While Nancy Pelosi can probably pass whatever she wants in the House—she’s already written the Blue Dogs off as losers in November—the real tax action this fall will be in the Senate. That’s where Minority Leader Mitch McConnell is working to gather enough votes to block a tax increase on capital gains, dividends and anyone making more than $200,000 a year.
So far Mr. McConnell has corralled all 41 Republicans to commit to extend all of the 2001 and 2003 tax rates beyond their current expiration date of December 31. That includes Maine’s Olympia Snowe, who told reporters yesterday that “Where we start is to extend all the tax cuts. I think that’s important.” She added that she may entertain a tax increase on some people down the road, but not before a two-year extension because “to send any other message is going to have serious impact” on the tepid economic recovery.
Meanwhile, the list of Senate Democrats in favor of an extension is now up to five. Evan Bayh (Indiana), Kent Conrad (North Dakota) and Ben Nelson (Warren Buffett) were already on board, and this week Connecticut Independent-Democrat Joe Lieberman and Virginia’s Jim Webb came around.
Full Story: Review & Outlook: Senate Tax Showdown – WSJ.com