Walz and Demmer disagree on tax cuts and economic plans

There’s little agreement on ways to stimulate the economy in the 1st congressional race between incumbent DFLer Tim Walz and GOP challenger Randy Demmer, as the Rochester Post-Bulletin looks at their stances.

On the Bush tax cuts:
Demmer supports reinstating all of the Bush-era tax cuts, including those for households making more than $250,000 a year. He argues it is these wealthier taxpayers who create jobs.

“I don’t support increasing taxes on people right now. I don’t think it is the right time. I don’t think it’s something that is good for the economy,” he said.

Walz supports extending the Bush-era tax cuts for 98 percent of Americans, just not the wealthiest 2 percent. He argues the country cannot afford to be giving tax breaks for millionaires at a time of record deficits.

“We understand that it is the middle class that drives the economy, and with 98 percent of people falling in that $250,000 or below, you put it in the hands of those that make the economy go,” Walz said.

Proposed $50 billion on infrastructure improvements:
Demmer opposed the $798 billion stimulus bill passed last year and argues that the nation cannot afford to spend another $50 billion. He questioned how the Democrats can back the additional spending when the stimulus bill was supposed to be spent on infrastructure.

“This is not the time to be going out and increasing the debt,” he said.

Walz said he is inclined to support the measure, arguing that these sorts of investments are critical to helping the business community compete. He said he would like to see Congress pass the broader transportation bill but that at least this would be a start.

“Our infrastructure is killing us. $80 billion a year, $800 billion over 10 years — that’s what it costs in idling taxes to businesses,” he said.

Tax credits:
For Demmer, the idea of passing Obama’s proposed research and development tax credits while raising taxes on wealthier Americans is the wrong strategy.

“We are imposing increased taxation on job providers, and then we are turning around and trying to figure out how to give them tax credits,” he said.

Walz said he supports the research and development tax credit because it will encourage economic development, especially in industries like biotechnology, which is huge in southeastern Minnesota. He also backs the small-business loan fund, saying that getting access to loans for small-business owners is still a big problem.

“I hear from folks every day that they can’t get the capital in the small businesses. This should make it easier for them to do it while keeping our banks that make good decisions in good shape,” he said.

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