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Posted at 12:27 PM ET, 12/ 6/2010

Can the White House win in 2012 by losing on the Bush tax cuts now?

By Ezra Klein

obama2012cuts.JPG

The compromise the White House is negotiating on the Bush tax cut is looking more and more like the White House's opening gambit in the 2012 campaign.

The White House has stopped negotiating for ideal -- or even acceptable -- tax policy and moved to negotiating stimulus policy. The tax cuts for income over $250,000 will pump about $100 billion into the economy over the next two years. It's not the most stimulative way to spend $100 billion, but it's more stimulative than not spending it, or than raising taxes. And it won't be alone.

The deal isn't done, but right now, Democrats look likely to get a 13-month extension of both unemployment insurance and many of the tax breaks built into the stimulus (Making Work Pay, the bump in the Earned Income Tax Credit and the Child Tax Credit, the business tax breaks and so on). That totals about $180 billion over two years. So if the White House gets the deal that the early reports suggest are close -- and that they seem to think they'll be able to get -- this is a two-year stimulus package that approaches $300 billion. [Update: Just to be clear, that's $300 billion for tax cuts for income over $250,000, and tax extenders. Add in the rest of the tax cuts -- which I left out because they're already at consensus -- and it's closer to $750 billion. So the $300 billion is the marginal cost over the tax cuts for income under $250,000.]

In other words, rather than paring the tax cuts and the deficit back, they're making both larger. If you're of the mind that the economy needs all the extra help it can get right now -- and you should be -- this is a lot more extra help than anyone expected Republicans and Democrats would agree to give it. And from a political perspective, if you believe that what matters for elections is the economy -- and you should -- then it's worth it for the White House to lose news cycles in 2010 if it means adding jobs by 2012.

That's the policy of the deal. The politics are similarly focused on the next election: Democrats are negotiating toward a two-year extension of the tax cuts. They've rejected a three-year extension. That means the next fight over the tax cuts will be part of the 2012 election. And the White House believes that an improved economy and a bigger deficit will make it much harder for Republicans to support extending tax cuts for the rich. If they try, that gives Democrats both a populist cudgel and a way to take hold of the deficit issue.

The White House's problem is that they handled the politics of this argument so poorly in 2010 that their allies on the Hill don't trust them to do better in 2012. One Senate staffer summed up his reaction to the deal in one word: "Nausea." Another said the deal is fine -- but it was getting hard to trust the White House. "Will they actually have that fight in 2012?" He asked. "They dropped the ball this time around."

The irony of the situation is that the White House may strike a better deal because they handled the politics so poorly. If they'd showed more backbone early on and publicly demanded that the Republicans extend a package of tax breaks from the much-hated stimulus bill, it might've made it impossible for Republicans to agree to anything of the kind. As it is, the White House defined an extension of the tax cuts for the rich as a loss for them -- and now they're going to extend those tax cuts, and lose. They were not playing for this outcome.

But though they're coming out on the wrong side of the short-term politics and the wrong side of the tax policy, they may be coming out with a win on stimulus that no one expected, and that may ultimately matter much more for both the economy and Obama's reelection campaign.

Photo credit: By Jewel Samad/AFP/Getty

By Ezra Klein  | December 6, 2010; 12:27 PM ET
Categories:  2012 Presidential, Taxes  
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Comments

2012 is still a very long way off.
imagine all that could happen to change world events, national events, between now and then.
one single event could change perceptions in any direction.

my guess is that there will be great support for barack obama by the time the next election rolls around.
the gods step in with perfect timing.

Posted by: jkaren | December 6, 2010 12:34 PM | Report abuse

A Pollyanna-ish view, don'tcha think? What do you know about economic policy that Paul Krugman doesn't know?

Posted by: scarlota | December 6, 2010 12:34 PM | Report abuse

I think you might be right, what I question is whether this is acceptable. Should I care whether or not the current administration actually wins the next election, or gets a primary challenge for that matter? Weren't we supposed to be interested in better governance, efficient spending, and the other campaign promises? And by the way, if the stimulus failed to keep unemployment below 8%, isn't it logical that the Bush tax cuts ALSO failed to keep unemployment below 8%? My fear is that this is too little stimulus, and it provides fodder for yet more tax cuts.

You know the Reps, cuts are the cure for whatever ails you.

Posted by: rcd2 | December 6, 2010 12:35 PM | Report abuse

"they may be coming out with a win on stimulus that no one expected, and that may ultimately matter much more for both the economy and Obama's reelection campaign."

Maybe Ezra.

But look at these powerful figures from Paul Krugman's column today:

"A few months ago, the Congressional Budget Office released a report on the impact of various tax options. A two-year extension of the Bush tax cuts, it estimated, would lower the unemployment rate next year by between 0.1 and 0.3 percentage points compared with what it would be if the tax cuts were allowed to expire; the effect would be about twice as large in 2012."

That's unemployment of only a quarter to a half point lower in 2012. In exchange the deficit projections will be $4 trillion higher over the first decade. Hard to say which is worse for re-election. Plus, with the tax cuts ending and deficit projections dropping by tens of trillions over coming decades, you'd have to think Bernanke and the Fed would be significantly motivated to do more. This could completely counteract even the quarter to half point increase in unemployment, bringing it to zero negative.

Other issues are that the middle class would feel a tax increase, and on the plus side, not giving in wouldn't demoralize the base, and wouldn't make Obama look spineless yet again.

You have to wonder what's going on in that always scared of looking too liberal and not post partisan fairyland enough head of Obama.

Posted by: RichardHSerlin | December 6, 2010 12:43 PM | Report abuse

OBAMA SURRNEDER
It is too bad that the much outspoken and speech-king President;Obama, who has won his election to undo many wrong policies of George Bush including 700 billion dollar tax bonus to the 2% wealthy Americans, Afghan and Iran Wars and several other issues 2 years ago has rather than stand-up to his plans, programs and policies; he timidly surrendered to the Tea Party hawks and brokers of millionaires and billionaires within few days.
President Obama, 31st December dead line is still 25 days away but looks like you are very eager to enjoy your Christmas you have shamefully hand over the biggest win to the enemies of poor and middle class and dumped millions; who have whole heartily supported your race, color and Presidency in a hope that you will surely bring a CHANGE but looks like you are changed very easily and timidly.
If the tax rates to the middle class would have been raised along with others, sky could not have been fallen; but the Americans would have woke up and Republicans would have surrender, BUT YOU HAVE FAILED US. No more we will defend YOU. You will remain a one-term President in our history, that is SURE.

Posted by: citysoilverizonnet | December 6, 2010 12:45 PM | Report abuse

Ezra, luv ya man, but rationalizing this defeat ain't the way.

Posted by: mrmoogie | December 6, 2010 12:53 PM | Report abuse

EZRA EZRA EZRA

Where did that $100 billion figure come from?

Who will "pump" that money? Middle class or the wealthy?

What makes you think the Bush tax cuts will create jobs in the future when in fact they didn't in the past?

