Obama’s Big Dilemma: $1M vs. $250K

President Obama faces a difficult choice in his upcoming budget: Stick with his policy of raising taxes on families making more than $250,000 annually or boost that threshold to $1 million.

Dollar_Sign_RedThe president’s tax decision has major political ramifications, as Democrats and Republicans are expected to clash repeatedly over the subject matter during the election year.

Following historic Republican gains in the 2010 election, many congressional Democrats embraced the $1 million figure over fears that the GOP had gained the upper hand by criticizing the $250,000 mark.

Democrats like Sen. Charles Schumer of New York have suggested that many families making $250,000 are not rich. He has acknowledged that Republicans scored political points by arguing that raising taxes on individual income above $200,000 and couples making more than $250,000 would hit a fair amount of small businesses.

But while the president has adopted rhetoric calling on millionaires to pay their fair share, his proposals on the Bush tax cuts haven’t budged from $250,000. And if that approach continues, the Republican presidential nominee could use Schumer’s words against Obama in the 2012 general election.

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Source: Bernie Becker | The Hill