Republican Cantor opens door to tax hikes

Reuters via Yahoo ^ | July 6, 2011 | Andy Sullivan and Jeff Mason

[BradtotheBone]

WASHINGTON (Reuters) - A top Republican said on Wednesday his party could compromise on taxes as part of a broad budget deal as President Barack Obama warned the United States could spiral back into recession if Congress does not act soon.

Ahead of a Thursday meeting with Obama, House of Representatives Republican Leader Eric Cantor indicated that Republicans could break an impasse over taxes that has held up a deal to avert an early August default.

"If the president wants to talk loopholes, we'll be glad to talk loopholes," Cantor said at a news conference. "Any type of discussion should be coupled with offsetting tax cuts somewhere else."

Cantor's comments open the door to a compromise that would clear the way for Congress to raise the $14.3 trillion debt ceiling before the country runs out of borrowing capacity on August 2.

Failure to act by then could force the United States to default on debt service, retirement payments, or other obligations.

A U.S. default could cause "a whole new spiral into a second recession or worse," Obama told a Twitter town hall on Wednesday.

Cantor declined to say specifically what tax provisions would have to be part of the deal. An aide said possible elements could include an extension of last year's payroll tax break or a research and development tax credit.

[NativeNewYorker]

Not All Jews Are Smart.(tm)

[bray]

Dropping the loopholes to flatten and lower taxes is ok, anything else should get you fired.

Pray for America

[BubbaJunebug]

I sure don’t see Cantor saying tax increase in this article. Closing loop holes needs to be looked at.

[apillar]

Obama and the democrats are setting the trap and the Republicans are walking right into it. By breaking their no-tax pledge, they are writing the campaign commercials for their opponents in 2012 just ask George H. W. Bush, they are also taking the tax issue off the table as a hammer against democrats. If they attack Obama for supporting tax increases, all he has to do is come back and say it was the right thing to do and even they supported the increases.

[Tennessean4Bush]

If Cantor gives an inch they will take a mile, the line in the sand has been compromised.

Not sure I agree. He is firm on deficit reduction. In exchange for loophole closing, he wants offsetting tax cuts elsewhere. Looks like he took their talking points they were counting on for the next couple of weeks off the table. Look, there is no way they can pass any kind of tax legislation, even if they wanted, in the next few weeks. The move by Cantor merely keeps them on-subject which is deficit reductions, real cuts. IMHO, of course.

[screaminsunshine]

Unexpected? Did anyone expect the GOP would not raise your taxes...I mean enhance their revenue? I predict we will soon hear the dreaded word when we are about to be sold down the River. “Package”.
Be warned when you hair them start talking about a Package the fix is in. I wonder who will say it first? Normally it is a RAT.

[Tennessean4Bush]

Close loophole and offset with tax cut is a net tax increase?

[Retired COB]

Tell zero to get rid of the earned income tax credit. Also close loopholes for supposed non profits such as Media Matters.

I'm with you on the Earned Income Tax Credit. Has anyone come up with a total number of dollars that one is costing us????? If you're trying to cut the Federal deficit, the first place you should start is to quit paying tax refunds to people who don't pay any income taxes!

My personal belief is that we agree with Obama on the "Shared Sacrifice" concept....meaning that EVERYONE has to pay at least 5% of their income in taxes. That way the tax burden is shared beyond the upper earning 50% of people. The bottom 50% who don't pay any income tax won't lose any sleep if our taxes go up....but if everyone's taxes go up they tend to take it more personally.

[GonzoGOP]

Cantor going wobbly? What else is new?

Or setting a trap. From the article....

"If the president wants to talk loopholes, we'll be glad to talk loopholes," Cantor said at a news conference. "Any type of discussion should be coupled with offsetting tax cuts somewhere else."

So Obama can have his private jet tax, but he has to have an equal tax cut someplace else. But the goal is to balance the budget. And since any tax increase must under Cantor's law be compensated with a tax cut the only way to balance the budget is with spending cuts. And Obama won't do that. So it allows Cantor to look reasonable, but in reality still forcing Obama to agree to no "net" tax increases and large spending cuts.

Obama won't cut spending in any meaningful way so we still hit the cap like a ton of bricks. And that is actually what I want to see. As that is the only thing that might bring about real spending cuts.

[OrangeHoof]

I support raising taxes if coupled with hell freezing over.

[kabar]

What constitutes a loophole? If you “close a loophole,” you increase taxes, i.e., revenue. The is the same difference as calling an illegal alien an undocumented worker. Playing word games may fool some people, but it won’t fool the Tea Party. If the Reps cave, we need a third party. We may lose in the short run, but it is the only way we can break the stanglehold of the current one party establishment with two wings.

[9YearLurker]

Which is exactly what he’s saying.

I certainly understand cynicism re: Cantor, as he’s reliably wimped out in the past—but what he’s saying so far is reasonable.

[EQAndyBuzz]

I agree with that. Actually, close every tax loophole that exists. Why settle for a few items.

Congress should go line by line through the tax code and fix it. Seems like the only two people who have read the tax code is Ryan and Cantor.

[b4its2late]

Stupid move, but I expected no less.

[Owen]

The overall most important aspect to all of this is that IT MUST BE FRONT LOADED.

Do not come back to us celebrating some deal with $4 TRILLION over 10 years, and the FIRST YEAR’S CUT IS 20B. Any GOP congress member who comes back with that gets primaried. Period!

NO MORE BS. FY 2012 must be a 400B cut, minimum!

[Retired COB]

Congress should go line by line through the tax code and fix it.

I'd suggest that they start over and replace it with the Fair Tax.

[OldNewYork]

Oh, Cantor, we hardly knew ye.

[SeaHawkFan]

Wouldn’t read too much into this comment, yet!!!!

Depends on what he means by “loop hole”. If it means something similar to eliminating ethanol, wind, and solar energy subsidies; I’m all for it.

[muleskinner]

As usual, certain FReepers don't read further than the very misleading headline. Cantor says nothing about tax hikes, and I doubt the rest of the Republicans would go along with any hikes.

Yahoo via AP editor is a disturber.

[kabar]

Actually, close every tax loophole that exists. Why settle for a few items.

Give me some examples of tax loopholes. Mortgage interest? Depreciation? I guess the federal government has a right to every cent we make. They just must decide who to take it from, how much, and when.