President Obama signed the tax cuts deal into law Friday. While I didn’t agree with everything in the bill, I voted in favor of extending the tax cuts because increasing taxes by $3.9 trillion on Jan. 1, when we’re still in an economic downturn, would have been a bad idea.
President Herbert Hoover raised taxes during a recession and the U.S. sank further into the Great Depression. America and the world can’t afford our economy to worsen.
To be clear, I’m not in support of increasing the deficit or of everything that was included in the compromise; however, I believe it is critical that we restore order to our fiscal house. If this bill was the price we must pay to stop a $1,540 tax increase on an average middle-income family – Congress needed to support it.
Extending these tax cuts is important to not only preventing the stock market from tanking as a result of the lower capital gains tax rate expiring, but also to protecting the middle class. If these tax cuts were not extended, we would have seen higher capital gains rates imposed, the marriage penalty brought back, the child tax credit cut in half, the Alternative Minimum Tax be increased and the Death Tax would have been increased to 55 percent.
Individually, these are all bad tax increases, but taken collectively, we must ask ourselves how many more jobs would have been lost, if taxes were raised? Furthermore, in addition to increasing taxes on the middle class, these tax hikes would have been placed on small businesses – our job creators – so again, if we placed added burdens on our job creators, how many more jobs would we have lost? Too many have been lost already.
I’ve listened to you at town hall meetings throughout the Fifth District. Read your letters, emails and faxes. Received your phone messages. I get it. Wisconsinites want jobs. They want their family members and friends to get back to work. They want to see economic growth. They want to see more jobs created, which will in turn produce more tax revenue. They do NOT want higher taxes.
The compromise isn’t ideal for everyone. However, not raising taxes – and thereby killing more jobs – is a good place to start.
As I’ve said before, I don’t think tax cuts are the end-all-be-all solution to our economic woes, but they do offer a positive new start to turning this economy around and providing some certainty in a time of economic uncertainty. From there, we can then focus on cutting unnecessary spending and reducing the size of government. With our nation and our people hurting, it only made sense for Congress to renew these essential tax provisions –so that we can help our families, as well as our job creators more quickly.
U.S. Rep. Jim Sensenbrenner represents Wisconsin’s Fifth Congressional District.