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Posted at 4:23 PM ET, 12/ 8/2010

Larry Summers says tax cut deal must pass soon to avoid 'double dip'

By Perry Bacon


Top White House economic adviser Larry Summers warned of a "double-dip recession" if Congress doesn't pass President Obama's tax cut agreement soon.

"If they do not pass this in the next couple of weeks, it will materially increase the risk of the economy stalling out and that we would have a double-dip," Summers told reporters at a briefing at the White House on Wednesday afternoon.

A "double dip" is the term used for a cycle that includes a recession, then months of economic growth followed by another recession.

Summers' remarks came as administration officials continued to defend a deal they struck with congressional Republicans that would keep in place tax cuts for families at all income levels for two years, extend emergency jobless benefits through 2011 and cut payroll taxes by two percentage points for every American worker through the end of next year. Democrats have strongly criticized Obama for agreeing that the tax cuts should continue for the wealthiest Americans.

Summers touted several nonpartisan economic analysts who have said that the agreement's reductions in taxes would encourage economic growth.

Summer's comments were striking, not just because of their starkness, but also because they contradicted what the president himself said a day earlier.

"We don't have the danger of a double-dip recession," the president said, arguing that last year's stimulus and the work of the Federal Reserve in stabilizing the economy had forestalled such a possibility.

By Perry Bacon  | December 8, 2010; 4:23 PM ET
Categories:  44 The Obama Presidency, Democratic Party  
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Comments

Larry Summers, boy genius. Summers hailed the Gramm-Leach-Bliley Act in 1999, which lifted more than six decades of restrictions against banks offering commercial banking, insurance, and investment services (by repealing key provisions in the 1933 Glass-Steagall Act): "Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the 21st century," Summers said. "This historic legislation will better enable American companies to compete in the new economy."

So, same clown who thought repealing Glass-Steagall (which lead to our current economic plight) was a good thing is giving advice? Shut the flock up, Larry!

Posted by: braultrl | December 9, 2010 11:43 PM | Report abuse

Larry Summers, boy genius. Summers hailed the Gramm-Leach-Bliley Act in 1999, which lifted more than six decades of restrictions against banks offering commercial banking, insurance, and investment services (by repealing key provisions in the 1933 Glass-Steagall Act): "Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the 21st century," Summers said. "This historic legislation will better enable American companies to compete in the new economy."

So, same clown who thought repealing Glass-Steagall (which lead to our current economic plight) was a good thing is giving advice? Shut the flock up, Larry!

Posted by: braultrl | December 9, 2010 11:43 PM | Report abuse

I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 - 1826)

Posted by: yiblane | December 9, 2010 5:21 PM | Report abuse

I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 - 1826)

Posted by: yiblane | December 9, 2010 5:19 PM | Report abuse

It is my understanding that Social Security is in danger of a lack of funds, now and in the years ahead.

I do not see the point to reducing the FICA deduction from paychecks as a way to stimulate the economy.

Consider this - Credit Cards

At present the Big Banks issuing Credit Cards can charge up to 30% Interest on their cards, not to mention $39 Fees for going overlimit or being a day late with a payment.

And yet, these same Big Banks are getting to borrow money from the Federal Reserve at a rate well under 1%. If you consider it, that means they are borrowing the money for almost nothing, then issuing Credit Cards and using them to Bleed people dry.

By a simple Act of Congress, the Interest Rates charged could be reduced to 12% (just an example) and those $39 Fees reduced to a more reasonable $10 instead.

Considering how very well off these Banks are now, after the Bailouts, with our Tax Money, I don't think this would break them. If anything, they would just have to be more careful who they gave Credit Cards.

If our Goal is to stimulate the economy by putting more spendable money in people's pockets, this would accomplish that far better than reducing Social Security funds.

Also, I am sure the older readers here remember when Interest Rates on any account were limited to a Maximum of 18% years ago.

Except for Congressmen getting Paid Off by banks to allow the Interest Rates to go up from 18 to 30%, I don't understand how these Huge Banks could get away with this.

Please think about this and Contact your Congressman about Reducing those Interest Rates.

Posted by: Veritatis1 | December 9, 2010 11:48 AM | Report abuse

Why don't we all "Stop Pointing Fingers of Blame" and work for solutions?

One of the worst problems I see is the huge amount of money being wasted by the Federal Government.

I would like to see the present Tax Code, and the IRS abolished in favor of a better, and fairer way to collect taxes.
Check out: http://www.fairtax.org/site/PageServer

In a brief nutshell, FairTax allows everyone to keep ALL of their income and NOT File Taxes every year as we do now. Taxes get collected basically the way Sales Taxes are now collected, but certain things are exempt from being taxed and consideration is given to those with low incomes. The wealthy would have NO WAY to have Lawyers and Accountants reduce their tax liability at all.

