I count myself among those disgusted by the demand of Senate Republicans to reward millionaires with an extension of their current historically low tax rates before taking up anything else (START Treaty, Don’t Ask Don’t Tell, DREAM Act), yet I refuse to throw Obama and other Democrats who support the compromise tax proposal overboard as some progressive Democrats suggest.
I was angry early in Obama’s administration when Democrats agreed to extend those tax cuts, because that was the time to have the showdown over the false Republican claim that returning tax rates on the wealthy to Clinton era rates would slow the recovery. Of course, had they not extended them then, what do you think the slow recovery would have been blamed on?
To the extent that some of the concessions Obama got from Republicans will put more money in people’s pockets and stimulate growth, such as the cut in Social Security tax and the unemployment compensation extension, the package can be viewed as a back door stimulus that will produce or save jobs. For the past year did it look like there was any chance to get Republicans to support anything stimulative?
And does anyone out there think the next Congress is going to jump right in and start spending up a storm to improve our infrastructure or help struggling states and municipalities, to keep police on the streets and teachers in the classroom, to aid college students or hire more safety inspectors for coal mines and food safety?
It’s hard to celebrate a deficit increase, but it is worth putting it in perspective: the tax cuts for those families earning over $250,000 adds about $140 billion to the deficit over two years. For that, Obama got about $700 billion more for middle income families. Republicans agreed to this despite the deficit increase of nearly a trillion dollars.
To me, the story is not that a Democrat caved to Republican demands to reward the rich before doing any of the nation’s other important business. The story is that Republicans have shown once again that all their talk of concern for deficits is pure posturing.