I found President Obama weirdly convincing
Yesterday, President Barack Obama defended his decision to partner with Republicans on a sweeping tax deal that the New York Times describes this way:
Mr. Obama effectively traded tax cuts for the affluent, which Republicans were demanding, for a second stimulus bill that seemed improbable a few weeks ago.
Mr. Obama yielded to Republicans on extending the high-end Bush tax cuts and on cutting the estate tax below its scheduled level.
In exchange, Republicans agreed to extend unemployment benefits, cut payroll taxes and business taxes, and extend a grab bag of tax credits for college tuition and other items.
Liberals, as we all know, were furious about the deal. Here’s how MoveOn.org described it.
Republicans successfully held the middle class and unemployed Americans hostage until they could make the nation’s wealthiest 2 percent even richer.
Now billionaires will get thousands of dollars in new tax breaks, while teachers get pink slips and hard-working Americans fall even further behind.
But in his press conference yesterday, Obama laid out pretty clearly that he’s not interested in winning battles against Republicans, or in thumping wealthy people.
My number one priority is to do what’s right for the American people, for jobs, and for economic growth.
I’m focused on making sure that tens of millions of hardworking Americans are not seeing their paychecks shrink on January 1st just because the folks here in Washington are busy trying to score political points.
I was prepared to accept the conventional wisdom that Obama got rolled in this deal. But after listening to his remarks, I’m not so sure.
Instead, the President made a pretty good argument that he’s finally got the message that the only priority for his administration right now is jobs.
Yes, this deal was terrible as a deficit-cutting measure. It was an obvious show of weakness as the new GOP majority takes power in the House. And it was terrible politics in terms of shoring up his base.
Obama made it clear that he doesn’t care about any of that — or at least not as much as he cares about propping up and jump-starting the feeble economy.
And isn’t that the message we all wanted him to get in the lead-up to the 2010 midterms? It’s about the economy, stupid.
Liberals, meanwhile, haven’t made a very clear case for why this was a must-win fight.
Do they really care about deficit reduction? Uh, no.
Did they really think a new tax on the rich would lead to passage of a big new stimulus bill, that would hire back a bunch of those laid-off teachers? No one believes that’s politically possible with the GOP taking control of the House.
And it’s a little suspicious that liberal stimulus-hawks who were looking for any way to fluff the economy would suddenly want to raise taxes on anyone — except as a way of getting their digs in.
Yes, tax cuts for the rich are a lousy way to stimulate the economy — most credible economists agree on this point — but it does still provide some boost, right?
It also shores up Obama’s argument, at least a bit, that so many conservatives are opposing this plan, accusing their own GOP leaders of getting rolled.
So maybe, just maybe, this is what bipartisan compromise looks like? Or is the In Box getting spun?
As always, your comments welcome.
So what do you think
Tags: politics
Agree – (but hope springs eternal)
On December 24th it may have been a good argument. But not on December 7th.
Yes, he did sound logical except for for him and his Republican allies having their heads in the sand when it comes to the budget.
We are broke and going more broke.
Same old same old. Let’s buy votes by giving away money. Problem: there is no money to give away.
Short term deficit Good. Long term deficit Bad.
I think he could have gotten more. However, Obama now has the additional advantage of using the Republican “tax cuts for the rich” meme in the 2012 election. But even that won’t help if the economy is still in the tank in 2012. One thing is very clear though, neither Democrats or Republicans seem to care about the deficit as much as they claim.
A couple of points.
The ultra liberal wing of the Democratic Party is not representative of the American public. Much is made about his “base”, but the reality is that he has to govern from the center to have any hope of getting things done. This also lends credence to the belief that, for better or worse (I believe the better), he is a pragmatic politician, not the hardened idealogue many have made him out to be.
A related but different point is that the Democratic party is a coalition of very different types (Mark Twain: “I don’t belong to a political party; I’m a Democrat”). A significant number of conservative Dems in the Senate favored the continuation of all Bush tax rates. It’s not as if there was a unified front on this issue, as the liberals would like to believe. The disaffected Dems should note that they have met the enemy, and they is us.
All that said, the only way this focus on jobs is defensible is if a longer-term deficit reduction plan is developed on its heels.
