Suppose the White House budget director abruptly resigned, with precious little explanation given for his departure?
Oh wait - didn't Peter Orszag do exactly that in June, with few media mentions and sound bites beyond the fact that he was tired and wanted to focus on his upcoming wedding? His exit, which was rivaled in speed and muffled explanation only by Bob Herz's from the Financial Accounting Standards Board just two months later, was, according to recent reports, apparently predicated on the fact that no one in the administration was particularly attuned to his warnings on the ballooning deficit or his cautionary advice against implementing any tax hikes in any income bracket for a two-year period.
As evidence of his reticence regarding raising taxes in the current economy, Orszag's byline appeared on a recent op-ed piece in The New York Times arguing against such a raise, but then such a philosophy during his stint at the Office of Management and Budget would have put him in direct conflict with his bosses, who appear to be immovable in their positions about allowing the Bush tax cuts to sunset for those earning above $250,000.
With the 2001 and 2003 tax cuts poised to expire by the end of this year, Congress is under pressure to extend them before they slip away. But House Republicans and the White House are digging in their heels in opposite directions when it comes to extending the tax cuts to those above the $250K ceiling.
Thus far, the president has steadfastly stuck to his campaign promises of allowing the cuts to expire for high-income individuals, while painting the GOP as gatekeepers for the wealthy. However, even some Democrats in Congress have warned that allowing taxes to rise amidst a yes-no-maybe recovery could again serve to plunge the economy into a tailspin.
The issue has ignited a Pier 6 imbroglio between Democrats and Republicans, with a slew of charges and countercharges, not the least of which are insinuations of class warfare. Democrats are not yet saying, however, whether they will schedule a vote on the tax cuts before the Nov. 2 mid-term elections.
Extending the tax cuts for another year for high-income earners would, according to estimates, cost the Treasury in the neighborhood of $39 billion. Still, more than a few Democrats and without question nearly all the GOP are getting increasingly nervous, and rightfully so, about the prospect of raising taxes among their constituencies in an election year. And the fact that Tea Party candidates in Delaware and New York easily breezed through their respective primaries is sure to sound a clarion call that the issue of taxes tends to stir folks up a bit, and prompts them to do something about it - both now and, potentially, in November 2012.
Separately, with this issue, readers may have noticed some slight tweaks to our design format. Our upfront news section will now feature an executive summary of the most important events in accounting titled "Profession Watch," while the majority of breaking news will shift to our newly redesigned online portal, which will be rechristened AccountingToday.com to more closely align with our core brand.
Going forward, Accounting Today will transition to more of a practice management-centric publication, with a higher frequency of firm profiles, features and case studies. Beginning in November, we will also switch to a monthly frequency. Changes notwithstanding, we will continue our tradition of providing the top-quality editorial content that you've come to expect over the past 23 years. Feel free to drop me a line, as I'd love to hear your feedback.
Enjoy!
Bill Carlino
Editor-in-Chief
