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Harry Reid preps deal to lock in big business tax cuts and screw over middle class

Would Harry Reid's last big act as majority leader for the next two years be to screw over the middle class to help out business? If ThinkProgress's sources are right, that's what could be happening. Igor Volksy writes that sources tell TP that Reid has negotiated an agreement with House Republicans that would end some tax breaks for the middle class and make some tax breaks for corporations permanent.

Under the terms of the $444 billion agreement, lawmakers would phase out all tax breaks for clean energy and wind energy but would maintain fossil fuel subsidies. Expanded eligibility for the Earned Income Tax Credit and the Child Tax Credit would also end in 2017, even though the Center for Budget and Policy Priorities estimates that allowing the provisions to expire would push "16 million people in low-income working families, including 8 million children into—or deeper into—poverty." The proposal would help students pay for college by making permanent the American Permanent Opportunity Tax Credit, a Democratic priority.

Meanwhile, two-thirds of the package would make permanent tax provisions that are intended to help businesses, including a research and development credit, small business expensing, and a reduction in the S-Corp recognition period for built-in gains tax.

To top it all off? "The costs of the package will not be offset." Disaster relief? Has to be offset. Tax breaks to corporations and war? Don't need to be offset.

Lending credence to this story is the fact that Treasury Secretary Jacob Lew has "expressed concern about the direction of the discussions," saying "[a]ny deal on tax extenders must ensure that the economic benefits are broadly shared," and that any agreement "is fiscally responsible and extends critical tax benefits for working families."

Presumbably, Reid would be getting something in return for making this deal, but it's hard to see any advantage he might be getting. Averting a government shutdown? Why? Let them do it and let them face the consequences. House Speaker John Boehner and Mitch McConnell both want to avoid that at all costs. Make them work for it. Does he think maybe he can negotiate for another priority like judicial appointments? Not with House Republicans—they have no say and probably don't give a damn about nominations. Are they going to tell Ted Cruz to stop obstructing? Not likely.

1:57 PM PT: Well, this sure helps. The White House has issued a veto threat on this proposed deal. http://blogs.rollcall.com/white-house/obama-would-veto-corporate-tax-cut-tax-extenders-bill/?dcz=emailalert

“The President would veto the proposed deal because it would provide permanent tax breaks to help well-connected corporations while neglecting working families,” said Jen Friedman, deputy White House press secretary.
Back to the drawing board, Sen. Reid.
http://www.dailykos.com/story/2014/11/25/1347464/-Reid-in-talks-on-tax-package-ending-breaks-for-middle-class-extending-some-for-nbsp-business