I don’t know why Obama caved on the tax increases. I don’t know why the supposed Republicans caved on the addition to the deficit. Everyone wanted compromise, this is what you get. Nothing new here for right wingers but maybe now the left has a bit of understanding about how we felt when Bush turned out to be a closet Democrat and why things like the TP were born.
Isn’t this sort of a Clinton type play? Give and take and seek the center?
At least he’s finally looking at practical answers to the economic issue.
I didn’t hear much hope from the GOP about compromising. It wa tax cuts for all, or nothing. I think Obama could’ve gotten into a big peeing match,with no chance of winning. GOP holds out ’til they control the House, and it would just get worse.
The minority strikes again!
I thought that Obama didn’t view tax cuts for anyone as a way to stimulate the economy. At least that is what he said during the “stimulus” debate. Why a change of heart? Could we have saved 800 billion dollars?
Now what do the Republicans do? They dont have any more issues or plans. Cut spending? sure. cut specific programs? Not likely. Maybe they can make cause of repealing the health care reform law before it comes into full effect and people decide they really like it.
I think Obama played the best hand he had. His bargaining position would only get weaker from now on. To turn this proposal down would be the biggest public relations mistake the Democrats could possibly make. It would make them appear to be the ones who don’t care about the unemployed and working class Americans, while giving the GOP a complete public relations victory. Throwing Cindy Lou Who and ‘Joe-the Plumber’ under the bus, while setting the stage for the Republicans to get their high end tax cuts in January would be a complete disaster. In my mind, it is frankly the wrong thing to do to the long-term unemployed and working class Americans who would be hurt tremendously by rejecting it. The top 5 or 10% are not going to lose their homes, their medical care, their kid’s college tuition, their day-to-day survival etc, whichever way this goes. This is precisely what was at stake back on 11/2/10 and the liberals stayed home. Like it or not, they have to go back to the long game now.
If democrats thought that the repeal of tax cuts for the lower income levels was such a high priority, and so crucial for the economy, why did they wait till the 11th hour to make a deal?
They have had two years, why now?
Sorry, above I should have said “continuation” not “repeal”.
I think what we are seeing is the dam break on a lot of frustration and disappointment on the left.
The outrage over this deal is not completely about this deal.
Democrats are not happy with what Obama was able to accomplish given the majority and mandate he was given. Had he not caved into a weakened Republican party (for no apparent political gain) on every piece of legislation leading up to this one… then maybe his base would be able to swallow this one a little better. After all, this time he actually was bargaining from a position of (relative) weakness.
In the end, my conclusion here is the same as the one I reached during the health care debate. Democrats thought they were electing a liberal who shared their ideology when they were really electing a pragmatic centrist. That Obama compromises even when he doesn’t need to really shouldn’t surprise or upset anyone… it is what he campaigned on. Bringing the sides together and changing the way Washington works and all that jive.
My wife has told me I can not again refer to the President as an invertibrate… my realistically I have to accept that Obama has never had a majority in the Senate to get anything passed. Against the Maginot line of the GOP, you need 60 votes to do anything…and he has never had 60, not for a day.
“Democrats thought they were electing a liberal who shared their ideology when they were really electing a pragmatic centrist.”
I also think that the president lives in the real world where he knows that is was not (and is not) democrats that got him into office but moderate republicans (like myself) and independents. That is who you legislate for when you want to get a second 4 years.
BTW he has been a disappointment to all the factions listed above so far!
I totally agree.
Hopefully much like President Clinton we will see a big improvement in this President with the new Congress, divided government works.
On the state level, the deal is going to be a disaster, especially in New York State. They’re going to allow a key bond program for states to expire, which is likely to wreak havoc on New York:
http://www.nakedcapitalism.com/2010/12/trojan-horse-in-tax-compromise-gop-plan-to-bankrupt-states-break-union.html
Also, for anyone with a state pension, there’s this bit of news:
http://staging.hosted.ap.org/dynamic/stories/N/NY_NY_PENSION_COSTS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2010-12-07-13-27-16
“was not (and is not) democrats that got him into office but moderate republicans (like myself) and independents.”
