Pelosi: Pay for the war by repealing tax cuts for the wealthy

Speaker Nancy Pelosi (D-Calif.) on Thursday said the war supplemental package that will be debated in her chamber and costs approximately $30 billion could be paid for by repealing tax cuts for the wealthy enacted under President George W. Bush. 

"[The] Republicans have said they want to pay for the war by limiting — raising the age of retirement for seniors," she told reporters. "If they want to pay for the war, I think a good place to pay for it would be by repealing the Bush tax cuts for the wealthiest people in our country." 

Tax cuts for the wealthy are slated to expire Jan. 1, and the increase in revenue has already been factored in to the budgetary baseline, meaning it would be difficult to use their repeal as an offset.

Democratic leaders are planning to allow these tax cuts to sunset next year and Pelosi contends they have done little to help the economic recovery. 

"I think it is pretty clear that in the last eight years these Bush tax cuts for the wealthiest Americans did nothing to promote growth," she said. "As I said, in the first eight months of this year alone, 2010, more jobs will be created than were created in the eight years of the Bush administration."

Democrats are expected to extend the Bush tax cuts benefiting the middle class. Pelosi hints their extension will help the economy rebound. 

"[We] have to think about what we are doing to promote growth, and that is what did not happen in the last eight years," she said. 

Pelosi said talks on extending the middle-class tax breaks will begin "pretty soon." 

Others closely monitoring the situation expect that Democrats will wait to extend the breaks until after November's election.