By Senator Jim Demint
Many of you have contacted me about the bipartisan tax deal reached between President Obama and Republican leaders. I’ve carefully reviewed the legislation and I wanted to explain to you why I cannot support it.
First, I do not want to see anyone’s taxes go up and I have been fighting for years to permanently extend all the tax rates. I disagree with the President that we cannot afford to extend these rates for everyone. It’s the people’s money and we should not raise taxes on hardworking American families.
But this bill does much more than simply extend tax rates.
For starters, it includes approximately $200 billion in new deficit spending and stimulus gimmicks. That’s a lot of money that will have to be borrowed from China and repaid by our children and grandchildren. If we’re going to increase spending on new programs, we must reduce other spending to pay for it.
The bill also only extends rates for two years. We don’t have a temporary economy so we shouldn’t have temporary tax rates. Individuals and businesses make decisions looking at the long-term and we’re not going to create jobs without giving people certainty as to what their taxes will be in future.
The bill also fails to extend all of the tax rates. It actually increases the death tax from its current rate of zero percent all the way up to 35 percent. One economic study shows that this tax increase alone will kill over 800,000 jobs over the next ten years.
Finally, the bill now includes dozens of earmarks for special interests, including ethanol subsidies, tax breaks for film and television producers, give aways for Puerto Rican rum manufacturers, favors for auto racing track owners, and a hand out for businesses in American Samoa.
The President called Republicans “hostage takers” this week but he should be pointing his figure squarely at himself. We’ve known for years that these tax rates were going to expire but he did nothing about it until the last minute. Now Americans are being told they have to accept hundreds of billions in new spending and stimulus gimmicks, an increase the death tax, and a bunch of unnecessary earmarks or their taxes will go up.
I’m not going to be bullied into voting for things that will hurt our country because politicians in Washington ignored the problem until it was a crisis.
Many of you fought hard to elect new leaders to the Senate this year with the expectation that they would fight deficit spending, tax hikes, and backroom deals. I take that commitment very seriously and I’m prepared to vote against this bill even if I’m the only one in the Senate to do so.
I appreciate the efforts made by my party’s leaders to negotiate this deal but I believe Americans deserve much better. This deal should be rejected and then fixed. We can easily extend these tax rates without increasing spending once the new crop of Republican senators, including Pat Toomey, Marco Rubio, Rand Paul, Mike Lee, and Ron Johnson, are sworn in. The President has already conceded that taxes cannot go up and we’ll have more Republicans in Congress in a few weeks to fight for a better deal.
Thank you for supporting the principles of freedom and for your continued encouragement. I will continue to do my very best to be your voice in the United States Senate.
United States Senator
Chairman, Senate Conservatives Fund