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Schumer Takes Kyl To Task For Counting Hedge Funds As Small Businesses

Given he's from New York and has done more than his share to make sure our government policies are friendly to Wall Street, the big banks and the hedge fund managers, I was pleasantly surprised to hear Chuck Schumer take his fellow Senator, Jon Kyl

Given he's from New York and has done more than his share to make sure our government policies are friendly to Wall Street, the big banks and the hedge fund managers, I was pleasantly surprised to hear Chuck Schumer take his fellow Senator, Jon Kyl to task for trying to pretend that you're going to hurt a lot of small businesses if you raise taxes on those making over $250,000 a year.

I've heard this argument so many times from Republicans, it's ridiculous and ABC This Week host Jonathan Karl wasn't much better than Kyl here with trying to pretend like you're going to damage the economy if the wealthiest among us have their taxes go up a few percentage points for their income over a quarter of a million dollars.

KARL:  But I've got to ask you about this question about -- because this is one of the big sticking points left, is whose taxes go up?  Is it people making over $250,000, as the president wants, or Republicans suggested nobody, or people making over a $1 million?
But you, Senator Schumer, had proposed raising taxes only on those making over $1 million.  And I want to take a look at what you said about this proposal, going at $250,000.  This was last year.  You said, "In the eyes of many, it is hard to ask households making $250,000 or $300,000 a year -- in large parts of the country, that kind of income does not get you a big home or lots of vacations or anything else that is associated with wealth.  It also would affect too many small businesses." 
Weren't you right back then, when you said it was wrong to raise taxes on those...
SCHUMER:  Well, look, we offered that to our Republican colleagues two years ago, when the political landscape was different.  They rejected it.  And then the president, sticking to $250,000, campaigned on it openly, overtly.  He won the election on it overwhelmingly on that issue; 60 percent of the public was with him. 
So that is our position.  It's a position that brings in more revenues.  And what we have learned, as the fiscal situation deteriorated, if you go much higher than $250,000, to raise the rest of the revenues you need, you're going to hurt the middle class as you take away their tax deductions.  So it's the right place...
KARL:  But you said back then...
SCHUMER:  ... to be.
KARL:  But you said back then it would affect too many small businesses.  Frankly, you sounded a little like Senator Kyl. 
SCHUMER:  Well, the bottom line is very, very simple, and that is that if you do -- if you go much above $250,000, you're going to hurt the middle class even worse and small businesses even worse by having to take away tax deductions.  That's not the place we were at two years ago.  It is the place we're at now, because the situation is deteriorating. 
KYL:  Jonathan, it's exactly the opposite.  The higher you set that level, the less small business you're going to hit.  And you're exactly right, and Chuck was right back when he talked about a million, because the increase in the tax rates for individual taxpayers sweeps in about a million small-business owners.  Remember, about half of small businesses are women-owned.  And it sweeps them up because they don't pay corporate tax rates; they pay as individuals. 
KARL:  But -- but...
SCHUMER:  Wait a second.  That's counting big hedge funds as small businesses, big Hollywood productions, like Oprah Winfrey, as small businesses.  It affects very few.  We all know mom-and-pop small businesses, the dry cleaner down the street and others, don't make millions and millions of dollars.

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