While optimistic “that we can get a good deal,” Murray said Democrats would not, for example, sign on to a plan that would offset the $55 billion defense portion of the $109 billion in automatic spending cuts mandated by the “sequester,” the budget-slashing mechanism agreed to as part of 2011’s debt-ceiling showdown. The remainder of the reductions come from discretionary spending, home to Democratic priorities like social welfare programs, and reductions in payments to Medicare providers.
“None of the automatic cuts are good policy. They were packaged together in a bipartisan fashion to get both sides to the table, and they will be replaced, or not, as a package,” Murray said. “Here in D.C. the defense cuts get most of the attention – but across America, all the automatic cuts would be deeply damaging to families and communities.”
Several Republican senators have been pushing for legislation that offsets defense spending with cuts and even the potential for new taxes in recent weeks.
On taxes, Murray perhaps presaged how taxes may come to a vote in the Senate before the August recess. She prefers a bill authorizing an extension of the the tax cuts up to $250,000 in household income coupled with an amendment extending all the Bush-era tax cuts.
Thus, “[a]ny senator who supports extending tax cuts for the middle class – they can vote for our bill. Any senator who supports extending tax cuts for the rich – they can vote for the Republican amendment. And any senator who supports extending all the tax cuts – well, they can vote for them both,” Murray said.
Republicans, who have ripped a $250,000-and-under extension alone as a massive hike on taxes for small businesses who file taxes through the income tax code, are left in the unappetizing position of killing off all the tax-extension measures. That’s because they want to avoid giving Democrats a political victory and protect small businesses, in their view.