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Can Democrats Break Out of the Blame Game on Taxes?

1 year ago
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Democrats now have two years to plan and execute their next strategy on taxes. Will they blow it again and blame each other for the mess?
Liberals may be outraged by the deal President Obama cut with Republicans, but what the heck did they expect him to do? To my mind, congressional Democrats abdicated their seat at the table the minute they left town in October without having voted on his signature issue: extending Bush-era tax cuts for household income below $250,000 (to help the middle class) and letting them expire on all income above that.
With the lower rates for all incomes set to revert to higher Clinton-era levels on Dec. 31, the consequences were completely foreseeable: Taxes would go up Jan. 1 for everyone in the country unless a post-election agreement could be struck in a matter of days.
Were Democrats timid, or simply deluded about what could be accomplished in a brief lame-duck session? Did they not anticipate that Obama might put economic recovery and middle-class interests before his party's belated insistence on taking a stand?
The deal racing toward Senate and House passage contains what the liberal group MoveOn calls "two millionaire bailouts" -- slashing the estate tax and extending the Bush income tax breaks for the wealthiest 2 percent. It also includes the longest ever extension of unemployment benefits and a host of other breaks for workers, businesses and low- to middle-income families. It amounts to a second huge stimulus, one Obama's economic advisers say is needed to ensure there won't be another dip into recession. But that hasn't stopped the liberal critiques.
"A lot of people are unhappy that the president punted on first down, and I'm one of them," Minnesota Sen. Al Franken wrote at The Huffington Post. Piling on, the Progressive Change Campaign Committee called it "unfortunate that bold lawmakers like Al Franken have to deal with the incompetent negotiation strategy of this White House."
Vermont Rep. Peter Welch told The Hill: "I believe that we had a tough bargaining position, and had the president negotiated until the ninth inning instead of the seventh inning, we would have prevailed on that." Then there was New York Rep. Anthony Weiner. "I'm not a member of the tail-between-my-legs wing of the Democratic Party," he said Sunday on NBC's "Meet the Press." "We're acting like we have a weak hand. We have the right side of the issues and the numbers and I don't know why we don't fight."
Well, there is the notion that you don't indulge in brinkmanship when the stakes are the economy and the future of you and your party in electoral politics. Maybe you don't want to spend the entirety of a short lame-duck session trying to prove a point, while setting yourself up for a worse deal with next year's Republican-controlled House. Maybe you want to get it done quickly, so there's time to repeal "Don't Ask, Don't Tell," pass the New START nuclear arms agreement, schedule votes on the DREAM Act for young immigrants and – not least -- continued funding of the government.
So why didn't Democrats fight this battle earlier in the year when there was time for a few rounds of negotiations and veto threats? The truth is that Democrats were divided into many camps on the issue. Some wanted a defining vote on Obama's original $250,000 threshold for raising the tax rate, some wanted to raise that cutoff to $1 million, some said it was economically unwise to raise taxes on anybody during a recession, and some said it was politically unwise to talk about taxes in any way, shape or form during a campaign.
The centrist Democratic group Third Way vividly showcased the intramural conflict at a late July breakfast featuring Reps. Tom Perriello (scrappy populist from a struggling part of Virginia) and Gerry Connolly (his northern Virginia district is one of the most affluent in the country). Connolly was in the unwise-to-raise-any-taxes-in-recession faction. "Democrats need to abandon their ideology when it comes to the Bush tax cuts and look at the economic reality on the ground," he said.
Perriello said extending the lower rates for income up to $250,000 would stimulate the economy, because people making less than that would spend the money. "I think at the higher end, the logic is not there, particularly given that we have a medium- and long-term very serious deficit concern," he said. And then they both went home to campaign for re-election.
When Congress returned in early fall, Obama and some prominent party strategists pushed and prodded Democrats toward action. Stan Greenberg, James Carville and others released a memo headlined "Democrats should want this tax cut debate." Pollsters Geoffrey Garin and John Anzalone made the same case. Garin said Republicans would be in an "untenable position" if they held middle-class tax cuts hostage to keeping rates lower for the wealthiest Americans.
According to the White House, Obama called on Congress to make the middle-class tax cuts permanent at least 20 times. "We are ready, this week, to give tax cuts to every American making $250,000 or less," he said on Sept. 8. Two days later, he said, "Let's get done what we all agree on." Democratic leaders in both chambers "were clear in their mind that he wanted it done," said a strategist involved in the discussions. "They did not have the consensus necessary to take these things to the floor and that's why they didn't do it."
Now, most of Obama's comments suggested Republicans were holding up the action. He did not publicly pressure his fellow Democrats, say by challenging them to hold the vote. There were no strong warnings at that time that failure to act could damage the overall economy. But let's say Obama had tried to force congressional Democrats' hand, override their internal divisions. Can't you just hear the accusations of over-reach and heavy-handedness, the indignation? ("He's not even on the ballot this year, how dare he tell us what to do when it's our necks on the line!")
Assuming passage of the deal, and all signs point that way, the Bush tax cuts will expire at the end of 2012 – just in time to be central to the 2012 presidential campaign. There's only one way to avoid that, and it's a long shot. That would be to spend next year revamping the tax code in a way that sets lower personal and corporate rates while getting rid of "tax earmarks," as the president's deficit commission calls loopholes, credits and deductions. Ideally this would be done in a way that helps reduce the deficit and appeals to, or at least equally annoys, both parties.

