GOP Presidential candidate Newt Gingrich says Republicans are going to have a hard time blocking an extension of the payroll tax holiday.
“I think it’s very hard not to keep the payroll tax cut in this economy,” Gingrich said in a presentation at the conservative Heritage Foundation. “I don’t know what Republicans are going to say but I think it’s very hard to say ‘no.’ We’re going to end up in a position where we’re gonna raise taxes on the lowest income Americans the day they go to work and make life harder for small businesses.”
He’s referring to a stimulative, two percent payroll tax holiday President Obama negotiated when he agreed to extend the Bush tax cuts in December. It’s set to expire at the end of the year, and it’s one of the economic growth proposals President Obama has called on Congress to pass when they return from August recess.
“I do think that it’s a serious challenge to not extend it,” Gingrich added.Republicans have supported a temporary payroll tax holiday in the past, but with the economy faltering, and Obama fielding much of the blame, they’ve been grasping for reasons to oppose extending it.
Gingrich backed the plan more in sorrow than in solidarity with Obama. And his analysis is spot on, both politically and from a policy perspective — a de facto payroll tax increase would represent a big counterstimulus at a time when the economy desperately needs more. And Republicans will be hard pressed to support this particular tax increase when the issue becomes public, particularly after waging a very public jihad against all other tax increases.
Gingrich also said he’d oppose extending unemployment insurance unless states were allowed to make it contingent on requiring beneficiaries to attend work training programs. And he said he’d support massive infrastructure spending, but only if it were financed by royalties from expanding offshore oil drilling and other unspecified new energy exploration revenues.