Here's something smarty pants economists need to think about: FOr the two scenarios below, assume a given person who is making $300,000 taxable income per year....

Scenario A (Bush Tax cuts for me get extended): That means I can continue hoarding my money as has happened in the last few years. Nothing changes, so I ain't changing either. End result, economy not improved.

Scenario B (Bush cuts for me don't get extended): Hmmm. Something has changed. I need to act NOW otherwise I lose money to the government next year. That means I need to create new/more business related deductions. And that means I need to create more business expenses. And that means I need to stop hoarding my money as I have done for the last few years and start trying to use it to turn a profit somehow, and that means hiring people or at the very least putting my savings/hoardings to work by pumping it into the economy somehow, which in turn will create more jobs if everyone like me acts proactively to protect their hoardings.

In summary: THOSE WHO SAY EXTENDING THE BUSH TAX CUTS FOR THE WEALTHY WILL IMPROVE THE ECONOMY ARE PROBABLY WEALTHY AND ARE SAYING IT TO KEEP THEIR TAX RATES LOW--AND INSTEAD THE BEST WAY TO IMPROVE THE ECONOMY IS TO INCREASE TAX RATES FOR THE WEALTHY SO THEY WILL USE THEIR HOARDINGS FOR BUSINESS AND SO THAT CORPORATIONS WILL STOP HAVING INCENTIVES TO PAY EXECS HIGHER SALARIES AND INSTEAD USE IT AS R&D OR AS HIRING.

Posted by: lauren2010 | December 6, 2010 12:53 PM | Report abuse

So, it looks like from what's been reported that Obama may not be getting enough stimulus in return in his negotiations for this to benefit him more than it will cost him in the 2012 elections.

But there's also this:

"That means the next fight over the tax cuts will be part of the 2012 election. And the White House believes that an improved economy and a bigger deficit will make it much harder for Republicans to support extending tax cuts for the rich. If they try, that gives Democrats both a populist cudgel and a way to take hold of the deficit issue."

True?

Will Obama and the Democrats fight?

Who will get the message out stronger or better?

And -- very importantly -- will unemployment not still be high in 2012, making the Republicans still the ones with the bludgeon, and then they claim that unemployment is still high because the tax cuts weren't made permanent, and now they all should be -- this looks like a treacherous strategy, since I recall seeing estimates that unemployment will still be high in 2012. And even if it isn't Republicans will say you will wreck this recovery if you raise taxes. This looks like a risky treacherous strategy.

That's something to think about.

Posted by: RichardHSerlin | December 6, 2010 12:54 PM | Report abuse

A math/definition question. If the Bush extension is $4 Trillion over 10 years wouldn't that be (roughly) $800 billion itself over two years? How did you get $300 billion after adding in the other stuff?

Posted by: chaboard | December 6, 2010 12:57 PM | Report abuse

Why haven't the Dems used reconciliation to extend tax cuts for the middle class and allow the current Bush tax cuts to die?

Bush had no problem getting 51 reconciliation votes to create these tax cuts.

The Dems could use reconciliation NOW to get what they SAY they want.

In short, Democrats are lying about their desire to end the Bush tax cuts for the wealthy because they personally benefit from them.

Liberals are being fooled by these imposters (and that includes Obama).

Posted by: lauren2010 | December 6, 2010 12:58 PM | Report abuse

Ezra

This post of yours is the WORST EVER. It is a POS.

Read the above comments (especially mine) and please respond.

Posted by: lauren2010 | December 6, 2010 1:00 PM | Report abuse

"Can the White House win in 2012 by losing on the Bush tax cuts now?"

Um, clearly not, Homer.

Dumb question.

Posted by: lauren2010 | December 6, 2010 1:04 PM | Report abuse

So Ezra's joined the Voodoo Economics school of thought? If the so-called Bush tax cuts didn't act to stimulate the economy enough this year and last, why are they going to suddenly work next year? This isn't really a tax "cut" in the literal sense of the word, it is just a continuation of the tax regime of the last ten years, which has worked out so well for us. Sure, the spin could be we aren't going to get a tax increase, but calling this a stimulative cut is ridiculous.

Posted by: AuthorEditor | December 6, 2010 1:06 PM | Report abuse

Part of me has always thought that the sturm and drang within the left-leaning professional left has been a bit overblown. I mean, ask yourself this: why isn't Nate Silver or Jane Hamsher or David Leonhardt or Josh Marshall a senior White House advisor? I don't say this to denigrate the work any of these people do (well, maybe Jane Hamsher), but to point out that when you step back and take a slightly longer-term persepctive on things, many of the direst predictions turn out to be incorrect.

So now today Ezra starts thinking "well, the Democrats have screwed this up so badly that they've doubled back on the Republicans and now they're getting a reasonably good deal out of it". When you could just as easily wonder "Did they know this all along?". I mean, the Republicans have been making noise about cutting unemployment benefits for a long time and the tax cuts have been on the table for a long time. Isn't it possible that behind closed doors somewhere, some Democratic strategists sat down and thought that they had a hand to play and why not play it to ensure that unemployment benefits continue? Plus, if you step back from the embittered liberal perspective (of which I am a card-carrying member), what is the real harm in extending the tax cuts for everyone? It is probably mildly stimulating, as Ezra points out, and no one really gives a hoot about the deficit. So, extend them. But make sure you get something in return.

And yes, it is awesome to be as naive as I am.

Posted by: klautsack | December 6, 2010 1:07 PM | Report abuse

Ezra,

You should try to quantify the stimulative effects before writing this post. I doubt that $100 billion in tax cuts weighted toward the wealthy will dent the unemployment figure.

Posted by: spekny | December 6, 2010 1:11 PM | Report abuse

klautsack

If you believe deficits matter (and they do), then the harm is that these needless tax cuts for the wealthy will increase the deficits, and therefore starve out more important programs or investments now or later.

Also, there is political harm to progressives because they will be blamed for these growing deficits.

Posted by: lauren2010 | December 6, 2010 1:15 PM | Report abuse

No, no, no. This issue is now beyond policy. Capitulation is not an option for many of us staunch Obama supporters. Although most of us supported him because he was NOT cut from that that disgustingly pure political fabric, we need President Obama to play politics now and show some guts. No compromise on the tax cuts for the wealthy.
The best suggestion I've heard so far is to call the Republicans bluff, let all of the tax cuts expire since they refuse to pass them, and then create Obama tax cuts the way they should be written.
I can't help but wonder what in the heck is being said in the proverbial back room to have President Obama so afraid to stand on his convictions??? Do they have dirt on him? Are they threatening to kill his family?? What??
This particular issue should be open and shut. The people are united on this one.
Whew!

Posted by: maljazur | December 6, 2010 1:31 PM | Report abuse

lauren2010 - But the portion we're discussing is only about a quarter of the total price tag for the tax cuts. So, in effect, even dyed-in-the-wool liberals don't actually care about the deficit, they care more about the principle that the rich get off too easily. But that principle evaporates pretty quickly if everyone's taxes go up.

