MinnPost - Minnesota Democrats on Board with Obama Tax Plan

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By Devin Henry

President Obama's opening volley in the tax cut battle that will likely be the hardest-fought of this winter's lame duck Congress is largely in line with how Minnesota Democrats are approaching it.

Obama announced Monday he wants to extend the George W. Bush-era tax rates for those making less than $250,000 for one year. The tax cuts on high-income earners are scheduled to expire on Jan. 1, and Obama said his plan would provide an economic cushion to the middle class, while raising new revenues from wealthy Americans.

Republicans have long said, and affirmed again Monday, that they will only support an extension of the full tax cuts, including those for people making more than $1 million a year. Meanwhile, a group of congressional Democrats, including lawmakers like House Democratic Leader Nancy Pelosi and New York Sen. Chuck Schumer, had backed a plan that would have kept taxes low for those making up to $1 million, a significantly broader set of taxpayers than the one Obama focused on today. They backed off from that plan on Monday.

In the end, November's elections will likely set the tone for end-of-the-year negotiations on taxes. In December 2010, Congress passed a two-year extension of the complete slate of Bush tax cuts a month after a midterm election that swept Republicans into control of the U.S. House. Congress is unlikely to take up any major tax legislation until after this fall's elections, and that will dictate whether the taxes breaks are renewed in part (as Democrats want) or as a whole (as Republicans want).

But for now, Obama's plan jives well with Democratic members of the Minnesota congressional delegation, many of whom have voiced support for a $250,000 plan in the past.

A tax cut for that income bracket was a main component of the budget plan introduced by Rep. Keith Ellison's Congressional Progressive Caucus in March. On Monday, Ellison told MSNBC that he supported taxing those who make more than $250,000 and steering the savings toward either deficit reduction or reinvestments in the public sector.

"If you want to do something about deficit reduction, you've got to deal with serious amounts of money and that's the way to do it," Ellison said.

Rep. Betty McCollum,who has supported a $250,000 cut-off since at least the 2010 battle over the tax cuts, also voiced support for Obama's plan.

"It is fundamentally irresponsible to continue borrowing billions from China to give additional tax cuts for upper-income earners," she said in a statement. "The Bush tax cuts for the wealthiest Americans should expire at the end of this year."

Ellison and McCollum voted against the full extension in 2010, but Democratic Reps. Collin Peterson and Tim Walz supported the measure. Walz backed Obama's plan on Monday, calling the proposed tax cuts "fiscally responsible."

Rep. Collin Peterson, however, has been opposed to extending any of the Bush tax cuts since last fall's debate over the deficit, when, in November, he said the committee tasked with establishing the parameters of a deficit reduction package should commit to ending all the tax cuts, even for those making less than $250,000.

Peterson had no immediate reaction to Obama's plan Monday.

U.S. Sen. Amy Klobuchar joined her House colleagues in supporting the plan, calling it, "a balanced way" to reduce the deficit without hurting the middle class.

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