Orszag: Extend Bush tax cuts for 2 years

By Aaron Smith, staff writer


NEW YORK (CNNMoney.com) -- Peter Orszag, who recently stepped down as President Obama's budget director, called for a two-year extension of the Bush tax cuts in an article he wrote in the New York Times on Tuesday.

Orszag, who the paper identified as a contributing columnist, outlined the nation's "nasty dual deficit problem: a painful jobs deficit in the near term and unsustainable budget deficit over the medium and long term."

Whether to extend the Bush tax cuts, which expire on Dec. 31, is one of the most controversial political issues facing lawmakers. It pits the government's need to increase revenue by raising taxes against concerns that tax hikes could hurt the shaky economy.

Obama, in keeping with a campaign pledge, wants to raise taxes on families making more than $250,000 but keep them where they are for everyone else. Republicans in Congress generally want to keep all rates where cuts for everyone.

"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," Orszag wrote.

"[O]ver the medium term, the tax cuts are simply not affordable" but allowing the tax cuts to expire at the end of the year would "make an already stagnating jobs market worse," Orszag continued. (Tax expert Howard Gleckman on the GOP and the Bush tax cuts.)

He gave a nod to the position of his former boss. "Ideally only the middle-class tax cuts would be continued for now," he wrote. "Getting a deal in Congress, though, may require keeping the high-income tax cuts, too. And that would still be worth it."

Orszag resigned from his job as the director of the White House Office of Management and Budget in July -- a position that he had held since 2009. He advised Obama during the push to enact the massive Recovery Act and the health care reform law.

After leaving the White House, Orszag took a position as a distinguished visiting fellow at the Council on Foreign Relations.

On Wednesday, Obama is expected to announce $200 billion worth of tax cuts for businesses to provide incentives to buy new equipment. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play

Search for Jobs

Index Last Change % Change
Dow 17,683.97 -92.15 -0.52%
Nasdaq 4,868.88 -32.01 -0.65%
S&P 500 2,058.19 -9.70 -0.47%
Treasuries 1.87 -0.06 -3.26%
Data as of 11:03am ET
Company Price Change % Change
Bank of America Corp... 15.40 0.01 0.06%
Mylan NV 58.17 -1.18 -1.99%
Apple Inc 123.83 -0.60 -0.48%
Microsoft Corp 40.53 -0.12 -0.31%
General Electric Co 24.77 -0.04 -0.16%
Data as of 10:50am ET
Sponsors

Sections

Baseball is America's pastime. But so is capitalism. So why not take a look at some of the public companies that get dollars from the diamond? More

Americans were expected to spend big this spring after pocketing a lot in savings at the pump. But so far, that's not happening. More