By Alexander Bolton - 11/08/12 04:10 PM EST
Sen. Charles Schumer (D-N.Y.) on Thursday applauded House Speaker John Boehner (R-Ohio) for changing his “tone” on taxes but derided the Speaker’s call for new revenues without raising tax rates as a “fairy tale.”
Schumer, the Senate Democrats’ chief political guru, told reporters at a breakfast sponsored by the Christian Science Monitor that he believes Republican leaders have seen the “handwriting on the wall” and will compromise on raising taxes. He said the best time to reach a grand bargain to reduce the deficit and avert tax hikes for the middle-class would be before the end of the year.
Schumer believes Boehner’s comments were a prelude to Republicans coming around to a debt-reduction compromise that would raise taxes on the wealthy.
“You can’t expect the Speaker to turn on a dime in 24 hours and embrace everything, higher taxes, higher taxes on the wealthy, but I think privately that he’s seen the handwriting on the wall and it makes me very hopeful that we can do something big in the next month and a half. It’s a good first step,” he said.
Boehner said he could agree to a deficit reduction agreement that raises new federal revenues but he said those funds must come from economic growth spurred by tax reform. Republicans, including members of the Senate’s Gang of Eight, have argued that adequate revenues can be raised through tax reform without increasing the net rates of taxation.
Schumer derided the theory that substantial revenues can be raised without increasing the tax burden on the wealthy.
“Part of his speech he talked about dynamic scoring, this idea if you cut taxes you increase revenues,” Schumer said.
“It’s about time we debunked that myth, it’s a Rumpelstiltskin fairy tale, dynamic scoring. You may remember Rumpelstiltskin was the fairy tale figure who turned straw into gold,” he added, making reference to the popular German children’s tale from the 19th century.
Schumer predicted Senate Republican Leader Mitch McConnell (R-Ky.) would also reverse his opposition to raising taxes on the wealthy.
“He’s very good at reading the political winds, and I think he will in this case,” he said.