Obama campaigned on a very, very liberal agenda.
As a moderate, I freely admit that Washington “compromises” often in the result in the worst of both worlds. The deficit is going to spin further out of control, pushing us into insolvency. Both the Bush tax cuts and Obama stimulus have failed to create jobs. Spending must be reduced – and not just “waste fraud and abuse”- and taxes have to be raised- and not just on the “rich.” It’s so obvious, yet no one seems to want recognize it, or acknowledge it, or enact it.
As far as state pension system goes, we should switch to defined contribution plan. Time to pull the plug on that unaffordable gravy train.
As the details come out on the tax bill, I’m reading that there will be huge tax cuts for the rich and THE LOWEST WAGE EARNERS WILL PAY MORE TAXES. For people who make about $20,000 a year or less–or for families making less than $40,000 a year – taxes will actually go up. The end of the Making Work Pay tax credit will not be offset by the 2% reduction in payroll taxes.
Most people last year didn’t notice that their paychecks increased slightly becuase the Obama administration decided that instead of sending out a politically smart stimulas check, they would lower taxes in each paycheck, because it would more likely get spent. I’ll bet that those whose check is decreased will notice.
“Yes, tax cuts for the rich are a lousy way to stimulate the economy — most credible economists agree on this point — but it does still provide some boost, right?”
Brian: you have lost sight of the fact that extension does not CUT taxes. It keeps taxes from going up.
This is not stimulative. It’s damage control.
In order to stimulate the ecomony, taxes must be cut from their current levels.
JDM- relax – its extending tax-cuts for the rich – for two more years. Most economists agree there would be better ways to stimulate the economy.
Basically the bill is a status quo bill.
Unemployment insurance-no change, tax rates-no change.
Which is probably a good centrist reasonable thing to do right now. President Obama is correct his critics on this do sound “sanctimonious”.
I think that Obama is playing it smart and allowing the republicans to overstep as they often do.
The reaction to his compromise is just what we need. Maybe the right thing will happen after all.
“Liberals, meanwhile, haven’t made a very clear case for why this was a must-win fight.
Do they really care about deficit reduction? Uh, no.”
I am trying very hard not to swear at this moment.
This bill is a giveaway to Wall Street.
Many of us have been proponents of controlling spending for a very long time. Liberals may wish to have spending programs that help people, that is true, that does not mean we want profligate spending like the BUSH administration WHO CREATED THE MESS WE ARE IN by pushing a tax cut at the same time they initiated two wars.
There is a class war in this country and the lower classes have lost. Worse we are being ground into the dirt by extensions of tax cuts to those who don’t need tax cuts; to a class of people who are doing better every year while ordinary people find themselves poorer every year compared to the previous generation.
I hope that the Tea Party will unite with liberals to defeat this bill.
JDM- relax – its extending tax-cuts for the rich – for two more years. Most (leftists) economists agree there would be better ways to stimulate the economy.
Bad deal all around. Continued tax reductions for the rich is indefensible – it ranks at the bottom of every list of stimulus effectiveness. And it is financed with money borrowed from China. We keep digging the hole deeper.
Worse is the “temporary” reduction in the payroll tax that funds Social Security. This is a Trojan horse that will affect the viability of SS. Opponents of SS will portray the restoration of the payroll tax as a tax increase just as ending the “temporary” Bush tax cuts are being portrayed. Republicans plan on making it as hard as possible to restore any of the “temporary” tax cuts – regardless of how much it increases our deficit, and with the intent to destroy SS.
This is actually a massive stimulus package those who favored more stimulus should be very happy.
Okay, so what are some of the things we can think of to stimulate the economy? One of the first things that comes to my mind is getting rid of this ridiculous 10-20% ethanol in our fuel. It costs more to produce a gallon of ethanol than the ethanol is worth. It damages some engines and most 2 cycles engines. It’s more expensive, causes feed prices and subsequent food prices to rise. It’s great for big acreage corn farmers, but that’s a tiny percentage of those affected.
Other ideas?
