Washington – Senate Republicans would probably agree to higher tax rates on the wealthiest Americans if it meant getting a chance to overhaul costly government entitlement programs like Medicare and Social Security, a GOP senator predicted Sunday.
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The comments by Bob Corker of Tennessee — a fiscal conservative who has been gaining stature in the Senate as a pragmatic deal broker — puts new pressure on House Speaker John Boehner and other Republican leaders to rethink their long-held assertion that even the very rich shouldn’t see their rates go up next year. GOP leaders have argued that the revenue gained by hiking the top two tax rates would be trivial to the deficit, and that any tax hike hurts job creation.
But Corker says insisting on that red line — especially since President Barack Obama won re-election after campaigning on raising tax rates on the wealthy — might not be wise.
“There is a growing group of folks looking at this and realizing that we don’t have a lot of cards as it relates to the tax issue before year end,” Corker told “Fox News Sunday.”
If Republicans agree to Obama’s plan to increase rates on the top 2 percent of Americans, Corker added, “the focus then shifts to entitlements and maybe it puts us in a place where we actually can do something that really saves the nation.”
Besides getting tax hikes through the Republican-dominated House, Corker’s proposal faces another hurdle: Democrats haven’t been receptive to GOP proposals on the entitlement programs. Senate Democratic Whip Dick Durbin, D-Ill., on Sunday was skeptical about proposals to increase the eligibility age for Medicare from 65 to 67. He said he doesn’t see Congress addressing the complicated issue of Medicare overhaul in the three weeks remaining before the end of the year.
“I just don’t think we can do it in a matter of days here before the end of the year,” Durbin said. “We need to address that in a thoughtful way through the committee structure after the first of the year.”
The clock is ticking to avert the so-called “fiscal cliff,” when a combination of automatic tax increases and spending cuts kick in at the beginning of the year. Negotiations are taking place primarily between Obama and the GOP’s Boehner, whose party controls the House and comprises mostly hard-line fiscal conservatives who are holding fast to their position.
“No Republican wants to vote for a rate tax increase,” said Rep. Jeb Hensarling, R-Texas, chairman of the House Republican Conference.
Added Rep. Marsha Blackburn, R-Tenn.: “I’m not sure there is support for the rate hikes. There is support for revenue by cleaning up the code.”
But at least one House Republican has said there is another way. Rep. Tom Cole, of Oklahoma, has said Obama and Boehner should agree not to raise tax rates on the majority of Americans and negotiate the rates for top earners later. Cole said Sunday that most House Republicans would vote for that approach because it doesn’t include a rate hike.
“You know, it’s not waving a white flag to recognize political reality,” Cole said.
Sen. Tom Coburn, R-Okla., already has said he could support higher tax rates on upper incomes as part of a comprehensive plan to cut the federal deficit.
When asked Sunday what it would take to sign on to a tax rate increase, Coburn echoed Corker’s comments by responding: “Significant entitlement reform.” He quickly added, however, that he has estimated that such a tax rate increase would only affect about 7 percent of the deficit.
“Will I accept a tax increase as a part of a deal to actually solve our problems? Yes,” Coburn said. “But the president’s negotiating with the wrong people. He needs to be negotiating with our bondholders in China, because if we don’t put a credible plan on the discussion, ultimately, we all lose.”
Obama’s plan would raise $1.6 trillion in revenue over 10 years, partly by letting decade-old tax cuts on the country’s highest earners expire at the end of the year. He would continue those Bush-era tax cuts for everyone except individuals earning more than $200,000 and couples making above $250,000. The highest rates on top-paid Americans would rise from 33 percent and 35 percent to 36 percent and 39.6 percent.
Boehner has offered $800 billion in new revenues to be raised by reducing or eliminating unspecified tax breaks on upper-income people. The Republican plan would cut spending by $1.4 trillion, including by trimming annual increases in Social Security payments and raising the eligibility age for Medicare.
Hensarling and Coburn spoke on ABC’s “This Week.” Blackburn and Cole spoke on CNN’s “State of the Union.” Durbin spoke on NBC’s “Meet the Press.”
I wanted Romney vs Obama, but I’m glad Obama won.
These Republicans cannot faargin a tax hike to the top earners of this country unless it’s coupled with an increase to middle income wage earners who CANNOT afford one or short changing people in retirement on the few measly Social Security dollars.
Shame on these Republican anti-Americans!
Can we stop the Obama style of class warfare? NO ONE was ever hired by a poor person – NO ONE!
There should be no discussion until obama is ready to cut spending NOW! Not in 10 years – NOW – this minute!! Otherwise tell him yishukayni!
I am thank G-d in the top 2% and really don’t mind having my taxes go up. I do mind that there are 47,000,000 people on welfare and 50% of them aren’t getting it legally.
Cut spending. This is where the savings are. By raising taxes on the wealthy, will only raise enough revenue to cover 7 days of gov’t spending.