We'll see.

Posted by: klautsack | December 6, 2010 1:32 PM | Report abuse

Ezra, GET REAL. Populist cudgel? The Congressional Dems (and Obama) have to be the most incompetent people in this country. Not only do they negotiate against their own best interests, they don't back up their efforts by spelling out why things need to be done a certain way and repeatedly reinforcing that, they give political cover to Republicans by saying that they have "legitimate differences in philosophy" when it doesn't really always apply to the argument being made, and when actually getting an opportunity to tell people why the Republicans are wrong or just telling them that Republicans are the reason why progress is being held up (hello, 41 Senators holding up the progress of all of Congress - Pelosi passed how many bills in the House that weren't voted on in the Senate?), they completely ignore it, postpone it, or relinquish all possession of the potential victory (sometimes, in the spirit of a nonexistent bipartisanship).

It's astounding how stupid they are. How many times in 2 years has Obama given Republicans an opportunity to be bipartisan? How "liberal" have these bills actually been? They've been more practical and pragmatic (moderate Republican) than liberal... and when I say "pragmatic", I mean it as a euphemism. It's a joke. This is basically a step-up from the status quo. So, there have been "legislative victories". BFD. When you examine what's actually been passed, it's not clearing a path for people to get back to work. It's not making things cheaper for people. It's only, ONLY making the business environment good for businesses and trying to keep the gov't afloat.

Is this the best we can do? This isn't the change that *I* voted for. Bush screwed this gov't up, politically and financially. Obama is too weak to deal with the politics. He's not dealing with the GOP in a smart way. Unilateral capitulation is not compromise. And by the way, bipartisanship is a means, not an end. These bills are bipartisan in spirit, even with no GOP votes. You negotiate for necessary things in a bill, but you DON'T START TO JUST LEFT OF CENTER in doing that.

Bush moved this country to the right, by skewing the national conversation on issues. National wiretaps and torture or justifying these would not have been permitted by people in the past, GOP or Dems. Obama has allowed it to move further to the right, by not arguing why the changes he supposedly wanted were needed and letting the GOP off the hook.

Part of it is that Americans today are busy and/or stupid. You shouldn't have to explain WHY Wall Street needs reform. You should explain HOW it will be, but not WHY. Didn't we just go through a financial meltdown 2 years ago? It's visibly affected the economy. Look at jobs, look at consumer demand, 401(k) and invested dollars were lost - big businesses and the Dow are doing wonderful NOW - but slow hiring and a lack of loans & fixes, still.

Same with HCR, etc.

Dems have public opinion on their side. Just too stupid to use it.

Posted by: fbutler1 | December 6, 2010 1:36 PM | Report abuse

So by allowing the GOP to claim victory over the tax cuts and tying it to more stimulative measures, the GOP will say tax cuts are what helped.
.
That helps Obama in 2012 how exactly? By mixing the recovery plans together, both sides get to claim their part did it.
.
Which means that the GOP 'victory' will be more important than the the Dems caving to the GOP. Image is everything as they say and the Dems 'image' currently sucks, even if the actual stuff behind that image is pretty good.

Posted by: rpixley220 | December 6, 2010 1:39 PM | Report abuse

Obama is not just selling himself out- he is selling out the American people. He needs to call to account these Republican junkyard dogs who are holding 98% of the country hostage to the wealthiest 2%. How about some backbone Mr. President?

Posted by: jeffl240 | December 6, 2010 1:40 PM | Report abuse

Democrats seem to be perpetually getting ready for the next fight, rather than trying to win this one. Why should Democratic voters believe that they'll reverse the Bush tax cuts in two years instead of caving again? They don't exactly have the best record over the past few years of shooting down tax cuts (instead of moving to 'the center'). Revealed preference, man, revealed preference.

Posted by: goinupnup | December 6, 2010 1:41 PM | Report abuse

The polling data masks an important point. That is, only 35% of Americans support tax breaks for the wealthy, BUT 70% support tax breaks for themselves. Meaning, it easy to deny someone else's tax cuts as the polling shows, but never bet against tax breaks and cheap gas. Never.

Dems won't win on raising taxes during hard economic times. Best to cave now, cower and allow the tax cuts to continue. The recent election clearly proved Americans care more about tax cuts than the deficit. I think most of America believes what Cheney said: deficits don't matter. What evidence do we have they do? It's the same analogy with the global warming prognosticators. Hey, we had record snows in DC last winter, right Mr. Inhofe? What global warming? What deficit doom? Show me!!

The Dems need to do whatever the devil wants to get the economy rolling again. Who cares if it looks bad now. Two years in politics is and eternity. If the economy is any improved in 2012, the reelection is a slam dunk and Ms. Palin can stay in AK and continue her travelogues.

Posted by: citizen4truth1 | December 6, 2010 1:42 PM | Report abuse

Democrats seem to be perpetually getting ready for the next fight, rather than trying to win this one. Why should Democratic voters believe that they'll reverse the Bush tax cuts in two years instead of caving again? They don't exactly have the best record over the past few years of shooting down tax cuts (instead of moving to 'the center'). Revealed preference, man, revealed preference.

Posted by: goinupnup | December 6, 2010 1:44 PM | Report abuse

Ezra - thank you for at least conceding that there is a reasonableness to this compromise - both from a political and policy standpoint - that sets things up for 2012 while still pumping money into the economy. The fundamental political reality underpinning this entire debate is that other forms of stimulus are not, not, not going to come from Capitol Hill for the next 2 years. Maybe some amount of infrastructure spending, but other than that nothing. So this is the next best thing; we at least avoid excessive fiscal retrenchment, though granted at the cost of less bang for our fiscal buck.

Posted by: reader44 | December 6, 2010 1:51 PM | Report abuse

I just in awe of this entire debate. Someone mentioned on twitter that no one would have thought this administration could push healthcare through and fail at stopping the tax cuts for the rich.

When you talk about this being the discussion in 2012, that actually makes me more nervous for Democrats. What if the economy improves by then and American go back to thinking they're one lottery ticket or good idea from being Bill Gates? If the Dems can't make the case for the middle class at a time when the middle class is actually somewhat steeped in their financial reality, how will they make it in 2012?

Talk about PR blues.

Posted by: MediaStrutdotcom | December 6, 2010 2:03 PM | Report abuse

Ezra, you are one clever dude. I hope you're right.

Posted by: DavidH3 | December 6, 2010 2:03 PM | Report abuse

I think this is being overly optimistic. The Republicans will turn around in 2012 and blame deficit expansion on the Democrats, saying they loaded up the tax cut extension with a bunch of entitlements and give-aways. The Democrats will end up fumbling around for a response again and the GOP will own the debate. This is getting really way too predictable.

Posted by: jporter1000 | December 6, 2010 2:04 PM | Report abuse

the fact that reelection is all obama thinks about is the reason obama should not be reelected...