BTW- Yes, I agree NYS pensions funds are being mismanaged and a change will come. In fact, it already has in some contracts. But as with raising the SS retirement age, I think it’s wrong to pull the rug out from under those who have already retired. The contract was made, the State has to live up to it. I know many people get riled at new retirees that may live another 30 years, but also remember there are a lot of retirees (and SS recipients) out there that are getting by on their retirement from when they left their jobs and they were making peanuts. It’s not right to pull the rug out from under those people. They are our poor, there’s no COLA in NYS retirements, at least that I’m aware of.
Retirees can thank the Republicans for stopping a bill to send a $250 payment in lieu of a COLA to Social Security recipients.
It should be very clear which side the Republicans are on. Tax cuts for the extremely wealthy at the expense of retiree payments.
Yes, and they can thank LBJ for opening SS to pilfering, otherwise it would still be a solvent “trust” so to speak. And they can thank Clinton for raising the tax rate on SS earnings. Do we really want to play this game? BOTH major parties have robbed the SS system. At this point both share equal guilt. Whats more neither party seems particularly interested in doing anything meaningful at this time for SS or the economy in general, it’s simply a game of “blame the other guy”. For example, suddenly the Dems are worried about how to pay for the anticipated revenue loss leaving the tax rate the same will entail, yet they had zero concern about how to pay for the stimulus or the extension on unemployment benefits!
In my mind, the more I see of the typical political maneuvering going on, the more I desire some real conservative change. Others probably look at it and desire liberal change. At this point, it looks like both of us will be disappointed.
About the best thing that can be said after reading the above posts is that a majority of those doing the posting aren’t being fooled by either party.
Maybe if we lowered the salaries of all elected officials to $50,000 a year and took away all of their benefits including health insurance and pensions, we might be able to see something reasonable take place on taxes, SS and health care.
They don’t care because they have it good.
Bret,
SS is solvent for the next 35 years. This is a recording. Bleep.
Bret said: “I think it’s wrong to pull the rug out from under those who have already retired. The contract was made, the State has to live up to it.”
You’re right, Bret. It won’t stop them from taking your money, though. Bow down to our new austere overlords. (Austere for everyone but Wall Street and bankers.)
Okay, “solvent” was a poor choice of wording. The latest information I could find, dated August 2010, was the Social Security Actuaries Report that noted that starting in 2015 SS will be running a permanent deficit and that a cash flow deficit will occur as early as October 2010. I believe I heard on the news that did in fact happen. I also found older reports from 2004, 5 and 8 that mentioned the 2045 date. It seems that the date for actual insolvency keeps getting bumped up. I doubt anyone can argue that is a positive development. Whats worse, I found one report that claimed, if nothing changes, by 2017 Medicare will be broke.
Regardless of the date, no one in Washington appears to be any too concerned. “We’ll just print more money” appears to be the answer heard most often.
Yeah, I already figured out my retirement isn’t a sure thing. Neither is my wifes, my brothers, her two sisters, my next door neighbors, or a whole lot of other peoples. All your neighbors that work for ORDA, DEC, the schools and state colleges, the DMV, DOT, Dept of Health, Social Services, etc, etc, etc. No one who works for any branch of any municipality has anything like the secure future they were lead to believe they did. Isn’t that great? It’s not just the faceless guy that irritates you so on a blog, it’s all those retirees who pay taxes in North Elba, E- town, Rochester, Albany, Plattsburgh, Dundee, Johnson City, Bakers Mills, Greece, New Paltz, Hebron, Valley Stream….everywhere in NYS.
Boy, must feel good to have the last laugh on all those rotten sobs that took those cushy gov’t jobs.
oa says:
“SS is solvent for the next 35 years.”
It won’t be if the proposed “temporary” payroll tax reduction becomes permanent.
http://www.huffingtonpost.com/rj-eskow/obamas-tax-holiday-a-pois_b_793526.html
That’s true, myown. But as of today…
Bret, I’m not having any last laugh at all. It’s a tragedy that people are losing their public pensions to greedy conservatives and their “moderate,” “sensible,” “grownup” henchmen–who don’t need pensions because they’re already rich–just as it was a tragedy that people lost their private pensions in the 80s to the same corrupt cronies.