I also believe the Federal Government needs to be reduced in size, with the States handling certain things.

I would Eliminate the Federal Department of Education - it costs a fortune and doesn't teach even one child. This would be much better handled by the States and at the Local level where people actually SEE and can deal with problems.

The Elimination of the Internal Revenue Service and the Federal Dept. of Education would greatly reduce the Cost of the Federal Government, just for starters.

I have more, but that is enough to chew on for the moment.

Posted by: Veritatis1 | December 9, 2010 11:22 AM | Report abuse

Summers. Isn't he the architect of the “don’t regulate derivatives” plan? How did that work out for us?

Under the financial reform act, he was the architect of the “don’t break up the largest financial organization” strategy.

Now he is saying pass the deficit busting tax cut plan! Run America. RUN!

Posted by: NewThoughts | December 9, 2010 8:44 AM | Report abuse

Summers is such a tool. A couple of percentage points on taxes is not going to affect individual economic behavior. This fiscally irresponsible deal is more likely to CAUSE a double dip recession than to prevent one.

Posted by: demetrios999 | December 9, 2010 7:49 AM | Report abuse

Summers advised the President poorly and that is the reason he gone. He is part of the reason unregulated wall street securitization of mortgages deeply wounded economies around the world.

If there is a double dip, it won't be because the very wealthy didn't get a continuation of the irresponsible bush tax cut. The wealthy will save any money received from the tax cut and not invest it in the USA-maybe in brazil, china, or other foreign economies.

Or if they get their tax cut continuation the wealthy may just sit on that money so that Obama will fail. That is like "just say no".

Posted by: freddane | December 9, 2010 12:09 AM | Report abuse

Responding to centrist5. I also am fortunate to be in the group that pays well over 90 percent of the Federal Income taxes. I also personally employ, directly or indirectly, over a hundred people annually. When people talk in a Machiavellian way about soaking the rich, what they fail to realize is that by doing so, hundreds of people will lose their jobs. I do not begrudge the fact that I pay huge amounts in Federal income taxes. What I do resent is that lazy bureaucrats waste the money I give them, are employed in make work programs, and have federal pensions which would put an honest working man to shame. I realize that people in our country are hurting, and I am doing everything I can, privately, to help them, whether by hiring people for day labor, or supporting low income scholarship programs, or providing private medical assistance for the unemployed and under employed. I do not need a bureaucrat to tell me how to do this, and I certainly don't want the "government" to tell me how they can do it better. I am lucky to have the income that enables me to help others, and I am willing to pay my fair share to the government (although I believe most of it is wasted down some black hole), but I send this message. If you take too much of my wealth, I will no longer be able to employ others, and I will no longer be able to undertake the multiple charitable endeavors I'm involved with that help low income people. Also, we all should beware. The only reason the unemployment rate has not exceeded 10% is that the Feds are still hiring. Feds produce nothing. Accordingly, an increasing percentage of our working population is unproductive, and an increasing amount of our national wealth is being spent on supporting this non-productive segment of our population. If we continue on this track, we will be on a slippery slope from which our country will not survive. Give me LIBERTY to pursue my dreams, and help others pursue theirs.

Posted by: LibertyOne | December 8, 2010 11:43 PM | Report abuse

PS. It's clear Obama wasn't ready to be president and is in way over his head. Please let there be a decent challenger to Obama in the primaries. If there's no dem alternative to Obama, I'd gladly vote for a moderate, economically competent republican over this bozo. Though if someone like Huckabee or Palin is the nominee, I'll just have to stay home in 2012.

Posted by: Alan5633 | December 8, 2010 10:41 PM | Report abuse

It's pretty clear that during his entire term working for President Obama, Larry Summers has cared about little more than his own financial interests and those of his cronies who keep his pockets lined.

What I want to know is how did Obama end up with this guy as his economic advisor? Obama is either really, really corrupt, or shockingly stupid.

Posted by: Alan5633 | December 8, 2010 10:33 PM | Report abuse

I'm with Krugman, Stiglitz, Madrick & America2010 above.

Outside the beltway, the US is already in a Very Big Depression no matter what the macro ##s are. We don't have to worry about a double-dip because our job level is so low that we need to generate jobs at least 10 fold from our present dismal "recovery."

Until we start making lots of jobs very quickly, we're looking @ 2 years of more BS from BHO & the GOP DixieCans.

