The White House's Fiscal Cliff Talking Points for Business
A K Street source sends along talking points the White House is distributing to the business community in support of President Obama's latest fiscal cliff proposal.
The source says the talking points, part of a "full court press with business," come from Valerie Jarrett, a key White House liason to business leaders.
I've asked the White House about the talking points and will update the post if I hear back.
And now, without further ado:
Why the President’s Proposed Compromise Is Good For Business
- A balanced plan that reduces the deficit and stabilizes the debt. The President’s proposal would include $2.4 trillion in new deficit reduction. Together with the $1.2 trillion in deficit reduction from the Budget Control Act, that would be sufficient to cut the deficit below 3 percent of GDP and put the debt as a share of GDP on a downward trajectory into the beginning of the next decade.
- $1.22 trillion in new spending cuts, on top of those already enacted in the Budget Control Act . These include $400 billion in health savings (with more long-term health savings than the Bowles-Simpson plan), $200 billion in other entitlement savings, $200 billion in additional discretionary savings, $130 billion in spending reductions through the chained CPI, and $290 billion in less interest on the debt.
- $1.2 trillion in additional revenue through Clinton era rates and a downpayment on tax reform. This includes returning to Clinton-era rates for households making over $400,000 and reducing tax expenditures. The dividend and capital gains rates would be 20 percent, which is well below the 39.6 percent top dividend rate in the 1990s.
Provides certainty and stability. The proposal would increase certainty and stability:
- Removes the threat of default from the economy. Includes a two-year extension of the debt limit, subject to periodic McConnell mechanism votes by Congress.
-Permanently turns off the Sequester. More than replaces the deficit reduction from the untargeted, damaging sequester cuts with a balanced package of revenues and spending reforms.
- Makes the Research & Development tax credit and all other business tax extenders permanent. For decades, Congress has passed extenders for short periods of time, often retroactively, increasing uncertainty and reducing the benefits of the incentives. Making all of them permanent would improve stability in the tax code and the efficacy of the incentives. Making extenders permanent would set the stage for meaningful, revenue neutral corporate tax reform.
A process to reform the tax code and entitlements. The President’s proposal would establish a fast track process make additional reforms:
- Revenue neutral individual and corporate tax reform. This process would make the tax code simpler and more efficient. It would also focus on corporate tax reform—building on the President’s commitment to broaden the business tax base and substantially lower corporate tax rates.
- Entitlement reform. A process to obtain savings through reforms that address inefficiencies in our health care system but do not undermine the basic Medicare guarantee, change the eligibility, or weaken Medicaid.
- Upfront measures for jobs. The President’s proposal includes upfront investments in infrastructure and would set the stage for increased investments in the future. It also would extend unemployment insurance, which would help support aggregate demand.