Democratic Senate candidate Tim Kaine of Virginia is touting his tax plan as a "compromise" between both sides of the aisle. Rather than extend the current tax rates for everyone, which Republicans support, or let some of those cuts expire and raise taxes on those making over $250,000 a year, which Democrats support, Kaine proposes letting the tax cuts expire on income over $500,000.
"There's no theology or magic to that number," Kaine told a crowd of 40 at an event in Northern Virginia Wednesday morning. "But it's a number that is a compromise."
After the event, Kaine told THE WEEKLY STANDARD that he supports raising those tax rates even while the country is in a recession, a policy position President Barack Obama rejected in a 2009 interview with NBC's Chuck Todd and again at the House Republican retreat in 2010. Here's the exchange with Kaine:
TWS: "President Obama said a couple of years ago that it’s never a good idea to raise taxes in a recession. I’m just wondering, do you agree with that sentiment, or do you disagree with that?"
KAINE: "I have put on the table a very specific plan, and the specific plan is, the tax cuts that George Allen voted to be temporary were temporary for a reason. The CBO said if you make them permanent, you will completely bust the deficit, and I think we ought to do what George Allen promised to do and let those tax cuts expire for people, for incomes over 500,000. Even people who make more than 500,000 would get the break for the first 500 [thousand]. And I think that would have no effect on jobs, but it would enable us to close the deficit, if that is the goal, and I think it should be, in a way that wouldn’t hurt defense and other key priorities."
TWS: "So you can raise taxes in a recession?"
KAINE: "I just answered the question about as basically as I could."
Obama and congressional Democrats have since adopted the position that tax rates ought to increase for the wealthiest Americans, which is odd given the president's rationale against raising taxes: that doing so would have a "destimulative effect." Kaine may call his proposal a compromise, but it still ignores the conservative (and Obama!) argument that raising tax rates hinders economic growth.