Reid wants a five percent tax hike

Senate Democrats are headed for a showdown. They have proposed a 5 percent surtax on the incomes of people earning more than $1 million per year, to help pay for Obama's Jobs Bill.

WASHINGTON DC (Catholic Online) - Senate Democratic leaders made the announcement on Wednesday and appeared to be making an effort to appeal to a growing populist tone. Ultimately, a showdown with Republicans will ensue over how much the wealthy should pay in an effort to help others who are struggling in the troubled economy.

The proposal came from Senate Democratic leaders, and not from the White House. President Obama dismissed a similar proposal last year. The White House has not said whether or not they will back this plan but experts believe it is likely.

White House Press Secretary, Jay Carney said of the plan, "We are open to different ways of paying for the very important broadly supported measures in the American Jobs Act that would grow the economy and create jobs."

The new plan has been developed by Senate majority leader, Harry Reid, a leading Democrat from Nevada. The plan has a twofold strategic purpose. First, to put tax increases on the table which will open the doors to direct the debate between Democrats and Republicans going into the 2012 elections, and second, to pacify some Democrats who objected to parts of the American Jobs Act.

According to Senator Reid, a surtax of 5 percent on those earning more than 1 million per year, will raise as much as $445 billion over 10 years. This is just about enough to pay for the Jobs Bill.
Reid said, the proposal would, "have the richest of the rich pay a little bit more." He continued, "five percent more to fund job creation and ensure this country's economic success."

Many economists are projecting that the economy will remain sluggish through the 2012 election year. Some are even concerned that another recession is possible. The poor state of the economy is a troublesome point for Democrats, who many appeared to be blaming for the overall situation. Democrats, are looking for a way to turn the poor economy into a political advantage. The current bill is one possible way to do that.

Reid emphasized that everyone must pay their "fair share" of taxes, especially millionaires and billionaires. He echoed President Obama's earlier proposal for a "Buffet Rule" that would compel the wealthiest Americans to pay more in taxes.

The timing of the proposal is also sure  to gain popularity from a rapidly growing youth movement known as "Occupy Wall Street."

However, the details of the plan are still yet to be worked out. And, experts agree that it is unlikely to pass Congress.

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