(CHATTANOOGA, Tenn.) — In an attempt to break the political impasse on Capitol Hill, President Obama on Tuesday offered Republicans a new “grand bargain” that would couple corporate tax reform with funding for programs to create middle class jobs.
“I don’t want to go through the same old arguments where I propose an idea and the Republicans just say no because it’s my idea,” the president told workers at an Amazon shipping warehouse. “So I’m going to try offering something that serious people in both parties should be able to support: a deal that simplifies the tax code for our businesses and creates good jobs with good wages for the middle-class folks who work at those businesses.”
The proposal, which Obama announced on the fourth stop of his middle class tour, is part of the White House’s continued attempt to reframe the economic debate ahead of this fall’s debt and deficit negotiations.
“I came here to offer a framework that might help break through the political logjam in Washington, try to get Congress to start moving on some of these proven ideas,” he said.
But Republicans say this grand bargain isn’t much of a bargain at all.
Republicans see the investments in blue-collar work projects as stimulus and claim it would be “the opposite of a concession” to their party, a senior GOP leadership aide explained to ABC News.
“This proposal allows President Obama to support President Obama’s position on taxes and President Obama’s position on spending, while leaving small businesses and American families behind,” a spokesman for House Speaker John Boehner, R-Ohio, said in a statement before the president delivered his remarks.
While it is true that both sides want to see corporate tax rates lowered, Republicans want any tax reform to include both corporations and individuals. They say small businesses will be hurt if just the corporate tax code is overhauled.
“It’s just a further left version of a widely panned plan he already proposed two years ago, this time with extra goodies for tax and spend liberals,” Senate Republican Leader Mitch McConnell said on his chamber’s floor Tuesday. “The plan, which I just learned about last night, lacks meaningful bipartisan input, and the tax hike it includes is going to dampen any boost business might otherwise get to help our economy. In fact, it could actually hurt small businesses and it represents an unmistakable signal that the president has literally backed away from his campaign-era promise to corporate America, the tax reform would be revenue neutral to them.”
In his speech, Obama railed against Republicans for what he said were “manufactured crises” on Capitol Hill and challenged them to put forth their own proposals to boost the middle class.
“Gutting investments in education, that’s not a jobs plan. You know, they — they keep on talking about this — an oil pipeline coming down from Canada that’s estimated to create about 50 permanent jobs. That’s not a jobs plan. Wasting the country’s time by taking something like 40 meaningless votes to repeal ‘Obamacare’ is not a jobs plan. That’s not a jobs plan,” he said to cheers and applause.
A price tag has not been announced for the president’s latest offer, although the White House says corporate tax reform would only be pursed as part of a deficit-neutral package, pairing increased revenues with investments in infrastructure and manufacturing.
“For the first time since the 1990s, the number of manufacturing jobs in America hasn’t gone down; it’s actually gone up. So the trend lines are good. Now we’ve got to build on that progress,” he said.
Although the U.S. has one of the highest corporate tax rates in the world, large businesses often pay far less through the use of loopholes which the president and congressional Republicans both want to close.
“Our tax code is so riddled with loopholes and special interest tax breaks that a lot of companies who are doing the right thing and investing in America pay 35 percent in their taxes. Corporations who’ve got fancy accountants and stash their money overseas, they pay little or nothing in tax. That’s not fair,” he said.
President Obama said he chose this venue because Amazon was a company that did “more for their workers,” highlighting a program the company runs that pays 95 percent of college tuition for employees seeking education in high-demand fields such as computer-aided design or nursing.
Tuesday’s speech also comes one day after the Internet giant announced it was hiring an additional 5,000 at facilities such as this across the country, including Chattanooga, and an added 2,000 in customer service.
The building, called a “fulfillment center” by the company, is where 28 football fields worth of merchandise is housed before being shipped to online shoppers. But Obama’s theme of sustainable, “middle class” jobs may be at odds with his chosen setting. Amazon says typical employees at distribution facilities can earn $11-$13 an hour, $23,000-$27,000 a year, and many of those workers are seasonal.
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