Thursday, April 17, 2014
WASHINGTON — As congressional leaders and the White House continue their high-stakes dance around the fiscal cliff, Maine's two Republican senators said Congress should at least extend tax cuts for middle-income families this year rather than risk pushing the economy back into recession.
Maine Republican U.S. Sens. Susan Collins and Olympia Snowe
Sens. Olympia Snowe and Susan Collins – both moderates known for their willingness to break with the party line – are among a growing number of Republicans suggesting that the threat posed by the fiscal cliff is too grave to risk a stalemate over tax cuts for the wealthiest Americans.
Congress could revisit the issue of taxes on the wealthy next year, the senators said. But both also argued that small-business owners need protection from tax increases.
"By focusing on (extending) the middle-income tax cuts that everybody agrees on and providing some assurances on the small-business side, we can take those issues off of the table," Snowe, who is retiring next month, said in an interview. "More than anything else, we have to build confidence – both market confidence and public confidence – because there is enormous skepticism that elected officials in the White House and Congress will be able to reach a consensus on these critical issues."
Economists worry that failure to address the fiscal cliff – $500 billion to $600 billion in automatic tax increases on most Americans and deep across-the-board spending cuts to take effect Jan. 1 – will trigger another recession next year.
The political posturing continued Wednesday even as the two sides resumed talks. President Obama warned Republicans not to attempt to drag the debate over raising the debt ceiling into negotiations on the fiscal cliff, saying "It's not a game I will play." Republican leaders, meanwhile, continued to bash the administration's latest fiscal cliff offer and called for serious plans to cut entitlements and spending.
But the momentum appeared to be shifting as Republicans heeded warnings – reinforced by recent polls – that voters will blame them more than Democrats if taxes on most Americans rise next year.
To up the pressure on Republicans, the White House released figures detailing how many families would be affected by a failure to reach a deal. In Maine, 500,000 middle-income households would see their income taxes rise, 122,000 families would lose access to the Child Care Tax credit altogether and 38,000 families would lose access to the American Opportunity Tax Credit for college expenses, according to the White House.
At this point, none of Maine's representatives to Congress are heavily involved in the high-level fiscal cliff negotiations. Collins and Snowe could play roles in any closely divided votes on a compromise, however.
Collins indicated she could support extending the income tax breaks on families earning $250,000 or less and individuals earning less than $200,000.
"Representative (Tom) Cole's (R-Okla.) proposal to proceed with an extension of tax relief for working families making $250,000 or less has merit because everyone agrees lower and middle-income families should not be subjected to higher taxes," Collins said in a statement to the Press Herald. "I believe that very wealthy individuals -- millionaires and billionaires -- should pay a greater percentage of their income in taxes to help us reduce the soaring deficit."
Collins voted earlier this year against a Democratic bill to only extend the middle class tax cuts. But she also voted against a Republican plan and was the only member of her party to support proceeding with a bill that would have imposed a new minimum tax on the super-wealthy.
Collins is also attempting to revive a proposal that would impose a 2 percent surtax on those earning $1 million or more. Co-authored with Democratic Sen. Claire McCaskill of Missouri, Collins' proposal would exempt or "carve out" many small-business owners who file their business taxes on their individual tax returns.
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