Monday, December 20, 2010

Tax Cut Talk

If you're headed for the track, don't bother asking Joe Biden for any tips.

Asked by David Gregory on Meet The Press (transcript here) "Do you really expect, in an election year, that anybody's not going to vote to extend the tax cuts," Biden responded

Yeah, I do, I do.... what'll be different is that we will have had the outcome of the deficit commission, we will be able to make the case much more clearly that spending $700 billion over 10 years to extend tax cuts for people whose income averages well over a million dollars does not make sense, number one.

Number two, we're not going to be--we're not in a position, David, where we're going to have, God willing, the shaky economy where we could not afford to continue uncertainty for a month or two or three in the next year had we not made a deal which would actually grow the economy.

Fortunately, Biden is probably not that naive, merely spouting the company line. And to be fair, if the economy is not so "shaky"- and it probably won't be- in two years, there is less reason to extend the tax cuts. Republicans then will acknowledge that- or will enthuse "they've worked so far- why kill a good thing." Which do you think will be their reaction?

But that was only Biden's opinion, a judgement call; far worse to dissemble. Gregory a moment later played a clip from a September interview the Vice-President had with Rachel Maddow, in which Biden pledged "the administration's going to the mat" to end the high-end tax cuts. Gregory noted "by January, you didn't go to the mat," after which the V.P. responded

By the--we did go to the mat. We did go to the mat. We went through every--I went into a total of 130 races out there campaigning for Democrats. Every single race I made this case. Here's what happened. We got to the end, we couldn't get it done, and we had to make a decision: Were we going to let the middle-class tax cuts expire? Let me remind everybody, the House passed middle-class tax cut only. It got to the United States Senate, we supported that provision, and the Senate could not pass it.

Silly, me. I thought voters heard Obama remind them that the GOP had driven the car into a ditch but were exasperated- or mad- that the President and his party had not done enough to drag it back out. The Senate had an opportunity, before the election, to propose extension of the Bush-era tax cuts on middle incomes (while those on upper incomes would expire) but unwisely chose not to do so. The strategy selected was one President Obama seemed quite comfortable with although, as New York's Chuck Schumer has explained

Our colleagues on the other side of the aisle said, 'Did you hear the mandate of the election?' Well, I ran this year, I got 66 percent of the vote in my state. And I saw lots of people and lots of angry people. . . . But not a single one of them, from the tea party or anywhere else, said give tax breaks to the millionaires.

Pretending that voters rejected rejection of tax cuts for millionaires and billionaires is only spin- albeit, Republican spin- but arguably not egregious. But this is:

Were we going to let the middle-class tax cuts expire? Let me remind everybody, the House passed middle-class tax cut only. It got to the United States Senate, we supported that provision, and the Senate could not pass it.

Not quite. One Saturday recently, the Senate fell short of the 60 votes needed to impose cloture on a proposal, with broad Democratic support, which would have extended only the middle-income tax cuts. Then it considered legislation, sponsored by Senator Schumer, which would have extended the cuts for all incomes below $1,000,000.

The latter, still a budget-buster, at least would have allowed the Democrats, if the bill passed, to emphasize: we passed tax cuts for the middle class and not for millionaires and billionaires, whom Republicans wanted to protect. But this wasn't good enough for President Obama, whom earlier this month Newsday reported

is getting along better than ever with Capitol Hill Republicans. But his relationship with Democratic Sen. Charles Schumer has hit a rough patch.

The newly appointed Senate Democratic "message" guru from New York has emerged as the White House's chief antagonist over the tax-cut deal Obama worked out with GOP leaders.

To Schumer, Obama's decision to accept a two-year extension of all the tax cuts enacted under President George W. Bush - even at the highest income levels - is a needless capitulation to resurgent Republicans. Schumer wanted the president to push harder to extend the tax cuts, set to expire at year's end, only for family incomes less than $250,000.

But to the White House, it is Schumer who is acting recklessly by seeking to wage class warfare with just days left on the legislative calendar, risking the health of the economy and the pocketbook of every middle-class household with his threat to carry the fight into next year.

That doesn't sound like a President who is opposed even on principle of tax cuts for the wealthy, beyond that which they would receive on their income up to $250,000. It is extremely unlikely that a White House which opposed Schumer's proposal- and not on the grounds that it would have jacked up the deficit and debt almost as much as tax breaks for all- "supported that provision." Especially because it was negotiating a capitulation "compromise" with Senate Minority Leader McConnell at the very same time.

This must be a problem for the formerly long-term Delaware Senator, having to front for a strategy misguided not only on policy, but also on political, grounds. For the formerly short-term Illinois Senator, not so much.




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