Obama has said several times in recent days that he is open to it. He's demonstrated he has the endurance and persistence to succeed at prolonged, complicated tasks. There may be at least one more in his immediate future.

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21 Comments

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Rob & Kathy

I'm sure they will try. They've done it on everything else...Apparently, they aren't responsible for anything...

December 15 2010 at 11:57 AM Report abuse +10 rate up rate down Reply
cplkling

The Democrats are the Party of No: No cut in spending, No cut in taxes, No jobs, No fiscal control, No plan and No brains. It is so disheartening that the Class Envy/Jealousy ploy that the Dems use to further expand their choke hold on Our Government works so well with so many Americans. It is too bad that more people don't see the Dems for waht they are and that is the Creating Dependency upon Government Party.

December 15 2010 at 11:44 AM Report abuse +13 rate up rate down Reply
1 reply to cplkling's comment
massagebearnj

Sorry to say but the Repubs said they would say NO to anything Obama wants, unless they get their tax cuts. Bush doubled the GOV from 1 Trillion, to almost 2 Trillion when he left office. So there is the big GOV the repubs and tea baggers say it's Obama's fault. I am not saying the Dems do everything right, but heck, stop blaming them for mistakes the Repubs did and you voted for.

December 28 2010 at 10:11 AM Report abuse rate up rate down Reply
rkb1030

Reid says he's angry about the "millionaire bailout" raising the deficit, then he adds $8 billion dollars of pork to the unemployment extension bill. Now the dems are holding the American people hostage. Increase the deficit or don't get unemployment. Yep, Harry Reid sure is worried about the middle class.

December 15 2010 at 11:27 AM Report abuse +13 rate up rate down Reply
Destro

What he needs to do is pull out of all these ungrateful countries and stop the tribute money flowing to all of them.
Then forcably take over the FED.
Then Lower taxes all accross the board.
Spend on things that will give the AMerican people a return and limit deficit spending.

Oh wait, we are talking about Obama.. never gonna happen.

December 15 2010 at 10:39 AM Report abuse +9 rate up rate down Reply
truthforfreedom

Blame who? Themselves? That will never happen. Democrats pull so much baloney, it's hard to see the truth. They blame everyone but themselves for everything. So much palavor and no substance. They are to blame for everything that has transpired in the last 4 years and it's high time for them to go away. It's also time to be rid of lame duck sessions in my opinion.

December 15 2010 at 10:38 AM Report abuse +16 rate up rate down Reply
kdocjjk123

If Obama had wanted to fight the Republicans and protect the country he should have been out before the election pointing out how the Reagan tax cuts had increased the National Debt by over 150% and that with the GHW BUsh war the son then cut taxes on the super rich as he started 2 additional wars that are ongoing. The Dems made no attempt to show the country why we were in a disaster. Both Reagan and GW Bush allowed Wall Street corruption to go unchecked just as they did enforcement of mine safety, oil wells, and food. FDR went to fire side chats to explain to people and Obama will not listen to economists like Paul Krugman who are not tied to Wall Street firms. Dems need a backbone. Obama lost many Dems so may not run again since he ran to the Republicans.

