The newly unveiled GOP plan to pay for the payroll tax break next year includes forbidding super-high earners from collecting unemployment benefits and food stamps. Let’s presume, as Senate Majority Leader Harry Reid, D-Nev., has, that this is not a serious proposal. Other factions of the Republican Party are beginning to acknowledge the possibility of a millionaire surtax.
Republicans finally are conceding that allowing the payroll tax cut to expire would be politically disastrous in an election year. Now the debate shifts to how to cover the $120 billion it is estimated to cost. Democrats want to impose a surtax of 3.5% on annual incomes that exceed $1 million.
Mitch McConnell, R-Ky., rolled out his plan yesterday to cover the extension: Slash the federal work force by 10% and freeze its pay through 2015; forbid the $1 million-per-year club from collecting unemployment and food stamps; and force the super-rich over-65 crowd to pay more of their Medicare premiums. Not surprisingly, 92% of these projected savings are going to come on the backs of federal workers, not millionaires. Read