Weekly Address: It’s Time for Congress to Pass the Middle Class Tax Cut Extension
Over the past couple weeks I’ve been talking with folks across the country about how we’re going to rebuild an economy where if you work hard, you and your family can get ahead.
And right now, there’s a big debate going on in Washington over two fundamentally different paths we can take as a country to do that.
One path – pushed by Republicans in Congress and their nominee for President – says that the best way to create prosperity is to let it trickle down from the top. They believe that if we spend trillions more on tax cuts for the wealthy, it’ll somehow create jobs – even if we have to pay for it by gutting education and training and by raising middle-class taxes.
I think they’re wrong. We already tried it that way for most of the last decade, and it didn’t work. We’re still paying for trillions of dollars in tax cuts that benefitted the wealthiest Americans more than anyone else; tax cuts that didn’t lead to the rise in wages and middle class jobs that we were promised; and that helped take us from record surpluses to record deficits.
The last thing we need right now is more top-down economics. What we need are policies that will grow and strengthen the middle class; that will help create jobs, make education and training more affordable, and encourage businesses to start up and stay right here in the United States.
Soon, we’ll face a choice between these two different approaches. On January 1st, taxes are set to go up for tens of millions of Americans. I think that would be a huge financial hit for middle-class families. That’s why I’ve cut middle-class taxes every year that I’ve been President – by $3,600 for the typical family. And that’s why, this week, I called on Congress to immediately stop the January 1st tax hike from hitting any American on the first $250,000 of their income.
Under my plan, 98% of American families won’t see their income taxes go up at all. But the other 2% of Americans will have to pay a little more in taxes on anything they make over $250,000. In other words, the wealthiest few Americans will go back to the income tax rates they were paying under Bill Clinton. And if you remember, that was when our economy created nearly 23 million new jobs, the biggest budget surplus in history, and millionaires were doing pretty well.
The folks in Congress and on the campaign trail who oppose this plan warn that it would somehow hurt small businesses and job creators. Well, they’re completely ignoring the facts.
Under my plan, 97% of small business owners would avoid getting hit with any income tax hike whatsoever. In fact, I’ve cut taxes for small businesses eighteen times since I’ve been President. And just this week, I ordered a series of new steps to help our small businesses grow and hire.
The only place we disagree is whether we keep giving tax cuts to the wealthiest 2% of Americans. Republicans in Washington want more of those tax cuts. With the deficit we have, I don’t think we can afford them.
But even if we disagree on the tax cuts for the wealthiest Americans, we all agree that no American should pay more taxes on the first $250,000 of their income. So let’s at least agree to do what we all agree on. That’s what compromise is all about. Let’s not hold the vast majority of Americans and our entire economy hostage while we debate the merits of another tax cut for the wealthy. Let’s skip the unnecessary drama, the needless delays and all the partisan posturing and let’s just do the right thing for the people who sent us here to serve.
And I’m going to keep fighting to make sure we rebuild an economy that rewards work, grows the middle class, and gives new opportunity to those trying to earn their way into the middle class.
Thanks, and have a great weekend.