Posted by: DwightCollins | December 6, 2010 2:04 PM | Report abuse

Good for Obama. He's not going to get rolled by his boss Pelosi anymore.

Who really cares what these liberals think?

Posted by: krazen1211 | December 6, 2010 2:09 PM | Report abuse

"The tax cuts for income over $250,000 will pump about $100 billion into the economy over the next two years...."

Where's the proof???

Posted by: rulane | December 6, 2010 2:13 PM | Report abuse

"Why haven't the Dems used reconciliation to extend tax cuts for the middle class and allow the current Bush tax cuts to die?

Bush had no problem getting 51 reconciliation votes to create these tax cuts."

Because they didn't pass a FY2011 budget.

Posted by: krazen1211 | December 6, 2010 2:13 PM | Report abuse

Obama proves daily he is over his head and incapable of leading on any issue. Name one issue he has provided strong leadership? There are none. He's finding out very quickly that it is much easier to criticize than actually lead. This is easily the most incompetent administration ever and every day Obama shows why gov't should be smaller....they are ineffective, inefficient and incompetent.

Posted by: Tostitos | December 6, 2010 2:14 PM | Report abuse

Wow... are you bucking for the role of the White House's best apologist?

I am a Progressive Democrat and I think this is B.S. We have a big problem with DEBT... the deficit is just a yearly indicator of how fast its getting worse. We currently pay almost $1 out of $5 of the federal budget to INTEREST ON DEBT!!! (19%). We need a balanced budget and we need it soon.

So the idea that the deal these "budget minded" Republicans are going to make with the Administration is "If you green light my spending, I'll vote for your spending" is awful.

Let all the tax cuts expire.
Let unemployment benefits end at 99 weeks... or even reduce it to 55 weeks.
Tax big corporations like Exxon
End the wars in Iraq and Afghanistan (and not by leaving 50,000 troops there!)

That is what our country needs. Not some mealy mouthed bull $#@!

Posted by: pdxgeek | December 6, 2010 2:14 PM | Report abuse

No one President in the World can afford to gamble on such a huge giveaway as the Bush tax cuts for the rich, as Obama is doing by rationalizing that he will be able to stop a permanet extension in 2012 by kicking the can down the road now. He won't be around.
After the cave-in on the public plan, capitulation to this obscene Republican blackmail on tax cuts will be the last nail on his Presidential coffin. He has already lost most of his Independent voters, from now on he will lose a great number of Democrats, for in middle America, Presidential courage is more important than compromise, particularly with people that have their foot on your neck.

Posted by: lionelroger | December 6, 2010 2:17 PM | Report abuse

No one President in the World can afford to gamble on such a huge giveaway as the Bush tax cuts for the rich, as Obama is doing by rationalizing that he will be able to stop a permanet extension in 2012 by kicking the can down the road now. He won't be around.
After the cave-in on the public plan, capitulation to this obscene Republican blackmail on tax cuts will be the last nail on his Presidential coffin. He has already lost most of his Independent voters, from now on he will lose a great number of Democrats, for in middle America, Presidential courage is more important than compromise, particularly with people that have their foot on your neck.

Posted by: lionelroger | December 6, 2010 2:18 PM | Report abuse

Who's the bigger idiot?

Krazen or Ezra

Well, they both have z's in their name.

Ezra has a lot to answer for in this thread for his ridiculous post. If he doesn't, that means he doesn't read his comments or doesn't care.

Posted by: lauren2010 | December 6, 2010 2:18 PM | Report abuse

Ezra, you are on the right track:

This deal of $100 billion of tax cuts for the rich in return for $180 billion of stimulus tax cuts is actually better than a permanent extension of the middle class tax cuts for the following reasons:

It does more to stimulate the economy and help the poor: The "middle class" tax cuts on their own don’t do that much to stimulate the economy. Under the plan, a millionaire would get $7000, while someone making under $10,000 only get $50.

It is actually better for the deficit: Over the next ten years, a permanent extension of the middle class tax cuts will add $3.2 trillion. This money will have to be paid back eventually. In order to raise taxes, Democrats would need the House, 60 senators, and the President to agree to change the existing law. In order to get regressive spending cuts, Republicans just need to control one branch of government and refuse to vote/sign for any bill that spends more than x. Because Republicans oppose any form tax increase, it will more likely be paid back with future spending cuts which will hurt the poor and middle class more than making these tax cuts permanent will help them.

Making the tax cuts temporary gives Obama an upper-hand in negotiations with the GOP: If the economy is still bad, he can extend them for further stimulus. If the deficit is the main issue, he can extend them in return for reducing wasteful tax credits. If the Republicans don’t play ball, Obama can just let tax rates go up and put the debt back on a sustainable track. If the tax cuts are permanent, the Democrats lose any leverage in negotiation.

It is the only way these stimulus measures can possibly pass: Because the Republicans will take control of the House next year, Obama cannot pass the stimulus programs necessary to jump start the economy. Should these unemployed people who are suffering the most from this recession be denied the benefits necessary to survive just because Democrats want to save $100 billion? Progressives need to show that they care more about helping the poor than sticking it to the rich.

Posted by: wcampb17 | December 6, 2010 2:20 PM | Report abuse

Huh?
Hope?
Change?

Posted by: NYClefty | December 6, 2010 2:21 PM | Report abuse

The President has been outfoxed by the Republicans again. Obama apologists are almost out of credibility. Defending Obama's weakness and incompetence could be the definition of "putting lipstick on a pig."

Posted by: ram_lopez | December 6, 2010 2:22 PM | Report abuse

"Scenario B (Bush cuts for me don't get extended): Hmmm. Something has changed. I need to act NOW otherwise I lose money to the government next year. That means I need to create new/more business related deductions. And that means I need to create more business expenses. And that means I need to stop hoarding my money as I have done for the last few years and start trying to use it to turn a profit somehow, and that means hiring people or at the very least putting my savings/hoardings to work by pumping it into the economy somehow, which in turn will create more jobs if everyone like me acts proactively to protect their hoardings."

Who on earth deluded you into thinking this utter crap?

Posted by: krazen1211 | December 6, 2010 2:24 PM | Report abuse

Talk about putting lipstick on a pig ...

Posted by: peter2001 | December 6, 2010 2:25 PM | Report abuse

@maljazur:

"I can't help but wonder what in the heck is being said in the proverbial back room to have President Obama so afraid to stand on his convictions???"

*********************

You're assuming Obama HAS convictions. That he's not an empty suit reading what he's told to off a teleprompter.

Posted by: pmendez | December 6, 2010 2:26 PM | Report abuse

"I think you might be right, what I question is whether this is acceptable. Should I care whether or not the current administration actually wins the next election, or gets a primary challenge for that matter? Weren't we supposed to be interested in better governance, efficient spending, and the other campaign promises? And by the way, if the stimulus failed to keep unemployment below 8%, isn't it logical that the Bush tax cuts ALSO failed to keep unemployment below 8%? My fear is that this is too little stimulus, and it provides fodder for yet more tax cuts."

