So, it's official now:

The Senate on Saturday rejected President Obama's proposal to let tax rates rise for the highest-income Americans, as Republicans held firm in their push to continue all of the expiring Bush-era tax cuts.

The White House and Congressional leaders are now discussing a deal to extend the reduced tax rates at all income levels, at least temporarily, perhaps for two years.

And what's the annual cost of extending the reduced tax rates that the wealthy are paying (those over $250,000)? $60 billion. That's right. Every single Republican wants to borrow $60 billion a year to give to wealthy folks who probably don't even need the money.

And what could $60 billion a year pay for? David Leonhardt of the NY Times has a nifty list:

** As much deficit reduction as the elimination of earmarks, President Obama's proposed federal pay freeze, a 10 percent cut in the federal work force and a 50 percent cut in foreign aid -- combined.

** A tripling of federal funding for medical research.

** Universal preschool for 3- and 4-year-olds, with relatively small class sizes.

** A much larger troop surge in Afghanistan, raising spending by 60 percent from current levels.

** A national infrastructure program to repair and upgrade roads, bridges, mass transit, water systems and levees.

** A 15 percent cut in corporate taxes.

** Twice as much money for clean-energy research as suggested by a recent bipartisan plan.

** Free college, including room and board, for about half of all full-time students, at both four- and two-year colleges.

** A $500 tax cut for all households.

Furthermore,

Less than 2 percent of households will be affected by this extension, according to the Tax Policy Center, a Washington research group. The great majority of these households will be earning $300,000 or more (because of exemptions that reduce taxable income below $250,000). On average, each household in this group will save more than $25,000 a year because of the extension of the high-end cuts. And they will save even more than that from the extension of the Bush tax cuts, because they will also benefit from the extension of the tax cuts that apply to their first $250,000 of taxable income.

To add insult to injury, the Republicans are screaming that the unemployment benefits that expired last week need to be paid for (instead of adding to the deficit), but these $60 billion worth of tax cuts can be borrowed.

So there you have it: borrow $60 billion to pay folks who make over $300,000 -- OR -- cut spending from somewhere else to help those less fortunate who find themselves unemployed in the middle of this Great Recession.

Welcome to America, circa late 2010.

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Tags: Bush tax cuts, Tax Policy Center, unemployment insurance

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