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Webb Praises Tax Cut Compromise at Chamber Event

by ARLnow.com December 10, 2010 at 4:56 pm 2,043 33 Comments

Speaking to the Arlington Chamber of Commerce this afternoon, Sen. Jim Webb (D-Va.) expressed strong support for the tax cut deal between President Obama and congressional Republicans, calling the compromise “an act of leadership.”

The keynote speaker at the Chamber’s 86th Annual Meeting, Webb said he’s encouraged by the president’s willingness to break with the Democratic base.

“What the president has done here is something I’ve been waiting for him to do for a long time, and that is to get out of the base of the party and move into where we need to be as Americans to solve the problems that we have,” Webb said. “There are things in here for everybody not to like, but that’s just what happens when you get into this business.”

Obama’s tax proposal calls for a two-year extension of the Bush tax cuts for all income brackets, a 13-month extension of long-term unemployment benefits, tax breaks for business investments, a weakening of the estate tax, and a 2 percent payroll tax production. Since the compromise was announced, the president has had to fight off criticism from members of his own party, who say the deal is costly and a boon for the rich.

“It’s not a totally popular position inside our caucus at the moment, but I think we really do need to get this done for the good of the country,” Webb said. “It’s not a Republican issue, it’s not a Democratic issue, it’s an issue of how we get our economy going.”

Webb said lower taxes and continued unemployment benefits have the potential to greatly benefit the economy. In explaining why, he adopted the economic rationale cited by many Republicans.

“What all this has the potential of doing, in my view, is to stimulate our economy in a way that the TARP did not, and these other programs did not, because it’s going to put money directly in the hands of people who will spend it,” he said. “Study after study has shown that when you put money into unemployment benefits, it’s one of the fastest ways to recirculate money in your economy, because people aren’t going to hang on to it, they’re going to go out and spend it.”

Webb said simply allowing the Bush tax cuts to expire in January would be a mistake.

“People who don’t like this, I’m not sure they’re going to like what happens if they don’t pass it,” he said.

During the course of the speech Webb also questioned the wisdom of political maneuvering by the Democratic leadership in congress during the current lame duck session.

“Frankly and honestly, I really don’t think that it was a smart thing for our leadership to require us to take a whole series of symbolic votes that we knew we were going to lose,” Webb said.

  • Set the controls

    Bush always governed by sticking by his base, and like him or not, he usually got his way. Misguided fortitude is still misguided.

    • brian

      bush went against his principles in bailing out gm.

      whatever man.

    • mehoo

      A stimulus (yes, Bush passed a stimulus before Obama’), the GM bailout, the bank bailout, a huge new healthcare entitlement (Medicare Part D) — all Bush. Yeah, right, his base.

  • el fat kid

    remember when Jim Webb had principles? neither do i…

  • Sam

    As a small business owner struggling to make ends meet; I saw “THANK YOU!”. Even though my business generates over $250,000 a year, I am FAR from rich. I pay staff that I just can’t lay off because I’d feel horrible, so I took a job to help pay the bills and make sure my staff didn’t lose their jobs.

    Even though some people have this idea that this compromise and the tax cuts were for the rich – it’s just not the truth. It really does help those like me – the extra money I don’t have to pay will help me help my staff and give them a raise. And I’ll keep working until the economy gets better and I can just have the one job; running my business.

    • KalashniKEV

      Sam, I salute you, and your story makes me proud to be an American. It’s sick that so many of our neighbors would penalize your drive and the success you’ve achieved, and use it to mitigate the failure of others less motivated, clever, or hardworking.

      The Dems are expert at downplaying the Facts and spinning up emotion. Your story proves that in the real world, noble sacrifice, hard work, and honesty are what gets you ahead and makes this country great… Plastic Jesus isn’t going to reach into your fellow American’s pocket, hand over his wallet, and everything is going to be moral and OK. If he says so- it’s a lie. If you believe him- you’re a fool.

      This wasn’t a compromise- it was a surrender in lieu of complete destruction. Anyone in Congress who opposes the compromise should be happy about the unemployment benefits… they’re going to need them soon!

    • Thes

      Salaries paid to employees are a business expense and are not taxed. Only profits and other payments to the business owner are taxed. This “personal story” does not make any sense.

      • Thes

        Of course, I meant salaries paid to employees are not taxed as part of corporate or proprietor income, not that the employees don’t have to pay taxes, or that there isn’t FICA. The point is that a business owner who merely “generates” $250k per year was still under Obama’s promise of tax protection as long as, after expenses (including employee salaries) the business owner himself wasn’t going to get more than $250k in his pocket. It’s the difference between “gross” income, which is not taxed, and “net” income, which is.

        • jan

          Thes, thank you.

        • Sam

          Wow, clueless. Salaries for employees are taxed. I pay unemployment tax, in addition to what’s withheld from their paycheck, I pay a percentage on top of that – all of us do. It’s the law – look it up.

          I also pay a percentage of the social security and medicare taxes on top of what’s withheld.

          I also pay worker’s compensation insurance that goes up the more I pay them – look it up.

          And, considering most of us are either S Corps, or LLC’s – all income is passed through as personal income. Look it up.

          Only some items can count as business expenses; and due to the tax code, it’s not dollar for dollar expense for deductions.

          Even a $2000 a year tax prep fee (just for tax prep, doesn’t include all the hourly charges for bookkeeping or advice) from a well respected accounting firm can’t get you every penny back that’s paid in.

          • 4Arl

            I think the general proposal from Democrats had been to extend the existing tax rates on the brackets below 250k. Federal income tax rates are applied on a marginal basis, so the increased taxes would have applied to only the amount of income over 250k- if you earned 300k the higher rates would have applied to the top 50k. But you are right that your overall taxes would have be higher in that case. At the same time, I’d encourage folks to look back at the budget tricks from Bush/Congress in 2001 and consider the way the tax cuts were written to self-destruct and expire now.

