September 7th, 2010
10:03 AM ET
4 years ago

Orszag Breaks With Obama on Bush Tax Cuts

 President Obama’s former budget director, Peter Orszag, wrote Tuesday that the Bush tax cuts should be extended for two years.
President Obama’s former budget director, Peter Orszag, wrote Tuesday that the Bush tax cuts should be extended for two years.

(CNN) - Former White House Budget Director Peter Orszag is breaking with President Obama on the controversial election-year issue of whether the Bush tax cuts for the wealthy should be scrapped, declaring in a New York Times op-ed that failing to extend the tax cuts for the rich would "make an already stagnating jobs market worse over the next year or two."

To be sure, the crux of Orszag's argument is not complete music to the ears of Republicans because he's proposing a compromise by which all of the Bush tax cuts are extended for two years but then will be ended altogether, something the GOP does not want to endorse.

CNNMoney.com: Orszag: Extend Bush tax cuts for 2 years

But the more sensational part of Orszag's first column for the New York Times is that he is urging the president he worked for just a month ago to sign on to allow the tax cuts for the wealthy to continue in the short-term, borrowing a line of reasoning Republicans are using on the campaign trail.

"Higher taxes now would crimp consumer spending, further depressing the already inadequate demand for what firms are capable of producing at full tilt," Orszag writes in the new occasional column he will write for the New York Times. "And since financial markets don't seem at the moment to view the budget deficit as a problem - take a look at the remarkably low 10-year Treasury bond yield - there is little reason not to extend the tax cuts temporarily."

White House aides were quick to make clear that Orzsag's advice will not change the president's view that the tax cuts for the rich need to expire at the end of the year in the name of fiscal discipline.

"The president has been clear about his support for extending tax cuts for the middle class and about ending the tax cuts for the wealthiest 2 percent of Americans, which would cost $700 billion over ten years to extend at a time when we are dealing with a fiscal crisis and the independent (Congressional Budget Office) has listed as the least effective form of growing the economy," White House spokeswoman Amy Brundage told CNN.


Filed under: Economy • issues • Peter Orszag • President Obama • Taxes
soundoff (77 Responses)
  1. Bill Yost

    As the economy slowly sinks, more rats will be jumping ship on the Obama Cruise Lines!

    September 7, 2010 11:12 am at 11:12 am |
  2. rdepontb

    Peter,

    I understand that you still want to stay somewhat relevant. Or, at least be relevant, which it appears you were not in the Obama White House. You're a little nerd kid, stuck in some wonderland of theories of socio-cultural economic world that has really never existed.

    Why should _anyone_ expect that the rich would return any monies to the workaday world? Look at what the banks and other lending institutions, and corporations for that matter, are doing with their growing treasure chests-they are hoarding the money. They are _not_ lending it out, not starting new ventures, not hiring, period. Clearly, they want theirs while they can get it, and to heck with the rest of this great nation.

    Good riddance.

    September 7, 2010 11:13 am at 11:13 am |
  3. TOTUS 4 PRESIDENT

    Wow, the semi-intelligent ones have lept from the sinking ship Obama, leaving the stupid ones whose only tools are those that have clearly and miserably failed while they keep hoping that a miracle will happen.

    September 7, 2010 11:13 am at 11:13 am |
  4. AFSOC 1st Sgt

    "White House aides were quick to make clear that Orzsag's advice will not change the president's view that the tax cuts for the rich need to expire at the end of the year in the name of fiscal discipline."

    When referring to the Obama administration, aren't "President's view" and "fiscal discipline" mutually exclusive terms?

    September 7, 2010 11:15 am at 11:15 am |
  5. larry

    Peter Orszag is a stupid dirt bag. The tax cuts for the rich are what got us in trouble in the first place. Let's take a look at his tax return. I'd bet my house, if I still had one, that he's a rich dude that has been benefiting greatly by the tax cuts or that he's a lobbyist for the rich. Either way, he's getting more money in his pocket.

    September 7, 2010 11:15 am at 11:15 am |
  6. Chuck

    Too funny. This is a body blow to Barack Inane Obama's economic plan – whatever that is. hahahahahahahaha.

    By the way – in reference to Inane's bellyaching about being talked about like a dog...to paraphrase the highly esteemed dumbocrat Harry S. Truman...if you can't stand the heat (you know the rest).

    Obama is a big baby. A thin skinned, spoiled brat, big-mouthed baby. With all the insults GWB took from the arses on the left, he never cried about. Bush has infinitly more class and grace that the boob Obama.

    September 7, 2010 11:16 am at 11:16 am |
  7. Todd

    This CNN article seems to argue that Orszag favors extending the tax cuts for the rich, yet in the second paragraph of Orszag's editorial, he states:

    "In the face of the dueling deficits, the best approach is a compromise: extend the tax cuts for two years and then end them altogether. Ideally only the middle-class tax cuts would be continued for now. Getting a deal in Congress, though, may require keeping the high-income tax cuts, too. And that would still be worth it."

    Seems that Orszag's favored position is that we should only extend the middle class tax cuts, and he only agrees to extending the tax cuts for the rich in order to get a couple of Republicans on board.

    September 7, 2010 11:16 am at 11:16 am |
  8. Marry

    The GOP screams about the deficit but does not want to pay a fair share to pay for the cost of running a country. Trickle down… we had that for all too long. It seems the rich are really determined to make “The President fail”.
    Funny, they did not seem to care about spending of the books to destroy a country (and the lives of thousands of people) but now have a big problem to spend some to rebuild the USA after decades of neglect. Most incredible that too many people fall for their one liners and consider voting against their own interests.