Actually, the Bush tax cuts kept unemployment below 8% for Bush's entire Presidency. It's only in February 2009 that unemployment crossed that figure once the spread the wealther came into office.

Posted by: krazen1211 | December 6, 2010 2:26 PM | Report abuse

If Obama caves on tax cuts, it's only because Republicans forced him to do it. He gets no credit for that.

But he will get the blame from the left.

Posted by: diesel_skins_ | December 6, 2010 2:27 PM | Report abuse

The President has been outfoxed by the Republicans again. Obama apologists are almost out of credibility. Defending Obama's weakness and incompetence could be the definition of "putting lipstick on a pig."

Posted by: ram_lopez | December 6, 2010 2:22 PM | Report abuse
*************************
Sadly, I agree. I am tire of defending him.

Compromise of blackmail? You make the call.

This is one Progressive who is hanging up the hat.

Posted by: sherardg | December 6, 2010 2:29 PM | Report abuse

Nobody will believe Barack Obama anymore - and the shouldn't.

I wish he would make the ultimate bipartisan agreement ... in exchange for Repulicans agreement to middle class tax cuts Obama will agree not to run in 2012.

That's a bipartisan agreement all sides will be happy to support.

Posted by: alberte1 | December 6, 2010 2:30 PM | Report abuse

Here are two excellent ideas on how we can fund the government:

In response to another article, Airborne82 wrote today:

"The Department of Commerce should Tax stock trades and gambling transactions a fraction of a penny to fund jobs and infrastructure legislation. There are over $4 Trillion in trades every single day. A minuscule tax of less than a penny on each trade could fund American manufacturing and Job creation....The Fed should demand a bigger cut of the Wall Street Derivatives market. A $600 Trillion Market should be taxed higher to Regulate Risk and Reward and fund Jobs and Unemployment. That’s the least Wall Street can contribute to the 8 Million workers who lost Jobs, Homes and Businesses because they (Wall Street) used people and communities life savings to gamble on Derivatives, Swaps, CDOs and Commodities while awarding themselves Hundreds of Billions."

I think those are excellent ideas and creative solutions! Let's repeat these ideas over and over in various blogs, etc., as well as sending them over and over to our representatives in Congress and the SEC until they are a reality.

Posted by: foofoofoo | December 6, 2010 2:30 PM | Report abuse

When politicians say they want to make a deal in the worst possibly way, that is the way they do it.
Do they not think despite the media being in their pocket, that the American public is totally stupid not to know they are being played? It may take awhile but I stll believe "You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time."
There will be a reckoning.
Best I've heard this is a deal for the next Republican president to appoint Obama to the SCOTUS where he will take Thomas's distinguished chair.

Posted by: JTinAlex | December 6, 2010 2:31 PM | Report abuse

"It's astounding how stupid they are. How many times in 2 years has Obama given Republicans an opportunity to be bipartisan? How "liberal" have these bills actually been? "

Here comes the nonsensical liberal point of view. Transforming the fast growing united states into slow growing europe by enacting unneeded liberal policy like Universal Health Care is not a moderate policy no matter how you write it. It's partisan dung.

Posted by: krazen1211 | December 6, 2010 2:32 PM | Report abuse


It looks pretty bad for the left. How can they vote for Obama now?

Afghanistan, Gitmo, Global Warming, Government Option, and now Taxes.

Just stay home on Election day.

Posted by: L1ncon | December 6, 2010 2:32 PM | Report abuse

When politicians say they want to make a deal in the worst possibly way, that is the way they do it.
Do they not think despite the media being in their pocket, that the American public is totally stupid not to know they are being played? It may take awhile but I stll believe "You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time."
There will be a reckoning.
Best I've heard this is a deal for the next Republican president to appoint Obama to the SCOTUS where he will take Thomas's distinguished chair.

Posted by: JTinAlex | December 6, 2010 2:33 PM | Report abuse

Hey Erza Klein! How about you start rooting for our country! Instead of rooting for political parties?!?!?!


How about the American people win something for a change?!?!?!

Posted by: FormerDemocrat | December 6, 2010 2:33 PM | Report abuse

They win with me, but probably not with a lot of progressives. Sometimes I think progressives would let the Republicans tank START, tax cuts and unemployment benefits for millions of the dying middle class just to make a point.

For me, it has been clear the GOP is willing to hold hostage national scrurity (START) and the unemployed (unemployment extensions, middle class tax cuts). The GOP holds these items hostage to get extensions of the huge deficit-causing tax cuts for bailed out CEOs and bankers who are sitting on billions while the middle class is without jobs.

Most voters might not remember, but I, for one, will.

Posted by: tinyjab40 | December 6, 2010 2:34 PM | Report abuse

Interesting perspective re: unexpected stimulus = tax cuts extended + unemployment extended.

So much for the deficit as a priority?

I don't expect Obama to get any credit for it.
And his enemies in Congress will keep beating him up relentlessly with usual relentless barrage of lies and misleading comments.

So in a way this is a two way sucker punch with Tea Party and Progressive talking significant hits I guess.


Posted by: mickster1 | December 6, 2010 2:35 PM | Report abuse

jimmy carter all over again.

Posted by: sherardg | December 6, 2010 2:35 PM | Report abuse

How? how on this earth can anyone, by now, after all that has happened, not understand that the lying, duplicitous, conniving GOP / T Party lapdogs will find some evil way to use this against Mr. Obama?

On top of that, he is losing his own base just for TALKING to these disgusting greedy people, people like Mitch McConnell, a truly poisonous, cynical, greedy man so arrogant and deferential to the wealthiest of the wealthy that is defies belief.


Posted by: StevenK3 | December 6, 2010 2:35 PM | Report abuse

President Obama wins with me, but probably not with a lot of progressives. Sometimes I think Progressives would let the Republicans tank START, tax cuts and unemployment benefits for millions of the dying middle class just to make a point.

For me, it has been clear the GOP is willing to hold hostage national scrurity (START) and the unemployed (unemployment extensions, middle class tax cuts). The GOP holds these items hostage to get extensions of the huge deficit-causing tax cuts for bailed out CEOs and bankers who are sitting on billions while the middle class is without jobs.

Most voters might not remember, but I, for one, will.

Posted by: tinyjab40 | December 6, 2010 2:35 PM | Report abuse

The irony of this impasse, particularly on behalf of Obama is simply this:

For two years Obama, Reid and Pelosi and the Dem majority 'crammed' down the throats of the American people endless negative legislation which will impact us for years to come.

There was no 'bipartisan' debate on any of these procedures - it was only what Obama and the liberal base of the Dem Party (SEUI, etc) desired.

Now that Obama and the liberals in Congress have sacrificed 60 seats in the House and 7 in the Senate, the worst 'whipping' either party has taken in 60 years, this 'farce of a president' now desires 'bipartisanship'.

Bipartisanship to Obama is getting what he wishes to satisfy his ideology regardless of the sacrifice others have to undergo.

