Republican leader urges 2-year tax rate freeze

WASHINGTON Wed Sep 8, 2010 8:22am EDT

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WASHINGTON (Reuters) - House of Representatives Republican leader John Boehner called on Wednesday for a two-year freeze on all current U.S. tax rates, including Bush-era tax cuts for the rich set to expire at the end of this year.

Speaking ahead of an economic address set for later in the day by President Barack Obama, Boehner also proposed that the U.S. government cut spending for next year to 2008 levels -- before federal corporate bailouts and Obama's $814 billion economic stimulus plan.

Boehner's call for a freeze on tax rates amounts to a compromise with Obama in advance of November 2 congressional elections, which are expected to result in big Republican gains in the Democratic-controlled House and Senate.

Obama favors extending former President George W. Bush's tax cuts for the middle class, but allowing those for the wealthy -- people earning more than $250,000 a year -- to expire at the end of the year. Obama says the nation cannot afford to extend tax breaks for the rich.

Some Republicans have called for a permanent extension of the tax cuts, saying they are needed to spur economic growth. To cut some of them could dampen economic growth, they say.

Boehner made his pitch for the two-year freeze on all rates in an appearance on ABC's "Good Morning America," just hours before Obama was to speak in the lawmaker's home state of Ohio.

"If we're able to do this together, I think we'll show the American people that we understand what's going on in the country and we'll be able to get our economy moving again and get jobs growing in America," Boehner said.

(Reporting by Tom Ferraro and David Alexander; Editing by Will Dunham)

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Comments (6)
Mikeyh0 wrote:
You see? This is the kind of piecemeal, lame attempt at economic triage that will yield no benefit at all. The entire system must me dismantled. Period. The agencies that get taxpayer money are actually too numerous to count. The redundancy is wasteful. The public union people make way too much while those who pay their salaries are just getting by. Boehner doesn’t get it.

Sep 08, 2010 8:43am EDT  --  Report as abuse
mjimih wrote:
hey I got an idea, how about a two year moratorium on golf outings. Maybe Boehner could be a leader of the party of No Golf!

Sep 08, 2010 10:30am EDT  --  Report as abuse
alejandro81 wrote:
The entire American political apparatus approach to economics is predicated on the idea that there is an infinite supply of American debt the world will take. That may have been close to the old reality but the new reality is the world is done with financing our excesses.

I find it irresponsible to use tax cuts or tax freezes as an election tool, especially at this time. It shows how short-sided politicians can be when tackling the fundamental structural problems with the US economy. I`m sorry but offering tax cuts or freezes to the American public is a bit like offering cocaine to an addict so he`ll be happy.

I don`t think either Obama or Boehner are being realistic about the size of the austerity measures we need to take on. Maybe we should start by cutting the military budget. No more billion dollar jets and depleted uranium tipped missles please. After that we can tax and legalize drugs and stop sending $50 B a year to Mexico through the black market.

Sep 08, 2010 10:47am EDT  --  Report as abuse
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