We need massively improved infrastructure from sewers & water systems to mass building weatherization & insulation retrofits +greening + research on how use wind & solar energy on as many buildings as possible to move away from eco-damaging large windmills that are poorly placed for their neighbors.

In short we have to start using low tech, mid tech, green tech & alternate tech appropriately to each local & individual bldg location and find out how to integrate it all with HS rail, improved mass transit, a secure & smart electrical grid & a real world-class iNet that at least matches Estonia, if not Finland and is properly secured & still protects users improved privacy, security & secure net neutrality.

In short we have to jump our 19th Century infrastructure into the 21st Century. Just the goals listed above would add tons of jobs. Assuring that such changes are made & coordinated with the additional changes that are needed once these are made could very well show that we are in need of a larger labor supply properly allocated with appropriate rewards. We should start encouraging science, energy & technology education, research, & application. We need to emphasize real engineering & trash useless financial "engineering" that helped to put us in our present hole.

Also, all of the above are part & parcel of true national security, as are improved & increased multi-lingualism, international study with Americans going abroad & foreign students coming here.

Posted by: nyer11 | December 8, 2010 10:26 PM | Report abuse

America is in a Great Depression.
Congress needs to pas the New Deal to create 100M jobs that pay enough to support a family with full medical benefits.

America was in a recession from 2000 to 2007 and started the Great Depression in 2007.

Posted by: America2010 | December 8, 2010 9:49 PM | Report abuse

America is in a Great Depression.
Congress needs to pas the New Deal to create 100M jobs that pay enough to support a family with full medical benefits.

America was in a recession from 2000 to 2007 and started the Great Depression in 2007.

Posted by: America2010 | December 8, 2010 9:47 PM | Report abuse

America is in a Great Depression.
Congress needs to pas the New Deal to create 100M jobs that pay enough to support a family with full medical benefits.

America was in a recession from 2000 to 2007 and started the Great Depression in 2007.

Posted by: America2010 | December 8, 2010 9:47 PM | Report abuse

I suppose if one is a multi millionaire, a Harvard professor and a Wall Street insider too, the recession is and always has been over. But for those in the jobless trenches, or resides in a the state that owes billions or both because Visa said it was worth getting in debt.....even if one can't pay for the encouraged debt, know the recession is far from over. One does not have to be a Harvard professor or a Wall Street inside person to know that it has been the middle and lower financial classes who were coerced to: Pay for Bank fraud failures, Pay GM auto failures, Pay for Mortgage failures, Pay for Wall Street failures, CEO's bonuses and now we have to pay for Tax Breaks for millionaires when these were the people whom caused these failures. I am confused, I don't recall that it was some poor latino, black, asian, American Indian or white person that caused all of these failures, nor were these same people the ones who moved American industries to foreign countries. All of these shameless Fiascos were perpetrated by highly educated people from schools such as Harvard, Yale, Wharton.....the list goes on, who encourage greed degrees which in turn produces PHD thieves. So now we have a President who is tying perform a Bernie Madoff, that is telling us this is a great deal! President Obama, you are no Bernie Madoff! Perhaps it would be a good idea to pardon Bernie Madoff and have him join the Geithner-Summers, Bernanke, Poulson economic team. Obviously you don't have to be a professor of economics to be a thief, but it does help.

Posted by: Rlupodimare | December 8, 2010 9:30 PM | Report abuse

I suppose if one is a multi millionaire, a Harvard professor and a Wall Street insider too, the recession is and always has been over. But for those in the jobless trenches, or resides in a the state that owes billions or both because Visa said it was worth getting in debt.....even if one can't pay for the encouraged debt, know the recession is far from over. One does not have to be a Harvard professor or a Wall Street inside person to know that it has been the middle and lower financial classes who were coerced to: Pay for Bank fraud failures, Pay GM auto failures, Pay for Mortgage failures, Pay for Wall Street failures, CEO's bonuses and now we have to pay for Tax Breaks for millionaires when these were the people whom caused these failures. I am confused, I don't recall that it was some poor latino, black, asian, American Indian or white person that caused all of these failures, nor were these same people the ones who moved American industries to foreign countries. All of these shameless Fiascos were perpetrated by highly educated people from schools such as Harvard, Yale, Wharton.....the list goes on, who encourage greed degrees which in turn produces PHD thieves. So now we have a President who is tying perform a Bernie Madoff, that is telling us this is a great deal! President Obama, you are no Bernie Madoff! Perhaps it would be a good idea to pardon Bernie Madoff and have him join the Geithner-Summers, Bernanke, Poulson economic team. Obviously you don't have to be a professor of economics to be a thief, but it does help.

