Democracy Soup

Making sense out of the world of politics

Barack Obama would have been better off fighting against W tax cuts in 2009

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If we rolled back exactly 24 months, and if you asked whether the Bush tax cuts would last 0, 2, or 4 years: some would have hoped for 0, but most would said 2. Very few would have said 4.

If you have said 4, congratulations. You were ahead of the curve. The argument these days centers on why it will be now be 4 instead of 2. But they forget the true debate should have been why it wasn’t 0.

President Barack Obama certainly had the momentum after his election in 2008. The Bush tax cuts were vilified, and given the largest separation of income since the 1920s, the timing was perfect. If Obama had said we would use the money to help those who needed jobs, that would have been sweet poetic justice.

Now there was the possibility that this would not have been easy. But people wanted Obama to make changes, and those hated Bush tax cuts were a good place to start.

The Democratic majorities were at a strong point, and if they limited the tax cuts to incomes below $100,000, they would have fought for principled party stands.

But Obama didn’t want to fight that battle in 2009. “Just let them expire naturally” seemed to be the message from the White House.

As we know now, they live on, as if there were zombies. And those who screamed about the deficit – the teabaggers – could have at least pointed to the action taken against the Bush tax cuts as proof of the Dems being serious about the deficit.

Obama doesn’t really want to have that fight in 2010 or 2011 either. The two-year extension of those tax cuts for EVERYONE pushes the debut to the election year of 2012, and we know this won’t get done then either.

The president campaigned in 2008 that the tax cuts were not good or helpful or useful, especially when economic times were so bad. And he got elected. And the tax cuts will survive at least through the entire realm of Obama’s first term in office.

Obama is the target of this concern, but there are other responsible parties. The Democratic Party, champions of the middle class, as they like to portray themselves, define the middle class as anyone making less than $250,000.

Since neither party is a champion of the poor, perhaps the Dems set a high water mark for the middle class in the hopes that those between $100,000 and $250,000 will side with the Dems. After all, the true middle class in this country makes less than $100,000.

Let’s break this down practically: as of 2008, before the worse was yet to come, only 6% of the country made more than $100,000. Now we might not be math wizards, but in that equation, $100,000 is not the middle.

Yes, there are couples who fall through the cracks because they live in high-housing areas, such as New York City, Washington, DC, or San Francisco. And a two-income home in these areas could make $150,000-$200,000. But they still aren’t middle class; even in those areas, they are in the upper echelon. After all, they wouldn’t trade places with a two-income couple making $48,000 combined in Mississippi.

The best scenario at the end of 2010 would be to let all the tax cuts expire and start from scratch. But, as Obama explains, the GOP was holding hostage the unemployment benefits. This leads to problem number 2. If the Bush tax cuts get a 2-year extension, why can unemployment benefits also get a 2-year extension or a 3-year extension.

There have been a few times in the last two years where unemployment benefits were held hostage by the GOP. The Bush tax cuts weren’t held hostage – they lasted 10 years under the original bill. There is nothing in the provisions of legislation that would limit unemployment benefits from being renewed for a long period of time.

Obama also said that the tax cuts for the rich were very important to the GOP, as unemployment benefits were to the Dems. So wouldn’t you think that the Republicans would be desperate to keep the tax cuts even it meant renewing unemployment benefits?

We’ll never know because Obama didn’t want that fight. Well, Obama makes $400,000 a year to fight for the American people, and there are a lot of people who are still waiting for him to put on those boxing gloves.

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Written by democracysoup

December 17, 2010 at 7:40 am

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