Today on CNN’s State of the Union, Sen. Judd Gregg (R-NH) argued against the House bill that taxed the AIG bonuses for those who made over $250,000 at 90%. Gregg walked into a trap set by the Democrats to make it look like by opposing the tax, Republicans are supporting the bonuses.
Gregg hammered the tax plan, “It’s an abuse of the tax law. You know, the taxing authority of the United States is our most powerful weapon. You know, the reason we separated from England was because the British were using it abusively. And we, as a Congress, in reaction to something that is outrageous, the AIG bonuses, should not adulterate the system of taxation in this country. We shouldn’t use it in a penal and personal way. It’s really overstepping the appropriate use of taxing authority — and it leads to a very slippery slope. I mean, where does that stop? When does the — what happens if that majority becomes upset with somebody else in the community of our nation and decides to tax them punitively?”
He said that Congress abused their power of taxation,” It’s really an abuse of the power by the Congress, in my opinion, to use the taxing authority in this way. There are other ways to get these — get back on the issue of how you recover these bonuses. I’m sure using the legal authority that we have, rather than this excessive weapon of the tax authority.” Republicans such Gregg are trying to navigate the ideological dilemma of flat opposition to tax increases weighed against tax payer outrage over public money being used to paid undeserved bonuses.
While some on the left are touting Pelosi’s ability to get Republicans to vote for such a big tax increase, the real trap that Pelosi set is forcing Republicans to choose between their ideology or doing what the taxpayers want. However, some Republicans like Sen. Chuck Grassley are not taking the bait.
Grassley said on Face The Nation today, “Well, right now I have to do what I can do. It looks to me like Congress’s best leverage is taxes. It’s like other things need to be done to make sure that people that are on the dole from the tax payers can’t do these sorts of things in the first place.”
Most Republicans have limited their comments to blaming the Democrats, because their party is split on the tax. In the House, the vote was 87-85 against. It is a touchy political situation for the Republicans as well as the Democrats. It is nearly impossible for the GOP to be against the tax and the bonus, without proposing their own alternatives, but this is the course that they have been on. As it stands Nancy Pelosi has put several Republicans in a tough position heading into an election next year, so while the GOP is busy blaming Obama, they are facing possible political fallout of their own next fall.