President Obama offered his first post-election statement on the “Fiscal Cliff”, and his words, construed very literally, led optimists to imagine that there’s room for a deal with House Republicans. Speaker Boehner has already stated that his House majority won’t block revenue raising, so long as it consists of closing loopholes that benefit upper income taxpayers rather than raising tax rates. The President didn’t say that rate hikes were a non-negotiable demand. As the Washington Post described it,
Republicans say they are willing to entertain new tax revenue but will not allow rates to rise on upper-income earners, as is scheduled to happen at the end of the year. Notably, Obama did not say rates must rise on upper-income Americans — only that they must pay more in taxes — leaving room for a potential compromise.
Jen Rubin thought that Obama regretted his intransigence last year:
This is precisely where we were about 15 months ago when the grand bargain on precisely these terms broke down. It may shock dim reporters or confuse Democratic spinners, but this is nothing new. The only thing that has changed is that the president has the experience of seeing a grand bargain of historic proportions slip through his grasp. He and Boehner know precisely where the deal is to be had — where they were when Obama upped the ante on taxes and the grand bargain crumbled.
She speculated that, with no need to worry about reelection, “the President really has no interest in getting pushed around by unrealistic liberals in his party”, the “safe blue state Senate Democrats would just as soon demand a tax rate hike, let the country go over the cliff and blame Republicans”.
Doesn’t that sound a trifle Pollyannish? The reason why blue state liberals can be unrealistic is that they have no worries about reelection. Obama has no worries about reelection. Obama was in his day the Senate’s most liberal member. There’s a syllogism in there somewhere waiting to get out, and it doesn’t point to a strong aversion to “demand[ing] a tax rate hike, let[ting] the country go over the cliff and blam[ing] Republicans”. He’ll leave the White House in four years either way. If he stands firm, he’ll be a left-wing hero, whatever happens to the economy. If he compromises, his closest ideological compeers will complain that he has once again backed down before the GOP.
The President didn’t take questions, so no one could ask him whether he was in fact moving toward compromise. His press secretary, though, doused that prospect:
Jay Carney just said in the White House briefing Obama will only accept a deal that repeals the Bush tax cuts for the top tax bracket. “If a bill were to reach his desk that extends tax cuts for the wealthiest 2 percent, he will not sign,” said Carney. “We cannot afford it.” Interestingly enough, Carney also said the president wants to both repeal the top-level Bush tax cuts and reform the tax code.
The idea, then, is to restore Clintonian tax rates with fewer deductions and exclusions, so that “the rich” get hammered twice – three times when one adds in the Obamacare surtax on their investment income. The President’s constant refrain, repeated today, is that he is “asking the wealthiest Americans to pay a little more in taxes”. The combined effect of the already enacted Obamacare levy and his new proposals will be a 15 to 20 percent tax increase for the group that already pays the highest taxes in proportion to income. “A little more” is, I suppose, a flexible standard. Obama’s notion of it doesn’t sound like the first step toward reconciliation.
Answer to Pop Quiz: The last run of three consecutive Presidents elected to two terms was Jefferson-Madison-Monroe. Monroe’s second term was dubbed “The Era of Good Feelings”. I doubt that Obama’s will be remembered that way.
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