July 24th, 2012
05:49 PM ET
(CNN) – The White House and Congressional Democrats are using a Senate vote on Wednesday to try and force Congressional action on a tax cut compromise. At issue is President Obama’s proposal to extend only Bush-era tax cuts on income below $250,000 a year, while allowing cuts for everything over that threshold to expire at the end of the year.
In anticipation of the vote, the National Economic Council released a study on Tuesday surveying the economic effects of the president’s plan, and Vice President Joe Biden held a rare conference call with reporters to hammer home the significance of finding a compromise.
“If Congress doesn't get this done, there are going to be 114 million people – middle class families – see their taxes go up and in effect a cut in their wages,” Biden said. “A typical middle class family, making fifty grand, a family of four, is going to pay $2,200 extra.”
Biden was joined by NEC Director Jason Furman and Deputy White House Press Secretary Josh Earnest. Together the three ran through the potential effects of Congressional inaction.
Inside the NEC study are numerous hypothetical examples that demonstrate the benefits of the president’s plan on various income levels, as well as the potential negative impacts if the plan doesn’t pass. The study also uses evidence from the Treasury Department and the Congressional Budget Office to illustrate many of the points about tax fairness that Obama and his surrogates have been making on the campaign trail in recent weeks.
The study makes the case that tax cuts for the middle class effect more Americans, and that money saved by allowing certain cuts to expire could help pay down the deficit. Two sections offer a defense of the president’s record on tax reduction, and another attacks Republicans for only offering support for a wholesale extension of all expiring tax cuts.
On the call, Biden tried to stress the importance of Wednesday’s vote, even while signaling its likely failure at the hands of united Republican opposition.
“There's this overwhelming concern about what Republicans call decoupling, and they know that if there's a separate vote and the middle class tax cut is in, they don't have the popular support for extending the tax cuts beyond that,” Biden said. “But the Republicans have fixated on extending all the cuts and what they're doing is very simple – and you can understand it from their perspective – they're holding the middle class tax cuts hostage."
Biden and Earnest both emphasized that because Democrats and Republicans agree that an extension of the tax cuts for low- and middle-income workers is vital, the parties should pass a compromise now and then move on to a debate over additional extensions. But Republicans argue that such a move is liable to result in a tax hike on income over the $250,000 annual threshold, which they argue would hurt small businesses and job creators.
“This 'report' states the obvious, raising taxes is bad for the economy,” said Brendan Buck, a spokesman for House Speaker John Boehner, referring to the NEC report. “That's why it's troubling that the president would be willing to destroy more than 700,000 jobs by allowing taxes to go up on so many small businesses and families.”
Furman vehemently disputed this jobs estimate, claiming not only is it based on a partisan study, but it also "used assumptions that are completely at variance both with what the president's policies are and with standard economics."