Democrats Against Stimulus—and Jobs
Senior Editor, CNBC.com
This is pretty depressing.
It seems that the Obama administration is so caught up in its own class-warfare rhetoric that it prefers continuing to hold the Great Recession over Republicans, to cutting taxes on businesses.
This week the Republican-led House passed a 20-percent tax cut for companies with fewer than 500 employees. The vote was almost strictly party line, passing 235 to 173. The Obama administration is threatening to veto the measure. But it probably won't even pass the Senate, where the Democrats are in control.
Why veto a tax cut at a time when the economy remains mired in high unemployment?
In issuing its veto threat, the White House complained that almost half of the tax benefits would go businesses with annual revenue of more than $1 million each. No tax cuts for millionaires!
There's not really room for doubt that the tax cut would spur employment. It may not be the perfect vehicle for accomplishing this, but it will do the job. Reducing the amount of money the government taxes out of the economy means people will have more money to spend and invest. As consumption and money available for expanding businesses increases, employment will also. It's hard to believe that the Obama administration, which argued so forcibly for stimulus spending two years ago, does not understand this basic logic.
I'm pretty sure that they do understand the logic. They're just choosing more unemployment to score political points.
Like I said: pretty depressing.
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