With the midterm elections fast approaching, President Barack Obama is going head-to-head with Republicans over the tax cuts initiated by President George W. Bush. However, Democrats are also fighting among themselves about which course to follow.
Congress has been back in session for one day and it seems they are headed for a standoff over the income taxes for all wage earners that are scheduled to go up January 1.
"Because wages and incomes have flat-lined for middle-class families, they should definitely get an extension of the tax cuts of 2001 and 2003," Obama said.
In Fairfax, Va., the president met with middle-class voters to push his plan to extend the Bush tax cuts for those earning less than $250,000. It's a plan he said Republicans are holding hostage, because they want to extend them for all Americans -- including the wealthy.
"And this is no small tax hike," said Senate Minority Leader Mitch McConnell, R-Ky. "The tax hike the administration is proposing, according to the IRS, would apply to half of all small business income in this country."
Republicans aren't the only ones at odds with the president when it comes to the tax cuts. Some Democrats also disagree with the president.
"Given the fragility of the economy, all of the Bush tax cuts should be extended," said Rep. Gerry Connell, D-Va.
Meanwhile, new plans are formulating to try to get something accomplished. On Monday, McConnell proposed legislation to insure taxes will not go up for any individual in the coming year.
"We can't let Americas jobs creators pay for Democrats out of control spending," he explained.
Also, Senate Majority Leader Harry Reid, D-Nev., will introduce a jobs bill that he says will help small businesses.
"They are desperate for us to do our jobs and that is to help create jobs," Reid said.
The nonpartisan Congressional Budget Office said if all the Bush tax cuts are extended, economic growth in the next year could nearly double. However, some economists said it is all deficit spending and unsustainable.