Clinton’s Tax Talk Echoes in Capitol

Photograph by Samuel Kubani/AFP/Getty Images

Former President Bill Clinton during the 20th Life Ball on May 19, 2012.

Bill Clinton said it — sort of.

Republicans are happy to repeat it — for sure.

The former president’s comments in an interview this week that Congress “will probably have to put everything off until early next year” when it comes to the question of extending the Bush-era tax cuts are playing well in Republican quarters on Capitol Hill.

(Never mind that Clinton spokesman Matt McKenna moved quickly to clarify those comments, saying Clinton “does not believe the tax cuts for the wealthiest Americans should be extended again;” it’s just that he doubts a long-term agreement on taxes and spending cuts can be reached until after the fall elections play out.)

“Even Bill Clinton came out for it before he was against it,” House Speaker John Boehner said today, echoing the words that Republicans had for Senator John Kerry of Massachusetts when he was running for president.

Boehner, an Ohio Republican, says extending the current tax rates for at least another year would help “provide some certainty to job creators.”

“Coupled with Bill Clinton’s remarks” and those of former Treasury Secretary Larry Summers, “it’s pretty obvious that the economy needs the certainty of the extension of the current tax rates for at least a year,” Senate Republican Leader Mitch McConnell told reporters today. “The growth rate now is actually slower than it was in December” of 2010.

Summers, who served as Treasury Secretary under Clinton and as a White House economic adviser to Obama, said today in an appearance on MSNBC: “We’ve got make sure that we don’t take the gasoline out of the tank at the end of this year… That’s got to be the top priority. We’ve got to make sure that we keep providing energy to the economy.”

In a separate interview on Bloomberg Television, Summers said the U.S. should borrow more money now because of historically low interest rates.

“There’s a huge opportunity for the government to take advantage of those low rates, to make investments that actually will pay off for the budget over the long term,” he said.

Federal Reserve Chairman Ben Bernanke has warned of a “fiscal cliff” at the end of the year because of tax cuts on wages, capital gains, dividends and estates that former President George W. Bush won in 2001 and 2003 that are scheduled to lapse. (Congress already has extended them, voting at the end of 2010 to give them another two years, after President Barack Obama conceded that he couldn’t retire some of the tax breaks — Obama has maintained since April 2011 that he will oppose further extensions for high earners.)

“What I think we need to do is to find some way to avoid the fiscal cliff,” Clinton said in an appearance on CNBC this week, “to avoid doing anything that would contract the economy now and then deal with what’s necessary in the long-term debt reduction plan as soon as they can, which presumably will be after the election.”

His words were received warmly by Republicans.

“Bill Clinton and I disagree on many things, but when it comes to stopping this massive tax hike on Jan. 1, we agree,” said Senator Orrin Hatch of Utah, the top Republican on the Senate Finance Committee. “It’s my sincere hope that President Clinton’s call for action will spur this president to finally lead and prevent the larges tax increase in history, a tax increase that would devastate our already weak economy.”

The Republican-led House is planning to vote on a one-year extension in July, and lawmakers are considering a fast-track procedure for a tax overhaul.

 

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