Obama Might Not Repeal “Bush Tax Cuts”

I’d be thrilled to see Obama renege on this promise.

WASHINGTON – An economic crisis, rising joblessness and a credit squeeze can make a president-elect refine his words. Today’s word is “repeal.” During his presidential campaign, Barack Obama promised to repeal President George W. Bush’s tax cuts for the wealthy ahead of their scheduled expiration in 2011.

It was part of how Obama would pay for an overall net tax cut aimed at low- and middle-income taxpayers, and an effort to bring what he called “fairness” to the tax system.

No one is talking tax hikes now.

Over the weekend, Obama said he has charged his new economic team with devising a plan that would create or preserve 2.5 million jobs over two years. He said the plan would include broad spending plans as well as the middle- and low-income tax cuts he described during the campaign.

Aides later said the plan would not include any of the tax increases Obama, as a candidate, had said he would impose on taxpayers who make more than $250,000.

We don’t need a tax hike right now.  And lest you think that the so-called “Bush tax cuts” were just for the rich, remember these points:

- a new 10% bracket was created for single filers with taxable income up to $6,000, joint filers up to $12,000, and heads of households up to $10,000.

- the 15% bracket’s lower threshold was indexed to the new 10% bracket

- the 28% bracket would be lowered to 25% by 2006.

- the 31% bracket would be lowered to 28% by 2006

- the 36% bracket would be lowered to 33% by 2006

- the 39.6% bracket would be lowered to 35% by 2006

- The EGTRRA in many cases lowered the taxes on married couples filing jointly by increasing the standard deduction for joint filers to between 174% and 200% of the deduction for single filers.

- Additionally, it changed the rate of tax on dividend income starting in 2003 to 5% for those in the 0% or 15% brackets, falling to 0% in 2008. It was lowered to 15% for all other brackets.

- Additionally, EGTRRA increased the per-child tax credit and the amount eligible for credit spent on dependent child care, phased out limits on itemized deductions and personal exemptions for higher income taxpayers, and increased the exemption for the Alternative Minimum Tax, and created a new depreciation deduction for qualified property owners.

Are any of you benefiting from any of these provisions?  I thought so.  Do you consider yourself rich?  Obama apparently does. 

On a related note, this is going to get old:

Asked Monday when those hikes might go into effect, Obama said, “Whether that’s done through repeal, or whether that’s done because the Bush tax cuts are not renewed, is something that my economic team will be providing me a recommendation on.”

It’s good to get advice from people, but what the heck has Obama been doing for the past few months?  Presumably he advocated repealing the tax cuts because he thought it would improve the economy and Americans’ lives.  Is that not the case?  Was he advocating something that he knew would hurt the economy?  Is he capable of making a decision without a panel of prestigious advisers for cover?  Like I said… this is going to get old. 

In any case, Obama should make the tax cuts permanent.  It would do more for the economy than any of these bailouts.