President Obama on the other hand did what is best for the nation.
1. The entire Bush tax cut law is extended for two years. (click title to entry - thank you)2. A one-year, two-percentage point reduction in the payroll tax replaces the Making Work Pay tax credit from the Recovery Act. This $100+ billion stimulus will leave more money in the pockets of both employers and employees, since the payroll tax is divided evenly between boss and worker.
3. A de-clawed estate tax reemerges in 2011, after a one-year hiatus. In 2010, estates larger than $5 million will fork over up 35 percent of dollars above that ceiling. Without congressional action, the estate tax would be restored for estates worth more than $1 million with rates rising to 55 percent.
4. Businesses will be able to deduct 100% of certain investments in 2011 to juice capital investment.
5. Congress will consider extending the American Opportunity Tax Credit (college tuition), Child Tax Credit and Earned Income Tax Credit -- another $40 billion in tax cuts that will primarily help low income families. [This has been rumored but not confirmed.] - I believe the President confirmed this in his speech.
6. Unemployment benefits get a 13-month extension.
President Obama made the Republicans 'concede' to quite a bit. He did well. This will be a topic for the elections in 2012 and the Republicans are hoping it will become THE ONE ISSUE that will be THE WEDGE ISSUE to end all other wedge issues.
The Democrats have to focus on The Simpson-Bowles Commission and drive home the impact this will take on the 2012 election. They have to do this at every opportunity between now and 2012. If the Democrats are going to be wise about all this, they will insist on having the tax issues between the two parites settled along with the implications to Social Security and Medicare as outlined by the Simpson-Bowles Commission. That Commission has to be the center piece for Democrats between now and November of 2012.
This agreement between the Democrats and Republicans should help people facing dire circumstances for this year and next and will provide a cushion for the economy to rebound for awhile yet. Hopefully, this will soften the spiral to the economic collapse that began in 2008.
