White House Press Secretary Jay Carney told reporters today that he doubts Congress would let the one-year payroll tax cut expire at the end of the year, because to do so would raise taxes on everyday Americans.
But at least one key thinker on American tax policy doesn't see things quite the same way.
Grover Norquist, president of the influential antitax activist group Americans for Tax Reform, said today that because the payroll tax cut was always billed as a temporary stimulus measure to boost the economy, letting it lapse wouldn't necessarily be a tax hike.
"Because it was sold as a one-year thing, continuing it would be a tax cut," Norquist says. "I don't have a position one way or another whether it should be. But they said, 'We're doing this for one year, it's a stimulus thing, not this new policy to decouple the payroll tax from Social Security.'"
The 2 percentage point payroll tax cut was included in the bipartisan 2010 deal on the Bush-era tax cuts, which also extended unemployment insurance to 2011. Obama has proposed extending it through 2012, but so far GOP senators have been cool to the idea.
Of course, plenty of things in the U.S. tax code are temporary. The Bush-era tax cuts, for example, are set to expire at the end of 2012.
But Norquist drew a distinction with those, claiming that they were clearly meant to be permanent policies, even if they didn't end up being that way.
"Its advocates wanted to make it permanent, but for political reasons, they didn't," Norquist says. "That's permanent tax policy, and extending that is not a tax cut."
Norquist's group is the author of the so-called "Taxpayer Protection Pledge," a promise not to raise taxes, which the vast majority of Republican lawmakers have signed. That's led to the perception that Norquist is the linchpin for the GOP's antitax stance—though Norquist vehemently denies this.
He claims the pledge is a promise that GOP lawmakers make to their constituents, and it's up to America to make "common-sense" determinations about whether or not politicians are keeping their word to constituents.
Norquist has become a familiar villain on Capitol Hill. Democrats, and former Wyoming Republican Sen. Alan Simpson, have blasted him as a puppet master controlling the tax agenda for the GOP and preventing the so-called "super committee" from reaching a debt deal that includes tax hikes.
Norquist claims that the antitax sentiment is coming from voters, and that he's only a convenient scapegoat.
"They do that because they don't want to deal with the fact that the American people don't want their taxes increased," Norquist says.
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