Posted by: Rlupodimare | December 8, 2010 9:29 PM | Report abuse

Here, in terms that we can all understand, is the debt mess that has been created by successive Democrat and Republican Administrations:

http://viableopposition.blogspot.com/2010/12/putting-pile-of-united-states-debt-into.html

It is simply not right that bipartisan dickering has been used as an excuse by both Parties to tax and spend OUR money irresponsibly.

Posted by: Baywoodfarm | December 8, 2010 9:28 PM | Report abuse

The $700 billion TARP bail-out of big banks was done the same way ... ooh ... pass this or else the sky will fall.

Bernanke on Sunday's CBS 60 minutes said no-double-dip .... Larry Summers ... tell me you were watching ... who is lying??? If Benny Boy doesn't know to do his job and can lie on national TV and prove incompetent -- his claims of the fed able to unwind all the garbage bond purchases must be a lie too ... Larry ... let's face it -- you just made up all this today ...

Posted by: free_np | December 8, 2010 9:24 PM | Report abuse

Man, if the American economy can't fight back after all the government stimulus cash and Federal Reserve quantitati­ve easing coughed up so far, then USA capitalism isn't worth a bean.
It's time the banks, financial institutio­ns and Wall Street released a huge chunk of the $3 Trillion they are sitting on and get the economy moving, or the federal government should threaten to impose a 60 percent tax on the cash and give it to citizens with proper small business plans, initiative­, and the enthusiasm to get America going again.
As for continuing the tax break for the super wealthy, well, this should cover it: "Are you nuts?"
Rudy Haugeneder

Posted by: Rudy7 | December 8, 2010 9:21 PM | Report abuse

Man, if the American economy can't fight back after all the government stimulus cash and Federal Reserve quantitati­ve easing coughed up so far, then USA capitalism isn't worth a bean.
It's time the banks, financial institutio­ns and Wall Street released a huge chunk of the $3 Trillion they are sitting on and get the economy moving, or the federal government should threaten to impose a 60 percent tax on the cash and give it to citizens with proper small business plans, initiative­, and the enthusiasm to get America going again.
As for continuing the tax break for the super wealthy, well, this should cover it: "Are you nuts?"
Rudy Haugeneder

Posted by: Rudy7 | December 8, 2010 9:19 PM | Report abuse

Larry Summers is a big fat idiot.

Actually, I think he realizes his doomsday scenario is complete BS. Rather, his conflicts of interest are likely the motivation for such seemingly idiotic statements regarding the consequences for the economy.

Larry Summers is Obama's biggest (fat pun intended) mistake.

Posted by: Alan5633 | December 8, 2010 9:12 PM | Report abuse

The sky will fall if the rich don't get their tax cut.

Posted by: SarahBB | December 8, 2010 9:08 PM | Report abuse

I wish the Post would write something on Summers and why the economics team walked out. I assume that he is saying that he is going back to his hedge fund and that it would destroy the economy if he had to pay higher taxes.

Posted by: jhough1 | December 8, 2010 8:13 PM | Report abuse

...trickle down doesn't work ...but money rises to the top in one hell of a hurry...when pushed by policy makers intent on repaying those who bankrolled their electoral wins...there will be another recession if we ever get out of this one...and as usual the middle will end up the nouveau poor...

Posted by: kmdyson | December 8, 2010 8:09 PM | Report abuse

...trickle down doesn't work ...but money rises to the top in one hell of a hurry...when pushed by policy makers intent on repaying those who bankrolled their electoral wins...there will be another recession if we ever get out of this one...and as usual the middle will end up the nouveau poor...

Posted by: kmdyson | December 8, 2010 8:07 PM | Report abuse

Mr. Summers: Write the following 100 times before you go home: "If you want to change the consequences, you must change what controls the problem!" Got it? Or, you can go medical: "Insanity is to expect changes, while leaving the controlling factors the same" To put it simply: To change something you must change a factor relevant to the problem. It is only reasonable.
Instead of waiting for jobs to come down from heaven, how about upgrading the skills of those with the greatest need: Low Income Worker.
Will that work? Intel hired 300 local teachers to teach all future workers in their new Hi Tech factory. Intel used their people to train the teachers and paid wages to all while they were trained.
Their brand new $1 Billion IC factory opened last month, in Vietnam? Why? "Because salaries in India and China are too high and rising." Maybe Mr. Sommers is already familiar with the fact we have priced ourselves out of the markets. Maybe Mr. Sommers could follow up on Intel moves and see how we could do the same here. Or, are all Low Income Workers only in Vietnam?

