Time running out for Bush-era tax cuts

November 9, 2010 7:22:08 PM PST
Time is running out for extending the Bush-era tax cuts. Congress returns from election recess on Monday. But at the moment, Democrats and Republicans seem far apart on whether those tax cuts should be extended for the wealthiest Americans. ABC7 spoke with Sen. Dianne Feinstein, D-Calif., and Congresswoman Jackie Speier, D-San Mateo, about the potential for compromise. ABC7 also spoke to Republicans and business owners about this issue too.

They've got three weeks, maybe four weeks with the holidays, to get this compromise done. If they don't, everybody's taxes are going up.

In San Francisco's North Beach, Joey and Eddies, which used to be Moose's, is closed; so is the Washington Square Bar and Grill. Also, just this past week Joe DiMaggio's Italian Chop House closed. Around the corner, at Rose Pistola, owner Laurie Thomas admits it been a tough year

"Not as bad as last year, but we certainly haven't seen the business come back, especially in a tourist driven area like North Beach," says Thomas.

Thomas is concerned that Democrats in Congress are trying to end the Bush-era tax cuts for those making more than 250,000 a year.

Before leaving for Asia, President Barack Obama said he might consider a compromise to extend the Bush tax cuts for the wealthiest for a year or two, while making them permanent for everyone else.

Feinstein thinks compromise is possible.

"And I suspect that a proposal is going to be worked out that does do that and I think it ought to be given due consideration," says Feinstein.

Feinstein also says the priority must be to extend the tax cuts for the middle class, without impacting small business.

"This economy has been kind to people in the top couple of percents, it has not been kind to people below that," says Feinstein.

But this week California Darryl Issa, R-Calif., told ABC's Good Morning America, he won't support a compromise that raises taxes on the rich.

"Tax certainty is important and it's important for the investing class probably more than anybody else," says Issa.

Issa is in line to become one of the most powerful Republicans when the GOP takes control of the House. But Tuesday, Speier had this response to him.

"The investment class doesn't need any more help thank you very much," says Speier.

Back in North Beach, Thomas is hoping Congress do nothing that will cut into her bottom line.

"I really think right now we just hold to what we're doing and we wait and see if we can get the unemployment rate to come back down if we can see a real economic recovery not just a stock market recovery," says Thomas.

Of course, if the Democratic lawmakers do extend the cuts for everyone and then wait for a compromise with Republicans, it could be a very long wait. It's not going to get any easier for Democrats after Republicans take control of the House in January.


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