Video: Democrats propose Iraq war tax

msnbc.com staff and news service reports
updated 10/3/2007 11:27:40 AM ET 2007-10-03T15:27:40

The Democratic House leadership on Tuesday quickly and emphatically rejected a proposed tax increase to help pay for the Iraq war.

The plan, unveiled by Reps. David Obey, D-Wis., John Murtha, D-Pa., and Jim McGovern, D-Mass., would require low- and middle-income taxpayers to add 2 percent to their tax bill. Wealthier people would add a 12 to 15 percent surcharge, Obey said.

“This is, as Mr. Obey pointed out, his proposal, the proposal of Mr. Murtha and Mr. McGovern. But this is not a policy which the Speaker or I have signed off on,” said Majority Leader Steny Hoyer shortly after Obey offered the tax hike idea. “This is not a Democratic proposal.”

A few hours later, House Speaker Nancy Pelosi also flatly rejected the tax increase.

She assailed President Bush for asking for "no sacrifice from the American people — except from our men and women in uniform and their families."

But she rejected a tax increase as a form of "sacrifice."

Pelosi scuttles tax hike idea
"Some have suggested that shared sacrifice should take the form of a draft; others have suggested a surtax," Pelosi said in a written statement. "Those who oppose a tax and the draft also should oppose the President's war. Just as I have opposed the war from the outset, I am opposed to a draft and I am opposed to a war surtax."

The sparring over the proposed income tax increase came just a week after the House overwhelmingly voted to raise taxes on smokers by 156 percent, as part of an expansion of the Children's Health Insurance Program.

Bush vetoed the CHIP bill and the tax increase Wednesday.

“Politically it’s the third rail,” House Ways and Means Committee chairman Charles Rangel, D-N.Y. told reporters late Tuesday, referring to an income tax increase.

Using the heavily sardonic style he sometimes employs, Rangel told reporters, “The more money you get, the more soldiers you get.”

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Making jokes about euphemisms such as “enhanced revenues” Rangel said, “Don’t even use that ‘T’ word.”

What goes to the president’s desk for signature will be determined by what Republican senators will allow to get past the 60-vote threshold, Rangel said, implying that the initiative must come from them.

Referring to a possible tax increase he said, “I want to leave it alone.”

But, one reporter asked Rangel, just last week hadn’t the House voted to raise taxes on smokers? Wasn’t that a tax increase? “The CHIP bill was a bill for the children,” he said.

Democrats have been seeking in recent weeks to contrast the approximately $190 billion cost of the Afghanistan and Iraq wars with the $23 billion increase that Democrats want in domestic programs.

Wars' cost to future generations
Bush has threatened to veto most of those domestic spending bills as too expensive. Those bills were largely written by the House Appropriations Committee that Obey chairs. Murtha chairs the panel's subcommittee that writes Pentagon and war spending bills.

"The war will cost future generations billions of dollars in taxes that we're shoving off on them and it is devouring money that could be used to expand their educational opportunities, expand their job training possibilities, attack our long-term energy problems and build stronger communities," Obey said.

Obey also announced that Democrats will not pass a supplemental spending bill for the Iraq war until next year, when Democrats hope public pressure could force Bush to change the course of the war.

Democrats hope their chances of winning a battle with Bush on the war will be better next year as the election season heats up.

"The showdown is going to be in January or February," McGovern said.

The lawmakers said the tax surcharge was similar to policies put in place to pay for the Vietnam War and World War II.

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