Posted by: MikeSar | December 8, 2010 8:03 PM | Report abuse

Larry Summers is a big fat idiot.

Actually, I think he realizes his doomsday scenario is complete BS. Rather, his conflicts of interest are likely the motivation for such seemingly idiotic statements regarding the consequences for the economy.

Larry Summers is Obama's biggest (fat pun intended) mistake.

Posted by: Alan5633 | December 8, 2010 8:00 PM | Report abuse


Screw Harry Summers. I've had enough of the demi-cans and the republi-crats and the tea-bagger chowder heads to last a life time.

It's about time everyone pulls together and do what is best for this republic - not just the rich, the special interest groups and the poor lobbyists.

I've had it up to my eye-teeth with these clowns


Posted by: chamateddy | December 8, 2010 7:58 PM | Report abuse

Larry Summers was involved in the financial meltdown and the bailout of Wall Street. Now he's acting like Solon the wise? His opinion and a buck might get you a cup of coffee.

Posted by: lcarrier1 | December 8, 2010 7:56 PM | Report abuse

He should know he was one of the Architects of the Dip we just went through. Dip is a good word for him.

Posted by: bluetiger | December 8, 2010 7:54 PM | Report abuse

castleb-

the alternative is explaining why extending said tax cuts is a stupid politically popular move that adds $900 billion to the deficit at a time when we REALLY can't afford it and perhaps explaining to the country that sometimes you have to make difficult choices for the good of the country instead of giving into the popular soundbyte that is simply bad governance and digs us into a deeper hole for almost no benefit.

THAT is the alternative: good governance.

Posted by: lestro | December 8, 2010 7:35 PM | Report abuse

Just clarifying the very apt post quoted below. This study not only proves that the rich are not overtaxed, it proves that they are obscenely undertaxed. A family whose income is $60k/year needs every penny of their current take-home just to live decently. A family whose income is $5M/year can live in luxury even if their overall tax rate were 90%! (What, you can't live well on $500,000/year? Poor you! Awwww...).

Of course there's no need to have the high marginal tax rate limit investment. Allowing people to invest with pre-tax dollars would do the trick.

*************************************
According to research by the University of Boston, every income group pays about 40 percent of their earned income in taxes. That study counted ALL the taxes we pay, including FICA, Medicare, state sales taxes, excise taxes (on gasoline, etc.) and fees for such things as auto and truck registration and title transfers. Oh, and don't forget property taxes at the state and city levels. All those who complain, falsely, that the rich are overtaxed only count federal income tax and ignore the rest. That's either ignorant or dishonest; take your choice.

Posted by: martimr1 | December 8, 2010 7:31 PM | Report abuse

The President made a pragmatic decision that ideologues do not like. Fortunately for them (and for us), their decisions don't have the same weight. During this critical time let's unite behind our chief executive for the good of the country. Griping, posturing, verbal abuse are nonproductive. What is the alternative?

Posted by: castleb | December 8, 2010 7:23 PM | Report abuse

The pox on Larry Summers and his ilk and shame on Obama for betraying the believers who elected him.

Posted by: AlleninKerrville | December 8, 2010 7:21 PM | Report abuse

After the regressive anarchists force draconian "austerity" measures - paying for the GOP tax cuts 1981-201x - we won't be able to avoid a double dip.

If we follow the same model as the Europeans unemployment will run 15-20 percent, meaningful government will come to a halt, the social safety net already in tatters from right-wing human sacrifices will be overwhelmed and the Greatest Depression will engulf the western world.

We should all rest assured, though, that conservative values will still be maintained in the continued growth of record corporate profits, especially for the banks and insurance companies who won't have to actually pay claims in the perfect right-wing world.

It will also lift the vale from the face of hate-and-fear right-wing political movement and voters will see their real goal has always been to destroy this country and its citizenry because we are a people who do not live easily under the oppression and suppression that characterizes every other failed conservative society throughout human history.

Posted by: BigTrees | December 8, 2010 7:20 PM | Report abuse

Larry Summers was a bad pick for Obama and he continues to give advice that will further enrich the banker-financier-bought politician cartel. The
pox on him and his ilk. Obama has proven to be a
Republican in disguise and a great disappointment to
the folks who elected him. It is time for progressives to draw the line in the sand.

Posted by: AlleninKerrville | December 8, 2010 7:19 PM | Report abuse

Don't take economic or investment advice from Summers. He is a shill for the banks.

Posted by: chucko2 | December 8, 2010 7:12 PM | Report abuse

OMG! Larry Summers says the sky is falling? Is his new job now to lobby for the rich? Give me a break! Now I really oppose the deal. If Larry Summers is for it then I am definately not!

