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GOP Would Beg Millionaires For More Tax, Freeze Federal Workers To Fund Payroll Tax Cut

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PAYROLL TAX CUT
Senate Minority Leader Mitch McConnell (R-Ky.), center, in Washington, Wednesday, Nov. 30. | AP

WASHINGTON -- Senate Republicans unveiled a plan Wednesday to cut payroll taxes that asks the rich to pay more tax if they feel like it, freezes and cuts the federal workforce, and means tests for government benefits.

The measure, introduced by Sen. Dean Heller (R-Nev.), is the GOP answer to a Democratic plan to extend and expand a payroll tax holiday through 2012 by slapping a 3.25 percent surtax on incomes above $1 million.

Many Republicans oppose such a tax as "punishing job creators." But they are not above requesting alms from the wealthy in a part of their proposal that sounds like a plea to millionaires.

A fact sheet the Senate GOP leadership released says the plan: "Gives Millionaires & Billionaires Another Opportunity To Help With The Deficit" and "Includes Sen. John Thune's 'Buffet Rule Act of 2011' which makes it easy for millionaires like Warren Buffet who want to pay more taxes to reduce the federal deficit with a voluntary contribution via their tax returns."

Despite the unlikely appeal to the wealthy, the measure does contain several provisions Democrats will have to take more seriously, including a suggestion backed by previous deficit-reduction efforts to freeze federal pay for three years and cut the federal workforce.

The GOP plan cites Congressional Budget Office numbers that found such a move would save $111.5 billion.

The plan also appears to pick up on a report by Sen. Tom Coburn (R-Okla.) that found millionaires get billions of dollars in federal benefits every year. The proposal suggests means testing such things as food stamps, unemployment insurance and Medicare to exclude millionaires.

It also suggests freezing Social Security cost-of-living adjustments for three years for higher income recipients -- which was first included in the health care reform law.

Democrats were nonplussed by the offer, but said at least it shows Republicans favor the payroll tax cut.

"We are glad Republicans have seen the light and taken up Democrats' call to pass a middle-class tax cut, just a few days after their leadership indicated they would oppose it," said Adam Jentleson, a spokesman for the Democratic leadership in a statement. "However, Democrats' proposal would put more money in the pockets of middle class families and create more jobs."

"The Republican proposal cannot pass the Senate as it stands, but now that Republicans have reversed their position on this middle-class tax cut," Jentleson said, "we look forward to working with them to negotiate a consensus solution."

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