Tags: revenues | debt | talks | taxes

Cantor: Republican Switch on Revenues Marks 'Big Move' in Debt Talks

Monday, 26 Nov 2012 11:25 AM

By Greg McDonald

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House Majority Leader Eric Cantor insisted Monday that Republicans weren't elected to raise income tax rates but are open to the idea of new revenue sources to help solve the debt problem, as he sought to paint a distinction between the two.
But during an appearance on MSNBC's "Morning Joe," the Virginia Republican appeared to rule out an increase in the capital gains tax rate as a revenue enhancer and refused to say what other new sources of revenue would be acceptable in order to strike a deal with President Barack Obama and Democratic leaders in Congress.
Still, Cantor described the fact that Republicans in the House are now willing "to put new revenues" on the table as "a big move" he hopes will change the tone of negotiations with the president and Democratic leaders in Congress.
Asked what had changed since last year when Republicans refused to entertain any tax increases at all, whether in the form of revenue enhancements or rate hikes, Cantor said, "Well, the president got re-elected."
But more than that, he said the looming fiscal cliff deadline at the end of the year, when the so-called Bush-era tax cuts expire and automatic spending cuts begin, made it clear to Republicans that they were re-elected as well "to fix problems."
"We know at the end of this year taxes are going up on everybody," he said. "Everybody, rich, poor, alike . . . The operations statute by law will make these rates go up. That's what's changed."
Cantor made the comments as more and more Republicans are signaling their intention to break a anti-tax pledge to lobbyist Grover Norquist and his Americans for Tax Reform group in order to get a balanced agreement that contains some form of tax increases, deep spending cuts, and entitlement reforms.
Nearly every Republican in Congress has signed the pledge, including Cantor. He declined to say specifically whether he plans to violate it as well. But he stressed that his constituents are more concerned with fixing the economy and debt than they are with maintaining a no-tax pledge.
"You know . . . I haven't talked to Grover Norquist, so I don't know. I don't know what he wants to, or what he does not want to do with his pledge," Cantor said.
"We, as Republicans, are coming to the table having put very specific ideas into the debate about how you fix the spending problem. That we have to do," he continued. "Because I don't care if your raise taxes a hundred percent on the wealthy, you're not going to fix the deficit problem.
"We've got to have the president step up and say, 'Here's my position on how we reform the entitlements and start managing down this debt deficit," he added.
The Virginian was cautious, however, about how far Republicans might go in adding new revenues into the mix, saying that any recipe on the table for fixing the debt problem "can't get in the way of growth."
He suggested, for example, that raising the capital gains tax rate would be, in his view, a disincentive to create new jobs or expand businesses.
"No question there's a lot of money in the cap gains arena," Cantor said. But he added, "My concern . . . is not that Warren Buffet or someone of his stature will pay more, but my concern is the small businessman or woman . . . would have to."

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