I am pointing out that the bell tolls for thee sometimes, but I think it’s awful. And I don’t understand how people at Tea Party rallies sit back just take this giveaway to the rich and takeaway from the little guy, but get all up in arms about somebody’s legitimate birth certificate.
Should read: And I don’t understand how people at Tea Party rallies sit back and take this giveaway to the rich and this takeaway from the little guy,…
“It’s a tragedy that people are losing their public pensions to greedy conservatives and their “moderate,” “sensible,” “grownup” henchmen–who don’t need pensions because they’re already rich”
oa, you lost me. What are you talking about?
Me too. Exactly which conservatives in NYS gov’t are you referring to? Shelly Silver? Pataki? Patterson? Spitzer? These hasn’t been a conservative in NYS gov’t in decades.
This isn’t just about NY State. It’s nationwide. Every conservative think tank in the country is up in arms about public pensions, and a fair number of moderate ones are along for the ride. Ask teh google about what the Cato Institute and Reason Foundation think of public pensions.
There have definitely been public-pension abuses, but the broader reasoning, basically, is they should be eliminated and reneged on because government can’t do anything right. Isn’t that conservative dogma. Or did I miss the last 40 years?
If you don’t get the private pensions reference, read “America: What Went Wrong,” Chapter 9, about what happened to corporate pensions in the 1980s. It gives you the playbook on what’s about to happen to Bret and his public-employee brethren.
And thus have I successfully completed my threadjack!
Nicely played oa!
I have no doubt things will change in the pension area, but it’s hardly “greedy conservatives” leading the charge all by their lonesome. Andy Cuomo is greedy no doubt, but conservative? Our local county board of fools, whoops, I mean legislators isn’t exactly a bastion of conservative ideals, yet they would love to get out of the rising pensions costs mess, as would every local gov’t entity affected. On the national level the problem is recognized by more than just conservative think tanks. The rising costs are simply not just a conservative talking point, that’s wishful thinking on your part. I’m not familiar with anyone talking about abandoning pensioners but what I do hear are calls for realistic changes- for instance, teachers unions that refuse to consider contributing to their health insurance costs.
I think you’re right in the sense there’s a problem that people recognize. But I’m afraid your “greedy conservative henchmen” idea is nothing but another strawman you cooked up. The only targets of major change to their pensions I’ve heard conservatives go on and on about are Congressmen and Senators.
And yes, you did miss the dogma, or misconstrued it. It’s not that gov’t can’t do anything right, it’s that gov’t should work within it’s Constitutional limitations. That’s a battle that’s been going on for over 200 years, if you care to review our history. The ballooning growth of the Federal gov’t and it’s excesses since the 1930’s in particular and the intrusive manner of our current Federal gov’t into our lives is the problem. Various States have a problem in this line too, California probably leads the pack. The deals made between unions and gov’ts is a good example of the problem we have- excesses with no thought to the future. Make the deal, get the union votes, worry about paying for it later. And while we’re at it, let’s move their pension fund into the general fund and use up those “savings” to garner more votes.
Ugly cycle, isn’t it? And no easy answers. I’ve been saying since I got here that tough times are coming and we’re all gonna get hurt. Pointing the finger at the big scary “conservative” monster is completely ignoring the equally big and scary “liberal” monster that can’t grasp the idea that there is no endless supply of money to fund every hair brained idea that comes down the pike.
Bret,
We have met the monster…. and it is us
Bret,
I encourage you to read “America: What Went Wrong” and get back to us on the “greedy conservative” statement as it pertains to pension raids.
Also, you misquoted me, saying I served up as a strawman “greedy conservative henchmen.”
Re-read the quote. The greedy conservatives are supplemented by “their “moderate,” “sensible,” “grownup” henchmen,” in whose number you may include Andrew Cuomo, at least based on his campaign rhetoric.
And you say yourself: “And while we’re at it, let’s move their pension fund into the general fund and use up those “savings”…”
Which is exactly my point, and which is the exact playbook greedy conservatives used to raid private pensions in the late 1980s, all in the name of market efficiency. Those pension funds, just sitting there for poorer people to use, aren’t efficient, doncha know. Just like your pension fund now.
Andy Cuomo is conservative? Okay……whatever you say…….
Troll.
Wow, good come back.