Molinari said Congress has already come up with a budget that balances. Meanwhile, there's the real budget, the one the White House and Congressional leaders are bashing out behind closed doors. Today, there's a sign that the White House might be open to one key Republican demand, some cut in taxes on capital gains. Marketplace's Washington editor John Dimsdale reports. But the economic arguments over cutting taxes on the profits from the sale of property and stocks and bonds are already well known.
Opponents say a capital gains tax break is regressive since it benefits mostly the wealthy.
So what Mike McCurry really means is the White House will support a capital gains tax cut if it makes political sense. To get the negotiations off dead center, the President is apparently trying to find out what he could get from Republicans in exchange for a concession on capital gains. Perhaps Republicans would agree to provide more earned income tax credits for low-income workers or even trim their Medicare savings. But the Republican negotiators must know that agreeing to cut capital gains taxes isn't that much of a compromise for Bill Clinton. Last September he said he could support capital gains tax breaks, if they were limited to investments that create jobs and raise wages for the middle class.