President Bush warned Congress that he would veto a bill that would increase taxes for investors, cost billions of dollars and threaten the U.S. economy.
Despite the high price tag, the June 27 announcement attracted no coverage from the major news media.
“The ramifications of this [bill] are dire for the U.S. economy, federal revenues, and ordinary investors,” wrote Phil Kerpen in National Review Online.
The bill that President George W. Bush threatened to veto was introduced by Michigan democrat Rep. Sander Levin. It would change the current rate of taxation on investment partnerships like pensions, hedge fund and venture-capital investments from the capital gains rate of 15 percent, to the income tax rate – which can be as high as 35 percent.
White House Press Secretary Tony Snow told reporters on June 27 Bush would veto any “broad moves” by Congress to change the tax rate currently in place.
“This is not an administration that's predisposed toward tax increases,” Snow told The New York Post.
Economist Larry Kudlow of CNBC explained why Bush’s veto was important during an interview on Hugh Hewitt’s radio show on June 29.
“It is precisely the president’s low capital gains tax rate, low dividend tax rate and low income tax rate that has helped this economy and stock market enormously even though the poor guy doesn’t get any credit,” said Kudlow.