Summers was responsible for making sure the banks got taken care of and we got the shaft the last two years. He did his dirty work and then left just as the reality that his policies weren't working was sinking in. He left Obama holding the bag. Get lost Summers!

Posted by: sandnsmith | December 8, 2010 7:04 PM | Report abuse

OMG! Larry Summers says the sky is falling? Is his new job now to lobby for the rich? Give me a break! Now I really oppose the deal. If Larry Summers is for it then I am definately not!

Summers was responsible for making sure the banks got taken care of and we got the shaft the last two years. He did his dirty work and then left just as the reality that his policies weren't working was sinking in. He left Obama holding the bag. Get lost Summers!

Posted by: sandnsmith | December 8, 2010 7:03 PM | Report abuse

OMG! Larry Summers says the sky is falling? Is his new job now to lobby for the rich? Give me a break! Now I really oppose the deal. If Larry Summers is for it then I am definately not!

Summers was responsible for making sure the banks got taken care of and we got the shaft the last two years. He did his dirty work and then left just as the reality that his policies weren't working he left and left Obama holding the bag. Get lost Summers!

Posted by: sandnsmith | December 8, 2010 6:59 PM | Report abuse

OMG! Larry Summers says the sky is falling? Is his new job now to lobby for the rich? Give me a break! Now I really oppose the deal. If Larry Summers is for it then I am definately not!

Summers was responsible for making sure the banks got taken care of and we got the shaft the last two years. He did his dirty work and then left just as the reality that his policies weren't working he left and left Obama holding the bag. Get lost Summers!

Posted by: sandnsmith | December 8, 2010 6:58 PM | Report abuse

One of the President's worst decisions was to make Mr. Summers part of his administration.

I recognize the rationale for the President to make this deal with the devil, but I wish he'd be open about it. Right now the Republicans can block approval of restoring the tax rates for only the wealthiest amongst us by use of the filibuster in the Senate. But once the new Congress is seated, the Republicans will control the House and there will be no chance to get decent legislation out of the House with them in control. The Republicans will make sure that a bill continuing the tax cuts only for the middle class will never make it out of the next Congress. So why play any more political games and not take the best deal you can get?

But at least have the decency to explain this to the public instead of hiding behind the cloak of so-called "compromise." Frustratingly Mr. Obama is seen as capitulating to the radical right Republican devil. Explaining the underlying reasons why he capitulated -- oops, compromised -- would have been a much better strategy.

Posted by: dl49 | December 8, 2010 6:50 PM | Report abuse

According to research by the University of Boston, every income group pays about 40 percent of their earned income in taxes. That study counted ALL the taxes we pay, including FICA, Medicare, state sales taxes, excise taxes (on gasoline, etc.) and fees for such things as auto and truck registration and title transfers. Oh, and don't forget property taxes at the state and city levels. All those who complain, falsely, that the rich are overtaxes only count federal income tax and ignore the rest. That's either ignorant or dishonest; take your choice.

Posted by: ianmac37 | December 8, 2010 6:49 PM | Report abuse

Apparently class warfare blinds you to any concern for the American economy. Do you completely not care about people who have lost their jobs and have NO HOPE of ever having another job???!! Does anyone here even realize that 9.8% unemployment is NOT NORMAL and is NOT GOOD!!! Wake UP!

www.oneconservativevoice.wordpress.com

Posted by: rhondaonecvoice | December 8, 2010 6:47 PM | Report abuse

I'm more in tune with Paul Krugman than Larry Summers. But let's face it, this country didn't collapse thanks to President Bush and President Obama and the people who worked for their administrations. The Democrats couldn't get the votes to limit the tax cuts to the middle class. The Republicans would have shut this country down before they quit fighting for their wealthy contributors. I truly hope the tax cuts work and unemployed people start getting jobs.

Posted by: MNUSA | December 8, 2010 6:40 PM | Report abuse

aserwin, the reason people keep referring to tax cuts is because that is exactly what they are. They represent an extension of tax cuts passed during the Bush administration. They are due to expire, because they were passed as temporary cuts. If we extend these temporary tax cuts, then that is clearly another tax cut.

Posted by: rbharris50 | December 8, 2010 6:39 PM | Report abuse

New Bi-Partidanship Spawns New Politics !

YOU HEARD IT HERE FIRST !

2012 REPUBLICAN TICKET

Mitch McConnell for President
&
Barak Obama for Vice President

“MORE FOR THOSE WITH MORE!”

Look forward to more Larry Summers, Bernanke, Geithner, Gates, Patreaus, ... ! It's the beginning of the perpetuation of middle class serfdom ! Celebrate Early !!!!!!

