The Financial Times profiles a private meeting held by Senator Max Baucus (D-MT) last Thursday, and how discussions over extending the Bush-era tax cuts are causing a split in the Democratic Party.
Mr Baucus – along with Harry Reid, Senate majority leader, and Ms Pelosi – will have to strike a difficult compromise in the coming months. As well as the renewal of the tax cuts, other sensitive issues, including the reinstatement of a 45 per cent estate tax that lapsed last year, could also be addressed in a single bill that could emerge from the Senate finance committee in September, after the summer recess.
UPDATED: More Senate Democrats are joining a Republican chorus of keeping the Bush tax cuts in place. According to Thursday’s Wall Street Journal, Sen. Ben Nelson (D-NE) and Sen. Kent Conrad (D-ND) said taxes, even on the wealthy, should not be allowed to rise until the economy is on a more sound footing.
More from that Wall Street Journal report:
They are the second and third Senate Democrats to come out publicly in recent days in favor of extending all the tax breaks for the time being. Sen. Evan Bayh (D., Ind.) made similar comments last week.
“As a general rule, you don’t want to be cutting spending or raising taxes in the midst of a downturn,” Mr. Conrad said. “We know that very soon we’ve got to pivot and focus on the deficit. But it probably is too soon to cut spending or raise taxes.”
Earlier this week, “The Hill” cited a staffer to Sen. Max Baucus (D-MT), reporting that efforts appear to be underway in Congress to extend portions of the Bush tax cuts ,specifically those targeted at the middle class.
Here’s an excerpt of that report:
Senate Finance Republicans last week urged Committee Chairman Max Baucus (D-Mont.) to mark up legislation on the Bush tax cuts to strengthen consumer confidence in the economy.
The idea gained momentum Monday after a Baucus staffer agreed with Republican counterparts that a markup should occur before lawmakers adjourn for the summer break, several sources told The Hill.