Sen. Bob Corker made headlines Sunday, offering his comment that Republicans ought to consider ceding to allow tax rates on the top 2 percent of wage earners to be increased as part of a deal to avoid the so-called “fiscal cliff.”
Corker made his remarks on “Fox News Sunday.” The comments were some of the first made publicly by a Republican member of Congress signaling that party members may have to be more open to the possibility of raising rates-a primary item of contention in negotiations between the GOP and President Barack Obama.
The senator and former Chattanooga mayor, who is a member of the Senate Banking Committee, suggested that by allowing the Bush-era tax breaks on the nation’s wealthiest to expire, Republicans would be given the upper hand on future political battles, particularly regarding reforms to entitlement programs and debates on raising the debt ceiling.
“Let’s face it, [Obama] does have the upper hand on taxes,” Corker said. “You have to pass something to keep that from happening, and we only have one body. If we were to pass, for instance, raising the top 2 [percent] rates and that’s it, all of the sudden, we do have the leverage of the debt ceiling, and we haven’t given that up. So the only way that the debt ceiling, I think, is given up is if the present comes to the table and talks with Speaker Boehner about real entitlement reform.”
Previously, Corker had suggested that negotiators look to increase revenues by closing certain tax loopholes. In a comprehensive deficit reduction plan put forward by the senator last month, Corker suggested capping itemized tax deductions at $50,000-a move he predicted would bring in an estimated $749 billion in increased revenues.
On Sunday, the senator guessed that maintaining current tax rates for 98 percent of Americans would bring in between $400 billion and $800 billion in additional revenues.
“There’s a growing body of folks who are willing to look at the rate on the top 2 percent, but that’s only-it could be $400 billion, it might be $800 billion, depending on who you deal with that,” he said. “And many of us fiscal Conservatives are beginning to see that we can end up with a lesser revenue increase by agreeing to that, and the shift in focusing to entitlements is where we need to go.”
Although Corker did not specify which reforms to entitlement programs he would prefer, his plan also calls for $641 billion in spending reductions to Medicare, along with gradually raising the program’s eligibility age from 65 to 67.
If the president and Congress cannot reach a compromise, a mix of approximately $700 billion in spending cuts and automatic tax increases is set to go into effect at year’s end. After meeting at the White House Sunday, offices for both Obama and U.S. House Speaker John Boehner issued statements saying that “lines of communication remain open.”