Warning of a “crisis” from draconian spending cuts and tax increases that could “bring the economy to its knees,” officials representing the nation’s leading business organizations and companies today called on Congress to keep tax rates and spending at their current levels and address sweeping entitlement and tax reform next year.
In an open letter to the Senate and House, officials of the broad-based Tax Relief Coalition demanded a reprieve from the “cliff” and suggested U.S. businesses could not otherwise easily deal with the results.
TRC members are extremely concerned about the impending “fiscal cliff” that would impose about $600 billion in automatic spending cuts and tax increases on the economy in 2013. TRC strongly urges Congress and the Administration to move quickly to avoid this crisis by extending current fiscal policy including the expiring and expired tax provisions and making critically necessary reforms to our tax and entitlement systems their highest priority in the next Congress.
If Congress and the Administration fail to come to agreement in the next few weeks, the combined effect of indiscriminate spending cuts and tax increases would result in a fiscal policy reduction of more than 4 percent of GDP. The timing of the “fiscal cliff” is of particular concern to TRC members who, like other Americans, are continuing to confront daunting economic challenges as the economy continues to struggle.
The Tax Relief Coalition includes banner business organizations like the U.S. Chamber of Commerce, the National Association of Manufacturers, the National Association of Wholesaler-Distributors, and the National Federation of Independent Business – the nation’s leading small business group – as wells as more than 1,000 other business associations, companies and advocacy groups.
In its own sharply worded letter to Congress, the National Association of Wholesaler-Distributors – which alone represents 40,000 businesses – said President Obama’s recent proposal to Congress had shown that he has “completely abdicated his responsibility” to address the fiscal crisis and that his plan to raise tax rates for the highest earners amounted to “punishing wealth and success” and would harm the economy:
The President’s proposal would impose $4.00 in permanent-and-certain tax increases for less than $1.00 in potential-but-not-certain spending cuts. Speaker Boehner is quoted as being “flabbergasted” by the proposal, which he called “not serious.” Senate Republican Leader McConnell is reported to have laughed at the proposal. We concur with those responses.
The letters suggests that, other than currying favor with some corporate chieftains whose political sympathies may lean Democratic, Obama is not succeeding in attracting business leaders to his point of view.