        • NorthAdams

          ALL INCOME is taxed in Arlington. It is a GROSS RECEIPTS TAX — which means you pay tax on all income (not just your profit). So the money that is left over and paid to employees has ALREADY BEEN TAXED.

          • Alan Greedscam

            What has the Gross Receipts Tax in Arlington got to do with the Federal Income Tax on individuals?

    • i call bs on sam

      As Thes points out, the $250,000 threshold has nothing to do with gross sales. You need a better tax accountant. Most small businesspeople I know pay themselves a salary from the business, in addition to salaries or hourly wages for employees and then the other expenses, and those costs are deductions that go into profit/loss statement. BUSINESS taxes are on company profit. The income taxes we’re talking about with the tax cuts are about personal income tax, not BUSINESS taxes. If you have a small business and can still pay yourself a salary of $250,000 or more, and still show a profit from the business, you have nothing to whine about.

      • Sam

        BS all you want – but if you actually knew small business owners who did something other than ran a consulting business and had no employees, you would know that the FACT is that ALL income from a LLC or an S Corp is passed through as personal income. Then,

        And, most small business owners DO NOT pay themselves salaries – those that do pay themselves a nominal amount. I could pay myself, then 5 people would lose their jobs. I could stay in my store all day, every day – I would love it. But then 5 people would lose their supplemental income; 3 of them who use it to pay for college.

        How about you tell them that I am just the stupidest small business owner on the planet and have the worst accounting firm doing my taxes so that’s why they have to find another job.

        I’m sure their opinion would differ –

        • el fat kid

          wow… you really need to hire an accountant and tax attorney, it will be well worth your time to invest in a decent one. that is of course if anything you say is true which, as others have pointed out, is highly doubtful.

          • Jim

            dude – you are a lawyer – not a small business owner. stop pretending you know everything, cause you don’t.

          • el fat kid

            nope…

    • mehoo

      Sure, but we could still have actually taxed the rich and super-rich and generate lots of revenue and still let you keep your tax cut. That’s what the Dems wanted to do.

  • Justin Russo

    Yes, a 4% rise in marginal income above $250,000.00 is sure to destroy the economy.

    • el fat kid

      you remember what those tax levels did to the economy during the Clinton years? absolutely horrific.

      • mehoo

        Yeah, and that deficit during the Clinton years too, just through the roof!

      • PikeHoo

        Maybe we can bring George W. Bush back on as a consultant to advise us through the recession?

      • Burger

        Who was in charge of Congress?

        • mehoo

          Yes, who?

      • Another Driver/Traveler

        The only reason that things were good in the Clinton years was the set up of the 80’s and the fact that the Republican Congress fought/worked with him to cut spending.

        • mehoo

          Cool, so the only reason we have a horrible recession now is because of Bush.

          We can do this all day.

  • Pingback: Moran vs. Webb vs. Obama « ArlingtonGOP()

  • MB

    Webb has pretty much abandoned the rhetoric that got him elected. Shocker, I know.

    ~

    Sam’s story is, like many many others I’ve seen around, unbelievable on its face. I’ve been seeing a lot of horror stories about small business and taxes, and every one of them appear to be able to be solved by a competent accountant. I don’t doubt that there are some awkward and unfortunate situations out there, but it’s worth taking a hard and skeptical look at those we’re hearing in this round.

    • Burger

      Absolutely right. I am against tax increases but Sam story seems to lack a level of honesty. First, most business owners don’t have time for a second job to pay the salaries of their workers, most are trying to build their business or perhaps Sam is just a crappy businessperson that is inefficiently using his/her time.

      Second, the 250K tax increase – which would be lower than if the Clinton rates and levels were instituted – is on profit that then passes through to a single person if it is set up as a LLC or S corp. It is also on the margin rate increase.

    • Billybob

      I’ve been waiting and waiting and waiting for somebody (Democrats? Anybody awake in there???) to point out the BS that the right is feeding its base about this huge tax increase on small businesses, which is NOT. I run small business here in Arlington and none of what the president has proposed would affect me in the slightest. My accountant (read: wife) and I both know that BUSINESS EXPENSES LIKE SALARIES ARE NOT TAXED, only profits are taxed. If my business grows such that I need to hire people to cover the demand, and I can still make money by hiring someone, then I’D BE AN IDIOT NOT TO DO IT, REGARDLESS OF MY TAX RATE!!! Now if you quibble about what percent tax you pay on your profit, and that paying a few percentage point more in tax just makes you mad enough not to make more profit, then that’s your (stupid) decision. If so, please send your customers my way!

  • Jim

    Webb will be defeated on the left or right — but either way, he won’t be a senator come 2013.

  • HelpUsAll

    I agreed with this tax/unemployment package (which just passed last night, by the way, both houses and headed to the Prez’s desk) because of the Unemployment Comp extension, which is badly needed by the chronically unemployed. The long-term unemployed are in bad enough shape, even with the benefits. Many would be hungrier and homelss without those benefits. It’s pretty sad when you have to basically bribe the Repubs to care about the average working person, but if it has to be done, so be it. I’m not fanatical about charging the rich more just because they can afford it, although it is ironic that the party of borrowing billions for unjustified oil wars now wants to reduce deficit spending on the backs of reducing emergency help for the poor and unemployed. As for Webb’s 2012 prospects, I think he won the 2012 election when he got the GI Bill passed. He’s one of the few Senators who actually delivers, especially for vets and military, and they remember that. That’s why he consistently polls above everybody else who might challenge him. He’s very well-liked among key groups in Virginia.

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