Anyone who does not fall into that category becomes the party of 'no', regardless of whether they are Repubs, Tea Party or moderate Dems.

What this man has not yet grasped is that the American public is absolutely fed up with this administration and Congress in its entirety. We do not want 'politics as usual' to continue.

They continue their inane bickering like juvenilte delinquents, which frankly speaking, are what they truly have become.

The people of this nation do not wish to be controlled by a central government - as a group we have allowed that to happen during the past 60 years and now, as a group we have discovered how assinine that path has been.

As one who is nearly 80 years of age I would suggest to all that you go back and study very closely the past 60 years. You will see that the Democrat Party has fulfilled the complete venue of the Socialist Party of the U.S. as espoused by Norman Thomas up until the 1944 election.

In his last speech in 1944 this is his statement:

"The American people will never knowingly adopt socialism. But in the name of liberalism they will adopt every fragment of the socialist program, until one day America will be a socialist nation without every knowing how it happened.

I no longer need to run as a Presidental Candidate for the Socialist Party.

THE DEMOCRAT PARTY HAS ADOPTED OUR PLATFORM."

"A liberal is someone who feels a great debt to his fellow man, which debt he proposes to pay off with your money".

"Government iss the great fiction, through which everybody endeavors to live at the expense of everybody else".

Federic Bastiat, French economist (1801-1850)

Perhaps we should begin to heed the advice of these intelligent men in our history.

It appears that the 'experts' of today (and who has christianed them experts) are not nearly as intelligent as the Founding Fathers.

Our government as it now exists is nothing more than a putrid cesspool of self-serving, egotistical ideologues who are of the belief that they are the only ones intelligent to know what is good for us.

To that I simply state: Hogwash


Posted by: dharper2 | December 6, 2010 2:36 PM | Report abuse

President Obama wins with me, but probably not with a lot of progressives. Sometimes I think Progressives would let the Republicans tank START, tax cuts and unemployment benefits for millions of the dying middle class just to make a point.

For me, it has been clear the GOP is willing to hold hostage national scrurity (START) and the unemployed (unemployment extensions, middle class tax cuts). The GOP holds these items hostage to get extensions of the huge deficit-causing tax cuts for bailed out CEOs and bankers who are sitting on billions while the middle class is without jobs.

Most voters might not remember, but I, for one, will.

Posted by: tinyjab40 | December 6, 2010 2:35 PM | Report abuse

***************************
Since when is it ok to COMPROMISE with terriorist, or extorionists?

THINK ABOUT IT.

Posted by: sherardg | December 6, 2010 2:38 PM | Report abuse

When do the American people win? when do those who do not belong to unions, tort lawyers, NOW, etc. win? I am getting disgusted with this "zero sum" game I hear. Somebody must lose to move forward. Are we so lacking in leadership that the only wuestion that can be asked is who wins/who loses? What has happened to the American concept of compromise? Do we so mistrust each other that all we can think of is - they won/we lost? Someone please tell me this is a nightmare and I will soon wake up from it!

Posted by: fcrucian | December 6, 2010 2:39 PM | Report abuse


You will see Mitch McConnell and John Boehner turn this latest compromise against President Obama.

They will find a way to tie it around his neck and strangle him politically.

Every time Mr. Obama compromises with these semi-conscious, sleepwalking, blood-sucking zombies, he loses.


Posted by: StevenK3 | December 6, 2010 2:40 PM | Report abuse

Not sure how this can be a win for the White House. If anything, it shows weakness, IMO.

The way I see it, Republicans are willing to gouge the middle class and show little empathy for those who are unemployed all because the wealthiest would have to pay more taxes.

Obama SHOULD veto any legislation that extends tax benefits for those earning over $250,000.

And if the unemployment benefits for countless Americans expire as well, both of these issues because political fireballs.

Recent economic history proves that trickle down does not work. The wealthiest are not the backbone of this country's financial skeleton.

Posted by: sloppyawn | December 6, 2010 2:40 PM | Report abuse

So how did that rising tide, boat floaty thing work out for Bush? Oh? Right! That was Ronnie who proved "deficits don't matter.".

Posted by: LHO39 | December 6, 2010 2:40 PM | Report abuse

"So how did that rising tide, boat floaty thing work out for Bush? Oh? Right! That was Ronnie who proved "deficits don't matter."."

You mean when the economy grew from $10 trillion to $14 trillion?

Posted by: krazen1211 | December 6, 2010 2:43 PM | Report abuse

Ezra: "Can the White House win in 2012 by losing on the Bush tax cuts now?"

The answer is "Of course." It is a tempest in a teapot.

This whole thing is about the use of taxes and deficits as propaganda framing issues. On the one hand, Republicans and conservatives use a certain load of gibberish, while on the other hand, liberals and progressives are angry because it makes the Democrats look weak. Most Americans really don't care about either side. Right now, we just need jobs.

For a more comprehensive framework of the current shenanigans, send people these links, to look at:

Bush Tax Cuts - (from 2006, & still going strong)
http://www.youtube.com/user/leearnold#p/u/3/SA1f2MefsMM

Social Security - (made in 2005, etc.)
http://www.youtube.com/user/leearnold#p/u/4/Tts2uTWt6e8

Posted by: Lee_A_Arnold | December 6, 2010 2:44 PM | Report abuse

When do the American people win? when do those who do not belong to unions, tort lawyers, NOW, etc. win? I am getting disgusted with this "zero sum" game I hear. Somebody must lose to move forward. Are we so lacking in leadership that the only wuestion that can be asked is who wins/who loses? What has happened to the American concept of compromise? Do we so mistrust each other that all we can think of is - they won/we lost? Someone please tell me this is a nightmare and I will soon wake up from it!

Posted by: fcrucian | December 6, 2010 2:39 PM | Report abuse
**************************
"Are we so lacking in leadership that the only wuestion that can be asked is who wins/who loses? What has happened to the American concept of compromise? "

Yes. Are we compomising when a party puts out a memo saying we will not compromise until we get what we want first. Is holding up the congress on the plight of unemployed americans a compromise are neuclear treaty until we fill up the millionares slop bucket compromise?

Posted by: sherardg | December 6, 2010 2:46 PM | Report abuse

When do the American people win? when do those who do not belong to unions, tort lawyers, NOW, etc. win? I am getting disgusted with this "zero sum" game I hear. Somebody must lose to move forward. Are we so lacking in leadership that the only wuestion that can be asked is who wins/who loses? What has happened to the American concept of compromise? Do we so mistrust each other that all we can think of is - they won/we lost? Someone please tell me this is a nightmare and I will soon wake up from it!

Posted by: fcrucian | December 6, 2010 2:39 PM | Report abuse
**************************
"Are we so lacking in leadership that the only wuestion that can be asked is who wins/who loses? What has happened to the American concept of compromise? "

Yes. Are we compomising when a party puts out a memo saying we will not compromise until we get what we want first. Is holding up the congress on the plight of unemployed americans a compromise are neuclear treaty until we fill up the millionares slop bucket compromise? I don't think so. Bush never got pushed around like this.