    September 7, 2010 11:19 am at 11:19 am |
  9. Anonymous

    Mr obama i would take a good look at your staff and fire who is for gop ideas good god get rid of gates he is a gop lover

    September 7, 2010 11:24 am at 11:24 am |
  10. Dennis

    If course the Republicans do not want to eliminate them, even though they have failed to deliver on their much touted benefit. Increase JOBS!!! After the BUSH tax-cuts, how many jobs were created? NONE!!! How much jobs were LOST? 8,000,0000!!!!!! Really tax cuts for the rich creates job????? Go on believing that LIE middle class america. What really was created? Billionaires out of millionares. HUGE BONUSES for corporate executives who contribute to politicans to keep them in power, so the middle class can bail them out so they can keep their HUGE BONUSES, so they can contribute to policitians. See the circle here folks. Follow the money trail. I am sure it does not end them all the hard working American people. And people the REPUBLICAN PARTY is NOT working for you. BELIEVE IT.

    September 7, 2010 11:24 am at 11:24 am |
  11. Clwyd

    No tax cuts for the Rich, Big Oil, Big Business or Wall Street! I voted for Obama to stop the abuses of the republicans and the Bush administration for 8 years. Now this guy wants to go back to the rich getting richer and we having homeless now in our little town thanks to the mess that bush and the republicans put us in economically!

    September 7, 2010 11:26 am at 11:26 am |
  12. Texas Progressive

    I've read .1% of the population receive over 50% of the Bush tax cuts. That's "point" one percent – not one percent! This level of disparity in distribution of wealth is out of control. Republicans clearly pander to the economic elite in continuing to promote trickle-down economics – a plan that never actually works. In no way would the top .1% suffer or sacrifice anything if forced to pay a fairer share toward a country that has treated them so well.

    September 7, 2010 11:27 am at 11:27 am |
  13. Fair is Fair

    Poor guy... he's giving an honest appraisal of the situation and the left is going to rip him a new one because he dares to disagree with the annointed one. No wonder he left his position.

    September 7, 2010 11:27 am at 11:27 am |
  14. jules sand-perkins

    Extend the Bush tax cuts for those who have done the hardest work: the wealthy, a.k.a. "the workers."
    Stop giving money to those who have never worked but are expected to vote for President Obama out of gratitude for their and their babies' checks.

    September 7, 2010 11:29 am at 11:29 am |
  15. Chas in Iowa

    The rich have not created any new jobs since they were given the windfall tax break. Why should we continue giving the rich this windfall? Hoping they will hire new workers after all these years of enjoying there big gift from the previous administration while shipping our jobs overseas and to Mexico?
    They want to keep the big tax break?,......show me the jobs!!!!!

    September 7, 2010 11:30 am at 11:30 am |
  16. Emilio

    Since the Bush tax cuts have put us in a precarious position already, the two year extension proposed by Orszag should finally cripple us. The doctrine of Republicans is the continued destruction and enslavement of the working classes. Obama picked a bunch of Republicans for his cabinent and their policies have led him into a position he will not be able to escape: a failed presidency.

    September 7, 2010 11:31 am at 11:31 am |
  17. s. cohen

    Let the tax cuts sunset as the legis. Was written,keep the under 250 in place. It is not a tax increase for the wealthy,just a return to what they paid 10 years ago.Don't forget the bill was a temporary measure.

    September 7, 2010 11:31 am at 11:31 am |
  18. Common Cents

    Sounds like more conservative propaganda: Tax Cuts for the Wealthy, Reduce the size of Government, Don't raise taxes, blah, blah, blah!

    I'm getting sick of hearing the same old retoric! Where's the champion for the Middle Class?!?

    September 7, 2010 11:31 am at 11:31 am |
  19. Robert

    He also said: In the face of the dueling deficits, the best approach is a compromise: extend the tax cuts for two years and then end them altogether. Ideally only the middle-class tax cuts would be continued for now. Getting a deal in Congress, though, may require keeping the high-income tax cuts, too. And that would still be worth it.

    Clearly, he agrees with the Admin.,

    September 7, 2010 11:32 am at 11:32 am |
  20. Bruce

    This is nothing new. We all know how the leftists in this country feel. the problem is they are to stupid to understand economics. Sure go ahead and take as much money from ent rich you want. In return you will get job stagnation and no recovery. Most liberals that I know are just jealous because they DON'T have money. I guarentee you if the shoe was on the other foot no way would a liberal or anyone else for that matter, want to part with their money. I sure don't see all the rich liberal politicians offering to give money back. And even if Obozo does manage to get the tax cut for the rich axed, I bet you my paycheck he'll figure out a way to make sure it doesn't affect rich politicains.

    September 7, 2010 11:33 am at 11:33 am |
  21. Mike

    Watch out folks, the koolade is wearing off fast.

    September 7, 2010 11:34 am at 11:34 am |
  22. zedlok

    he makes a good point that debt is cheap right now. but consumer demand large enough to jump start the economy isn't going to come from the top 2%. its just kicking the deficit can down the road.

    September 7, 2010 11:35 am at 11:35 am |
  23. LIP

    As much as the Democrats love to condemn the wealthy 2 %, they are still the people that provide many of the jobs that employ the unemployed. They are still the people that dump tons of cash into the system that employs the unemployed. It only stands to reason that we need to incentivive them into spending the cash and creating jobs.

    September 7, 2010 11:35 am at 11:35 am |
  24. Ray E. (Georgia)

    Extend the Bush Tax Cuts for 4 more years or make them permanent. Cut spending to what the Treasury takes in minus 1 percent to pay down the Debt. Then employment will come back slowly. Anything else is just Whistling in the wind.

    September 7, 2010 11:36 am at 11:36 am |
  25. Roger

    Wow, did one of Odumwa's trusted consorts finnaly see the light at the end of the hole that Odumwa and the Dummycrats have put the USA in?

    September 7, 2010 11:36 am at 11:36 am |
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