December 15 2010 at 10:06 AM Report abuse -12 rate up rate down Reply
2 replies to kdocjjk123's comment
Mitch, Michelle

Obama didn't run to the republicans. The republicans need to let OBAMA let the Bush TAX Cut expire, and either rape the American people in higher taxes, or savethem by establishing a "true" working budget, and make these changes permanent. OBAMA is still on the dems side, no where near the middle, definetely not right.

December 15 2010 at 11:40 AM Report abuse -3 rate up rate down Reply
jimfurl179

Kdoc.....Comparing tax cuts to deficits is like comparing apples to oranges. Deficits are a function of spending greater than revenues. That simple. The Reagan Tax Cuts did what they were supposed to do. Increase Revenue. The deficits occurred because the Congress spent more. With the Reagan Tax cuts revenues increased by almost 80% from 1981 to 1988. Google it. Federal revenue 1981-1988. So they did their job. Unfortunately the Congress has never received a nickel that they couldn't spend for a dime. Hence the deficits you rail against. Tax cuts that increased revenue were first proposed under President Kennedy by Walter Heller. So this idea is not new nor unique to Republicans. What is unique is the less than artful "class warfare" used by today's Democrats against the successful wealthy. Shame on the wealthy for their success.

December 15 2010 at 7:12 PM Report abuse +3 rate up rate down Reply
sfamilyent

First of all, both major political parties tend toward taking an ideological stand and showmanship, and appear to be adverse to the real work associated with governing. Second, I think there is a misconception that extending the tax cuts will somehow stimulate the economy or that allowing the cuts for the wealthy to expire will have a significant negative affect on the economy; although I understand the argument that allowing taxes to increase will affect the amount of money that people have available to spend, save or invest. Third, all of this debate about taxes is diverting attention away from the very difficult task of addressing our economy with respect to growth and jobs. It should be made abundantly clear to the American people that our trade agreements need to be revised to stop providing competitive trade advantages to products and services from other countries, especially those who have adopted export based economic models complete with import restrictive protectionist measures and/or directly or indirectly subsidize domestic production. Even the new trade agreement with South Korea is tilted in their favor. The political parties would do well to take a real stand for our national economy, rather than debating the merits of extending tax cuts that have little to do with real economic growth or job creation.

December 15 2010 at 9:46 AM Report abuse +5 rate up rate down Reply
nflamingo

The Blame Game, by both parties has gotten us into the problems we have......along with GREED.

December 15 2010 at 9:42 AM Report abuse +5 rate up rate down Reply
ettu

"lawmakers like Al Franken have to deal with the incompetent negotiation strategy of this White House.".................Al Franken is a stand-up comic, and should no more be in a position to pass laws on the American citizens. It would be more promising if Scooby Doo had been elected to the US Senate.

December 15 2010 at 9:37 AM Report abuse +10 rate up rate down Reply
ettu

It is said that the Libs/Progs/Dems have now loaded the tax cut/unemployment benefits bill with approx $3 BILLION in unrelated spending and pork. Does anyone ever follow the money, when thousands, or millions, of taxpayer dollars are approved for non-essential projects, especially when America has become mired in debt?

December 15 2010 at 9:35 AM Report abuse +6 rate up rate down Reply
1 reply to ettu's comment
zeekers14

yep you are right, here are a few examples:
$277,000 for potato pest management in Wisconsin $246,000 for bovine tuberculosis in Michigan and Minnesota $522,000 for cranberry and blueberry disease and breeding in New Jersey $500,000 for oyster safety in Florida $349,000 for swine waste management in North Carolina $413,000 for peanut research in Alabama $247,000 for virus free wine grapes in Washington $208,000 beaver management in North Carolina $94,000 for blackbird management in Louisiana $165,000 for maple syrup research in Vermont $235,000 for noxious weed management in Nevada $100,000 for the Edgar Allen Poe Cottage Visitor’s Center in New York $300,000 for the Polynesian Voyaging Society in Hawaii $400,000 for solar parking canopies and plug-in electric stations in Kansas

December 15 2010 at 12:53 PM Report abuse rate up rate down Reply

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