Posted by: theworm1 | December 8, 2010 6:36 PM | Report abuse

New Bi-Partidanship Spawns New Politics !

YOU HEARD IT HERE FIRST !

2012 REPUBLICAN TICKET

Mitch McConnell for President
&
Barak Obama for Vice President

“MORE FOR THOSE WITH MORE!”

Look forward to more Larry Summers, Bernanke, Geithner, Gates, Patreaus, ... ! It's the beginning of the perpetuation of middle class serfdom ! Celebrate !!!!!!

Posted by: theworm1 | December 8, 2010 6:35 PM | Report abuse

Herbert1 -

or you need another math class. because he is right.
the rich pay a large percentage of the tax revenue in this country, but the poor pay a much higher percentage of their income in taxes.

that's a fact.

we can argue about who SHOULD pay what, but the FACT remains that the poor pay more of their money to the government than rich people do, even if the total amount of money rich people pay is a bigger number...

Posted by: lestro | December 8, 2010 6:35 PM | Report abuse

Larry Scummer is the guy who said to Brooksley Born that regulating the OTC derivatives would "cause greatest financial crisis since WW2." In reality, no regulation was the reason for current crisis.

Now he's saying we're going to get into a double-dip recession? We never got out of the first one.

Posted by: abuibnlahab | December 8, 2010 6:29 PM | Report abuse

This guy just bought the Brooklyn Bridge.

The individual who says the rich already pay 75 percent of the taxes thinks he is making a strong point. I will pay millions in federal and state taxes this year inspite of investing heavily in tax free bonds and using long term capital gains strategies. The reason is because my after tax income has been soaring. If the incomes of those of us who are affluent go up a billion dollars each than we will be paying 97percent of the taxes. So the percent of the taxes we rich pay is meaningless. You have to look at our after tax incomes compared to other Americans. We are now having the largest redistribution of income from average Americans to those of us who are affluent in our history.

Posted by: Herbert1 | December 8, 2010 6:27 PM | Report abuse

This guy just bought the Brooklyn Bridge.

The individual who says the rich already pay 75 percent of the taxes thinks he is making a strong point. I will pay millions in federal and state taxes this year inspite of investing heavily in tax free bonds and using long term capital gains strategies. The reason is because my after tax income has been soaring. If the incomes of those of us who are affluent go up a billion dollars each than we will be paying 97percent of the taxes. So the percent of the taxes we rich pay is meaningless. You have to look at our after tax incomes compared to other Americans. We are now having the largest redistribution of income from average Americans to those of us who are affluent in our history.

Posted by: Herbert1 | December 8, 2010 6:27 PM | Report abuse

I'm surprised Mr. Summers didn't warn us that the Belsnickel would get if the tax cuts didn't pass!

(The Belsnickel was a scary creature not well loved except by parents wanting to keep their children in line.)

http://en.wikipedia.org/wiki/Belsnickel

Posted by: shadowmagician | December 8, 2010 6:24 PM | Report abuse

Larry Summers is by the way one of those who makes more than $250k/y so this will benefit him personally greatly. Most economists also think that the eliminating the tax cuts would have no impact on employement so why is he is insisting to extend the tax cut? Again this is a scare tactic by the Dems to fool people.

Posted by: Terminator2 | December 8, 2010 6:17 PM | Report abuse

The individual who says the rich already pay 75 percent of the taxes thinks he is making a strong point. I will pay millions in federal and state taxes this year inspite of investing heavily in tax free bonds and using long term capital gains strategies. The reason is because my after tax income has been soaring. If the incomes of those of us who are affluent go up a billion dollars each than we will be paying 97percent of the taxes. So the percent of the taxes we rich pay is meaningless. You have to look at our after tax incomes compared to other Americans. We are now having the largest redistribution of income from average Americans to those of us who are affluent in our history.

Posted by: centrist5 | December 8, 2010 6:14 PM | Report abuse

I don't know what this guy is taking but I WANT ALOT OF IT TOO. LOL First of all, who bailed out the Banks and Wall Street? Who pays back the Stimulus? Who is going to be shafted on their SSI? Who makes most of the money in the USA? Yep 1-2% and they are the 0nes that hose the rest of us by buying our so called Representatives.

The "rich" pay almost 75% of the taxes in this country.. And yet that is not enough??? Are you kidding? And then for Obama to state the "governments" money when he agrees to not further increasing the taxes on the rich. This money IS their money..not the governments and not the tax payers. This "democracy" is falling apart.