Posted by: sherardg | December 6, 2010 2:47 PM | Report abuse

This sounds all well and good but the price is bigger - President Obama will lose this moderate democrats' support if the tax cuts for the wealthiest get extended one day. I will not even hold my nose to vote for him in 2012.

Posted by: romano2 | December 6, 2010 2:48 PM | Report abuse

Obama's "opening gambit" on the 2012 election was his inauguration speech. He disgracefully attacked his predecessor while claiming to set a "new tone" for Washington. His attacks continued until last month, when his party was rejected at the polls. Every action that Obama takes and has taken is related to his re-election.

Posted by: doug7772 | December 6, 2010 2:48 PM | Report abuse

Ezra, Today U-R off. Obama is OUT. Primary challenges are abound. Dean- Hillary? The Progressives are done with him and so is the center and the right? PLEASE! He has no base or hope and his arrogance is so glaring "I want to be liked by all" -it is the new cloths the emperor never wore.He cheated in the primaries, took Hilary's N. Jersy's delagates and Texas,Co., etc. He should pay the price and resign ASAP; the damage being done is catastrophic and may end our country as we now it.
Ezra today U R too story book.
Reality is needed and congress should obstuct any deal this hack makes stickly for himself.
DUMP DURBIN/REID as well.Flounders.

Posted by: crrobin | December 6, 2010 2:49 PM | Report abuse

Scenario B (Bush cuts for me don't get extended): Hmmm. Something has changed. I need to act NOW otherwise I lose money to the government next year. That means I need to create new/more business related deductions. And that means I need to create more business expenses. And that means I need to stop hoarding my money as I have done for the last few years and start trying to use it to turn a profit somehow, and that means hiring people or at the very least putting my savings/hoardings to work by pumping it into the economy somehow, which in turn will create more jobs if everyone like me acts proactively to protect their hoardings."


Who on earth deluded you into thinking this utter crap?

Posted by: krazen1211 | December 6, 2010 2:24 PM | Report abuse

what was that great Forrest Gump quote again?

Posted by: visionbrkr | December 6, 2010 2:52 PM | Report abuse

Obama is turning america into COMMUNIST state. Obamacare will KILL all the OLD PEOPLE.

Posted by: ImpeachObama11 | December 6, 2010 2:53 PM | Report abuse

TIME TO IMPEACH OBAMA, STUPID MONKEY IS KILLING JOBS IN AMERICA. ODUMBO AND SOROS CONSPIRING TO BRING ISLAM AND CONVERT AMERICA INTO SHARIA SLAVE STATE.

Posted by: ImpeachObama11 | December 6, 2010 2:55 PM | Report abuse

TIME TO IMPEACH OBAMA, STUPID MONKEY IS KILLING JOBS IN AMERICA. ODUMBO AND SOROS CONSPIRING TO BRING ISLAM AND CONVERT AMERICA INTO SHARIA SLAVE STATE.

Posted by: ImpeachObama11 | December 6, 2010 2:55 PM | Report abuse

****************************
Are you a Tea Party Member? Or just a racist cracker nor both?

Posted by: sherardg | December 6, 2010 2:57 PM | Report abuse

I will not support Obama in the 2012 election. He has proven himself to be spineless. We need a candidate with balls!

Posted by: wiz_fan | December 6, 2010 2:57 PM | Report abuse

lauren2010-
Scenario A (Bush Tax cuts for me get extended): That means I can continue hoarding my money as has happened in the last few years. Nothing changes, so I ain't changing either. End result, economy not improved.

Scenario B (Bush cuts for me don't get extended): Hmmm. Something has changed. I need to act NOW otherwise I lose money to the government next year. That means I need to create new/more business related deductions. And that means I need to create more business expenses.

--------

lauren: A) hoarding doesn't mean we're burying the money in our backyard; we invest it across a number of different strategies. B) Higher taxes have NEVER incentivized any businessperson ever to do anything (other than hiring better accountants to hide their money from the government).

but i see where you're coming from. you're scared and don't know what the answer is. welcome to the party.

Posted by: Waffle1 | December 6, 2010 2:58 PM | Report abuse

i've said this before but I'll say it again. To all the disillusioned progresives that watched the President in the run up to the campaign and heard him speaking to them about all their priorities and now are fed up and ready for a primary challenge please feel free to share with me what TRUE progressive will win the Presidency in 2012 in this center right country?

Posted by: visionbrkr | December 6, 2010 3:00 PM | Report abuse

Here's a thought: I'd rather have a job that pays 35K or more than a tax cut - but if you're going to cut taxes, cut them for people who will spend the money (and are struggling more) - the middle class. Republicans haven't shown that they care about anybody who's struggling, whether it's with unemployment benefits or jobs bills that may do something to help the economy. They certainly didn't attach strings to the bailouts that would make it mandatory to use the money given to provide loans for businesses and people who need mortgage help or personal loans.

Yes, Democrats suck as leaders, but since Republicans are leading the debate on everything, it'd be nice if their leadership led to people actually doing better, and not just them winning elections. So, you wanna make Obama a one-term president? How exactly does that repair the country or bring about jobs? Oh, that's right - you don't care, you're Republicans. You wrecked things the first time, ignored that, then blamed the next guy, and people eventually bought it while you dragged everything out as long as possible or denied a way forward legislatively.

When are we gonna start seeing more Executive Orders passed? The Congress has been broken for the past 4 years and hasn't accomplished anything good in the past 10, because of the GOP's games. In case people don't realize it, standing still in an evolving and progressing world is akin to moving backwards.

Posted by: fbutler1 | December 6, 2010 3:00 PM | Report abuse

They’re not creating jobs. They are investing in the stock market, in properties, all over the country, mountain homes, city homes. When Bush enacted these tax cuts ten years ago it was at a time when it looked like the country would be operating and we were approaching a surplus.

There’s no surplus any more.

Posted by: sherardg | December 6, 2010 3:01 PM | Report abuse

Socialist Obama and has commie democraps will stop at nothing to ruin America with his Policies. NO TAX HIKES. No more unemployment checks. They're all going to the Mexicans who are either illegal or criminals. Deport Mexicans and LIEberals back to MEXICO.

Posted by: ImpeachObama11 | December 6, 2010 3:03 PM | Report abuse

jeff1240 wrote: "Obama is not just selling himself out- he is selling out the American people. He needs to call to account these Republican junkyard dogs who are holding 98% of the country hostage to the wealthiest 2%. How about some backbone Mr. President?"
----------------------------------------------
Sorry to correct you hoss, but you may want to consider the fact that the fate of those 98%ers are directly linked to the success of those pesky and hated 2%ers.

If you want to see the economy and jobs recover in time to re-elect your Annointed One, then he has no other choice but to give up his (and supposedly your) socialistic, wealth spreading philosophy and let small AND big business work without being shackled, taxed, squeezed, and regulated to DEATH.

