Wednesday, November 14, 2012

Obama Vows Not to Budge on Bush Tax Cuts

     This is the fighting spirit we've been wanting to see from our President-it's great to still be able to say that. His passion is inspiring the base.

      "President Barack Obama will enter high-stakes budget negotiations firmly committed to seeing the tax rates for high-income earners rise to pre-George W. Bush levels, he assured a gathering of progressive and labor leaders on Tuesday."

    "I am not going to budge," he told the group, according to an attendee who relayed material from the meeting on condition of anonymity. "I said in 2010 that I'm going to do this once, and I meant it."

     As even Bill Kristol admits, "elections have consequences" and one consequence is that the Bush tax cuts for the rich are not wanted by the American people. The President is willing to go over the cliff. His resolve inspired the union guys and other liberals at the meeting:

     "Several sources at the meeting said the president was, as one noted, "more nuanced than going off the cliff." Obama hopes to place "maximum pressure on House Republicans so at the end of the day he may be able to budge them," the source added.

      "It seemed like he meant it," the first source said. "That suggests that they are ready to go over the ledge."

      "Following the meeting, a handful of attendees spoke briefly to the press, praising Obama for vowing to firmly oppose an extension of the tax cuts for the wealthy."

     "It was a very, very positive meeting," said AFL-CIO President Richard Trumka. "We're very committed to making sure that the middle class and workers don't end up paying the tab for a party that we didn't get to go to, and the president is committed to that as well."

     "The president was really standing firm on taxes," said Neera Tanden, president of the Center for American Progress. "Everyone in the room talked about how much they have the president's back in this fight."

      Today, the President will give his first press conference since his victory November 6 and he will make his call for $1.6 trillion dollars in tax hikes on the rich.

      "President Obama, ahead of his first press conference since winning re-election and a meeting later this week with congressional leaders, staked out his starting point for fiscal cliff negotiations -- $1.6 trillion in tax hikes."

      "White House Press Secretary Jay Carney made clear that the president is sticking by his original budget plan, which includes $1.6 trillion in new revenue, by raising taxes on households making more than $250,000."

      "The president has put forward a very specific plan that will be what he brings to the table when he sits down with congressional leaders," Carney said.

      Read more:

      No doubt we're hearing that the impact of going over the cliff would be cataclysmic.

      "The non-partisan Congressional Budget Office has looked at the effects of falling over the fiscal cliff and projected that they would send the U.S. economy back into recession and cause already stubbornly high unemployment to spike above 9 percent. The CBO also estimates that the austerity program would reduce the deficit by nearly $700 billion by the end of 2013."

      Others argue that it's more a fiscal curb than anything else. What's clear is that we can't have the GOP empowered to hold every budget negotiation or debt ceiling deal hostage. As Krugman puts it "Well, this has got to stop."

      "Nobody wants to see that happen. Yet it may happen all the same, and Mr. Obama has to be willing to let it happen if necessary."      
      "Why? Because Republicans are trying, for the third time since he took office, to use economic blackmail to achieve a goal they lack the votes to achieve through the normal legislative process. In particular, they want to extend the Bush tax cuts for the wealthy, even though the nation can’t afford to make those tax cuts permanent and the public believes that taxes on the rich should go up — and they’re threatening to block any deal on anything else unless they get their way. So they are, in effect, threatening to tank the economy unless their demands are met."
       "Well, this has to stop — unless we want hostage-taking, the threat of making the nation ungovernable, to become a standard part of our political process."      
        "So what should he do? Just say no, and go over the cliff if necessary."      
         "It’s worth pointing out that the fiscal cliff isn’t really a cliff. It’s not like the debt-ceiling confrontation, where terrible things might well have happened right away if the deadline had been missed. This time, nothing very bad will happen to the economy if agreement isn’t reached until a few weeks or even a few months into 2013. So there’s time to bargain."
       So more than even just the possible damage to the economy the concern is whether our country is capable of governing itself at all. With the brinksmanship that the GOP has shown itself willing to undertake on even the most routine matters, the nation's very governability now hangs from a thread. Another thing the Dems need to do is what Jonathan Bernstein keeps talking about: meaningful filibuster reform.
       Two interesting ideas to that end are loosening up the reconciliation process-essentially ending the Byrd Rule- and having one "SuperBill" a year that can't be touched by the filibuster.
        So no matter what you think the effects of going over might be it's a good thing that he's willing to use it. A poll from Pew Research suggests that by large margins most Americans will blame the GOP if we go over the cliff.
        I agree that it's not ideal but the Dems are ready to use it and they should be: it would be absurd if they weren't. This would mean the GOP after a loss like they took November 6 still call the shots.

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