On Thursday the House passed The Small Business Tax Cut Act
of 2012 with a vote of 235 to 173. The Act, sponsored by House majority Leader Eric Cantor of Virginia, would
cut taxes by 20% for small businesses with fewer than 500 employees. Republicans
in favor of this act such as Cantor purport that it will, “create an additional 100,000-plus new jobs,” and help stimulate economic growth.
Democrats in the House counter that there is no stipulation
in the Act that specifically guarantees the creation of new jobs, therefore, the
tax refund may do little to stimulate job creation and stands to adversely effect the economy by
adding $46 billion to the national deficit. Another issue that was cited in a New York Times article addresses the fact that the small businesses
that would benefit from the passing of this Act the most are the small businesses that
have an income of over $1 million per year. This includes already wealthy
celebrities such as Oprah Winfrey and professional athletic teams such as the New
York Giants.
This imbalance, which favors the wealthy celebrity over the
small-town pastry chef, is one that has recently divided the campaigning messages of the Democratic and Republican parties in Congress, with the GOP supporting the wealthy, in order to promote a
trickle down economy, and the Democrats in favor of the "Buffet Rule" which is
essentially a tax hike that would force the wealthy to directly contribute more of their income to the economy.
The Small Business Tax Cut Act is not likely to pass in the
Democratic-run Senate, and has already been threatened with presidential veto
should it pass. Yet, despite its potentially short legislative life, it still
provides us an interesting look at how republican legislation has changed from a traditionally hands-off style of governing, which characterized the Grand Old Party, to significant government interaction in the economy.
Rate this posting:
{[['
']]}
']]}