President Obama has spent a fair amount of time over the last few days emphasizing the fact that his American Jobs Act is paid for. It wasn’t quite clear, however, how.
During a Rose Garden appearance, Obama pledged to send Congress the American Jobs Act on Monday evening when the legislative body resumes its session. Aides revealed for the first time that the plan will include limits on itemized deductions for individuals who earn more than $200,000 a year and families that earn more than $250,000.
Eliminating those deductions will bring in an additional $400 billion in revenue, said Jack Lew, director of the Office of Management and Budget.
The administration also is recommending closing oil and gas loopholes and changing the depreciation rules for corporate airplanes. All of the new rules, which would take effect in 2013, would bring in an estimated total of $467 billion, more than enough to pay for the president’s jobs bill, Lew said during the White House’s daily press briefing Monday.
Among the highlights, the itemized-deduction measure would raise roughly $400 billion over 10 years; the “carried interest” fix would raise $18 billion, and ending tax subsidies to the oil industry would raise another $40 billion.
Republicans will, of course, balk at all of this, and many already have. But the Obama administration’s approach to financing is heartening anyway — there’s been all kinds of scuttlebutt about the White House proposing regressive policies to pay for the jobs bill, and the rumors were wrong. The president and his team are pushing the better — and incidentally, more popular — financing option.
And the more the GOP opposes this approach, the more Obama will pose the options the way he did on Thursday night:
“Should we keep tax loopholes for oil companies? Or should we use that money to give small business owners a tax credit when they hire new workers? Because we can’t afford to do both. Should we keep tax breaks for millionaires and billionaires? Or should we put teachers back to work so our kids can graduate ready for college and good jobs? Right now, we can’t afford to do both.
“This isn’t political grandstanding. This isn’t class warfare. This is simple math. These are real choices. These are real choices that we’ve got to make. And I’m pretty sure I know what most Americans would choose. It’s not even close. And it’s time for us to do what’s right for our future.”
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