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Tax law

Tax Cut Compromise: Representative Michele Bachmann on the Republican Stance

Strategic Insights

— 1 min read

Representative Michele Bachmann (R-MN), chairwoman of the House Tea Party Caucus and a tax lawyer, expressed her concerns about the recent tax cut compromise, which includes extending the Bush-era tax cuts and unemployment benefits. The deal, valued between $700 billion and $900 billion, has a hefty price tag that may not sit well with the fiscally conservative tea partiers. Bachmann pointed out that the extension of unemployment benefits for 13 months costs $54 billion, which does not appear to be offset, adding to the deficit. She also noted that the 2% reduction in the payroll tax for employees will decrease revenue for the Social Security trust fund, further adding to the deficit.

Key Takeaways:

  • Representative Michele Bachmann, a tax lawyer and chairwoman of the House Tea Party Caucus, expressed concerns about the tax cut compromise.
  • The compromise includes extending the Bush-era tax cuts and unemployment benefits, with a price tag of $700-$900 billion.
  • The extension of unemployment benefits for 13 months costs $54 billion, with no apparent offsets, adding to the deficit.
  • The 2% reduction in the payroll tax for employees will decrease revenue for the Social Security trust fund, adding to the deficit.
  • Bachmann emphasized the importance of preserving tax cuts for all Americans, preventing massive tax increases.
  • The compromise may have unintended consequences, with Bachmann defining the "real cost" as the outlay of unemployment benefits and the reduction in the Treasury's Social Security funds.
  • As a practical matter, Bachmann suggested that waiting until the lame-duck Congress expires and the Republicans take power in January may not be a viable option.

Statistics:

  • The tax cut compromise has a price tag of $700-$900 billion.
  • The extension of unemployment benefits for 13 months costs $54 billion.
  • The rate of the payroll tax reduction is 2%.
  • The government spent $54 billion more on Social Security than it took in revenue in 2010.
  • The Social Security trust fund will experience a decrease in revenue due to the payroll tax reduction.

Sources:

  • FOX NEWS CHANNEL "AMERICA LIVE" INTERVIEW WITH REPRESENTATIVE MICHELE BACHMANN
  • Federal News Service, Inc.
  • Copyright 2010 by Federal News Service, Inc.
  • www.fednews.com

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