Hill are dismayed by the apparent dishonesty of the early sunset. After both parties agreed to a smaller tax cut, the conference committee pulled a fast one.

[Time6/3/01, emphasis added]

American Enterprise Institute: Reconciliation "Ploy" To Pass Bush Tax Cuts Means They Expire After 10 Years. According to Norman Ornstein, resident scholar at AEI:

It is worth repeating why we are in this particular car heading toward the cliff. When the Bush tax cuts were on the agenda at the very beginning of his presidency, Republicans in Congress and the White House made a tactical choice to avoid giving Senate Democrats the leverage that a 60-vote hurdle can provide by employing reconciliation (yes, the same tool that those who applied it then condemned roundly when it was used for health care reform this year). It was tricky to use reconciliation for tax cuts, which increased deficits when reconciliation was specifically supposed to be used for revenue-neutral or deficit-reducing programs. But the decision was made to use it for this purpose--but not to violate the proviso that the plan would increase deficits outside the budget window of 10 years.

That meant a ploy of declaring that all the tax cuts would expire entirely after 10 years, including the absurd-on-its-face provision that estate taxes would gradually decline to zero in 2010--and then be fully restored in 2011. From the day after the tax cuts were signed into law, Republicans were campaigning to extend them, in effect admitting that the policy was built around a "never mind" ruse. To be fair, there were plenty of ruses in the health care reform reconciliation, so it is not as if one party is clean--this is legislative politics. But the charges now emanating from Republicans that the Democrats are going to be responsible for a huge tax hike is, shall we say, bemusing.

[AEI.org, 7/21/10, emphasis added]

Ezra Klein: Reconciliation Maneuver Meant "Twisting A Budget Process Meant To Reduce The Deficit." According to the Washington Post's Ezra Klein:

In order to maximize the size of the cuts, Republicans had to minimize the influence of minority Democrats on the package. So they chose to run the bill through the reconciliation process. But that posed some challenges. Budget reconciliation had never been used to increase the deficit. In fact, it specifically existed to decrease the deficit. That's why one of its rules was that you couldn't use it to increase the deficit outside the budget window. Republicans realized they could take that very literally: The budget window was 10 years. So if the tax cuts expired after 10 years, they wouldn't increase the deficit outside the budget window. They'd also have the added benefit of appearing less costly in the Congressional Budget Office's estimates, as the CBO duly scored them as expiring after 10 years, which kept the long-range budget picture from exploding.

But the plan was never to have the tax cuts expire. Instead, the idea was that people would get used to the new tax rates, and no future Congress would want to allow a big tax increase, so when the time came, either Republicans in office would extend the cuts or Republicans in the minority would hammer Democrats until they extended them. And that's where we are now: Democrats control the government, so Republicans are screaming about tax increases as a way to get Democrats to extend tax cuts.

It's really hard to know where to start with this one. It's not a tax increase passed into law by Democrats. It's a reversion to old tax rates passed into law by Republicans. It's not how law is supposed to work. It's the result of twisting a budget process meant to reduce the deficit so you could use it to massively increase the deficit.

[Washington Post7/19/10, emphasis added]

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