Posted by: Indi1 | December 8, 2010 5:38 PM

Posted by: pleazzer | December 8, 2010 6:11 PM | Report abuse

Anyone that would listen to anything Larry Summers had to say would also believe Paulson and Bush/Cheney that WE THE PEOPLE NEEDED TO BAIL OUT THE BANKS AND WALL STREET.

Posted by: pleazzer | December 8, 2010 6:05 PM | Report abuse

Aserwin-

OR, perhaps it's not about hating the rich, but believing, as Adam Smith, founder of Capitalism, believed:"It is not very unreasonable that the rich should contribute to the public expence, not only in proportion to their revenue, but something more than in that proportion."

just a thought that maybe - just maybe - the wealthy in this country should suck it up and realize that they need to give a little more back to the nation that allowed them to amass such wealth...

Posted by: lestro | December 8, 2010 6:03 PM | Report abuse

Summers is one of the genius boys who got us where we are with his big push for deregulation of banking. He made cerain that his buddies at Goldman didn't get hurt in this lst financial meltdown. I don't trust his judgment. You shouldn't either.

Posted by: stevensp1 | December 8, 2010 6:03 PM | Report abuse

Summers is one of the genius boys who got us where we are with his big push for deregulation of banking. He made cerain that his buddies at Goldman didn't get hurt in this lst financial meltdown. I don't trust his judgment. You sholdn't either.

Posted by: stevensp1 | December 8, 2010 6:02 PM | Report abuse

Truth is, Pelosi has been Speaker for FOUR years. And, the liberals have had the House, the Senate and the White House for two.

Did they not know what they were doing? Were they afraid to reign in Frank and Dodd (Fannie and Freddie)?

I am not a Summers fan, but one thing for sure, if Reid and Pelosi dilly dally on the tax cuts, and we have a double dip recession, it will be called the Obama/Reid/Pelosi DIP, and they can kiss 2012 & 2016 bye bye. History WILL NOT BE KIND TO EITHER OF THEM!

Posted by: wheeljc | December 8, 2010 6:01 PM | Report abuse

How can we have a double dip when we have never climbed out of the first dip.? Actually, the only "dip" in this story is the one Mr. Summers sees every morning while shaving. I'm really weary of these Goldman Sachs alumni and their war on the American middle-class.

Posted by: BBear1 | December 8, 2010 5:57 PM | Report abuse

This sounds just like Nancy Pelosi's statement that for every month the stimulus was delayed, another 500 million (!!!) Americans lost their jobs.

Posted by: Ruperb | December 8, 2010 5:51 PM | Report abuse

Don't let the door hit you on the way out, Mr. Summers.

Posted by: lycg | December 8, 2010 5:47 PM | Report abuse

And this lie about fixing the defecit... Raising taxes on the top bracket would not even cover the "lost revenue" from tax breaks on all other brackets. All this is; class warfare! They want you to hate rich people, plain and simple.

Posted by: aserwin | December 8, 2010 5:45 PM | Report abuse

and here i was naively thinking we were done with the fear mongering coming from the white house...

that's OK though, Obama is still turning out to be my favorite Republican president ever...

Posted by: lestro | December 8, 2010 5:44 PM | Report abuse

Don't let the door hit you on the way out, Mr. Summers.

Posted by: lycg | December 8, 2010 5:42 PM | Report abuse

Why does everyone keep saying this? There are NO TAX CUTS being proposed. What is on the table is a change (increase) in tax rates that have been in place for a decade now! NO ONE is suggesting CUTS of any kind!

Posted by: aserwin | December 8, 2010 5:41 PM | Report abuse

Easy for him to say with $300 Million in a Hedge Fund...

Posted by: WmLaney | December 8, 2010 5:38 PM | Report abuse

The "rich" pay almost 75% of the taxes in this country.. And yet that is not enough??? Are you kidding? And then for Obama to state the "governments" money when he agrees to not further increasing the taxes on the rich. This money IS their money..not the governments and not the tax payers. This "democracy" is falling apart.

Posted by: Indi1 | December 8, 2010 5:38 PM | Report abuse

LET ALL OF THE TAX CUTS EXPIRE!


We can't afford them anyway.


Republicans are already on record voting against the middle class tax cuts (i.e. tax cuts for everyone). So Screw'em!


Let the Repugs own this!

.

Posted by: DrainYou | December 8, 2010 5:26 PM | Report abuse

I thought Larry Summers QUIT and WALKED OUT on Obama!

Brahahahahahaha!

Now he wants us to accept Obama and his rich Republican friends tax cuts for the rich?

Brahahahahahaha!

Posted by: beenthere3 | December 8, 2010 4:43 PM | Report abuse

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