Cliffs and gravity can be a deadly combination in Utah, where treacherous footing can precipitate bad falls with nasty or sometimes even fatal results. Knowing the consequences of such falls, most backpackers hiking Timpanogos, Olympus or other Utah mountains stay as far away from precipices as possible. They would rather be safe than sorry – or worse.
Unfortunately, a more reckless attitude prevails in Washington, where the White House and its Capitol Hill allies are playing a high-stakes game of political brinksmanship instead of acting in good faith to solve our fiscal problems, even with our nation on the verge of sliding back into serious recession.
The looming crisis is called “Taxmageddon,” the fiscal cliff that threatens Utah and the rest of the nation at the end of the year unless the White House and Senate Democrats quit stalling and start working with Republicans to address looming tax issues.
One of those issues is to make permanent or extend the tax relief enacted by President Bush and extended by this President in 2010. If that does not happen, Utahns and other Americans will be hit with the largest tax increase in history – about $310 billion next year alone.
Another is the alternate minimum tax (AMT) patch, which has expired. The AMT was originally enacted to prevent 155 wealthy taxpayers from using loopholes to avoid paying taxes. Since the AMT is not automatically updated for inflation, however, it ensnares more people every year. In 2013, 31 million middle-class families will face a $92 billion tax hike unless this stealth tax is repealed or the patch fixed.
A family of four, earning $50,000 per year, will get clobbered by a $2,183 tax hike. Small-business owners will face a top marginal tax rate hike of 17 percent. Moreover, the number of small business owners and farmers confronted by the punitive and onerous death tax will soar by 900 percent.
Combine these massive tax hikes with our nation’s out-of-control debt and the coming budget cuts from the sequester plan that followed the Administration’s failure to arrive at a budget, and it is more than enough to send our teetering economy careening over the edge and back into recession.
As the ranking member of the Senate Finance Committee, I know that must not be allowed to happen. That is why I, joined by my Senate Republican colleagues, wrote to Senate Majority Leader Harry Reid, urging him to work with us to prevent Taxmageddon. I also continue to press the Administration and leaders of the Senate majority party at every opportunity.
My message to the President and Senate Democrats is simple: There’s no greater jobs program that Congress and the President could do than permanently extend this tax relief. It would provide confidence to American families and businesses at a time when confidence is sorely lacking. It also would provide small-business owners with the certainty they need to hire more workers and get our economy moving again.
And mine is not a lone voice in the wilderness.
Even some of the President’s supporters are calling for action. Earlier this month, former President Clinton told CNBC it is imperative to act now, not later, to avoid the pending fiscal crisis. At a minimum, he added, there should be a temporary extension of the tax relief. And Larry Summers, former director of the National Economic Council, and others have echoed those concerns.
So what’s the holdup? Why are the President and his allies dawdling on non-starter proposals such as the Buffet Tax that incite class warfare and don’t begin to solve our fiscal crisis? I believe the answer is that he and his advisors don’t want to extend tax relief to everyone because their liberal base does not want it extended for anyone. They want to drag this out until after November and raise taxes on every American – something the President dare not announce until after the election.
Well, the Utahns I talk with are not fooled. They know the President is laying low instead of leading on this issue. Like Americans everywhere, they see the fiscal cliff before them and are not content to take the fall so this White House and can score political points and raise taxes. I will continue to fight, along with my colleagues this summer, to see that they don’t.
Sen. Orrin G. Hatch, R-Utah