Sen. Ben Nelson (D-NE) now tells TPM he’s “not inclined” to filibuster an extension of the Bush middle-income tax cuts, even if they’re not paired with a tax cut for the wealthy. He does, however, want a temporary extension of the high-income tax cuts at a minimum — and he wants it to be paid for with unspent stimulus funds.
“My sense is I don’t think permanent can pass, so as a practical matter I think we ought to offset as much of these extended tax cuts as possible and extend them for some period of time,” Nelson told reporters outside the weekly Democratic policy lunch.
When asked about his favorite offsets by TPM, Nelson replied, “Well, you still have unspent stimulus funds.”“I think those, clearly, if you look at this extension as being the equivalent as stimulus, then I think it makes sense to use some of this unencumbered stimulus money for those tax cuts.”
According to Pro Publica there are 69 billion stimulus dollars that haven’t gone out the door yet. (This is distinct from the $144 billion on its way out to projects that have already been launched, and the $65 billion in tax cuts yet to take effect.) Much of the $69 billion is set to go to fund infrastructure projects and, while Democrats and the White House broadly oppose digging into this pool of money, Nelson and other conservative Democrats have argued in the past that it should be on the negotiating table. However, Nelson appears to be the first Democrat to advocate paying for upper-income tax cuts with stimulus dollars.
Economists agree that the most stimulative portions of the recovery bill have been spent — but most also say that upper-income tax cuts are among the least stimulus form of deficit spending there is.