No, the American People are not being sold out. They are being saved. Which is what they voted for last month.

Posted by: bryanmcoleman | December 6, 2010 3:05 PM | Report abuse

The country needs to go back to it's roots. White America must rise and reclaim the government and kick out all the minorities. We must stop letting these savages enter our country, take our money, rape our women, and imposing socialist, fascist policies.

Posted by: ImpeachObama11 | December 6, 2010 3:10 PM | Report abuse

jeff1240 wrote: "Obama is not just selling himself out- he is selling out the American people. He needs to call to account these Republican junkyard dogs who are holding 98% of the country hostage to the wealthiest 2%. How about some backbone Mr. President?"
----------------------------------------------
Sorry to correct you hoss, but you may want to consider the fact that the fate of those 98%ers are directly linked to the success of those pesky and hated 2%ers.

If you want to see the economy and jobs recover in time to re-elect your Annointed One, then he has no other choice but to give up his (and supposedly your) socialistic, wealth spreading philosophy and let small AND big business work without being shackled, taxed, squeezed, and regulated to DEATH.

No, the American People are not being sold out. They are being saved. Which is what they voted for last month.

Posted by: bryanmcoleman | December 6, 2010 3:05 PM | Report abuse

**********************
Sure your right. Greed is good.

Posted by: sherardg | December 6, 2010 3:11 PM | Report abuse

So much for shared sacrifice. Apart from freezing federal salaries, what will be done about the deficit? Oh that's right, nothing, since that would have too many addiitonal negative implications for the upcoming election cycle.

No wonder people are so cynical.

Posted by: deanowade | December 6, 2010 3:11 PM | Report abuse

The President has been outfoxed by the Republicans again. Obama apologists are almost out of credibility. Defending Obama's weakness and incompetence could be the definition of "putting lipstick on a pig."

Posted by: ram_lopez | December 6, 2010 2:22 PM | Report abuse
*************************
Sadly, I agree. I am tire of defending him.

Compromise of blackmail? You make the call.

This is one Progressive who is hanging up the hat.

Posted by: sherardg | December 6, 2010 3:11 PM | Report abuse

I am so discouraged and disappointed by this president that I once fully supported. He is either totally complicit in the 30 year corporatist takeover of our nation or is incredibly weak! To his progressive (former) base, which is worse?

Posted by: seriesoftubescleaner | December 6, 2010 3:13 PM | Report abuse

Obama should refuse to compromise. Let the tax cuts expire for everyone, thus effectively raising taxes for everyone, and then blame it on the Republicans.

Posted by: foofoofoo | December 6, 2010 3:15 PM | Report abuse

This is one Progressive who is hanging up the hat.

Posted by: sherardg | December 6, 2010 3:11 PM | Report abuse

so sherardg who are YOU voting for in the 2012 Democratic Presidential primary, Kucinich? Sanders?? anybody else who doesn't have a snowball's chance in hell of winning.

Posted by: visionbrkr | December 6, 2010 3:16 PM | Report abuse


Barry the inept bungler is already a lame duck president after 22 months in office.

Barry and the Dims got slaughtered in last month's election losing 63 seats and control of the House. The reason they held control of the Senate is that only 1/3 of Senate seats are up for grabs in any election.

The biggest reason for the election losses for the Dims was their tax and spend ways.


Posted by: screwjob22 | December 6, 2010 3:16 PM | Report abuse

Ezra, you are a freak. You back Obama when he says no to tax breaks on small businesses. But then you back Obama when he says he okay with them.

Well, at least you changed your mind and came around to the right way of thinking. I like you now.

Posted by: NEWSOUTH1 | December 6, 2010 3:18 PM | Report abuse

Leftist pansies are the scum of this country. Americans must wake up and dismantle the liberal-marxist educational system and replace it with a patriotic doctrine that teaches the core foundations of our constitution and American Exceptionalism. Nonsense like evolution(a communist-fascist theory) should be thrown out for family-building Christian teachings.

Posted by: ImpeachObama11 | December 6, 2010 3:18 PM | Report abuse

No longer President Obama - he will now be refered to as Uncle Sellout Obama!!!

He lost my vote and support.

Posted by: question-guy | December 6, 2010 3:20 PM | Report abuse

I reject the notion (to borrow a phrase)that not increasing taxes is akin to deficit spending. By that logic, we're adding trillions to the debt by not having a 10% VAT, which is obviously absurd.

That being said, what bothers me is that the only thing that the ruling class can agree on is growing the debt. no coincidence here that the compromise is an increase in spending.

Posted by: batigol85 | December 6, 2010 3:25 PM | Report abuse

This would be swell if the very wealthy who will benefit the most from these tax cuts we all pay for actually stimulated the economy with them instead of hoarded them or spent them on labor off shore to take away even more American jobs. Let them expire and let Republicans take the heat and let those who pulled the (R) lever see what they voted for. This isn't a compromise. It's extortion. It's lose--lose.

Posted by: zorro2 | December 6, 2010 3:25 PM | Report abuse

Will the White House win in 2012???No!No!No! and the Democrats who vote to cave in will lose also.
Let all of the tax cuts expire. I had rather see my taxes go up than to see the wealthy get more tax cuts.
Obama is letting the republicans snowball him again. Obama needs to grow a spine and fight!!!!!

Posted by: valerie29 | December 6, 2010 3:25 PM | Report abuse

Dear Ezra,

Boy, do you know how to make a silk purse out of a sow's ear. Bad tax policy, no true stimulus policy, bad politics, but maybe it will work out in the end....

Posted by: TiminTakoma | December 6, 2010 3:26 PM | Report abuse

Answer No.


They need to take a stand now.

Think about:

from 2006 to 2010, did/are the wealthy (those making >$500K) suffering from the 2008 crash? Really, are they suffering NOW? Answer: NO.

from 2006 to 2010, did/are the middle class (those making <$500K, really!) suffering from the 2008 crash? Really, are they suffering NOW? Answer: YES.

Sure small business is hurting, but the rich aren't hurting one bit. They are actually MAKING MONEY today hand over fist-it's never changed since 1999.

Democrats have the house/senate and presidency--they need to do the right thing,, a worthwhile compromise, but looks like just looking for votes, which they will still lose in 2012 if they give in on tax cuts.


Posted by: recharged95 | December 6, 2010 3:27 PM | Report abuse

The author seems to be troubled by the notion that real world results may be more important than political considerations.

Trust me, one can lose the political war and still win the real world war.

Reality wins.

Even if the opposition is sure that history (of the instant sort) is on their side.

Posted by: GaryEMasters | December 6, 2010 3:29 PM | Report abuse

Libtards always run away from a fight. When Iran invades, who will they count on defend their sorry asses. It's obvious that Odumbo's socialist-fascist-marxist-liberal agenda has failed and the libbies are scrambling to make up excuses. Now that the people have decided not to take anymore of the obama-pelosi socialist policies, we can have a better future.

White America can return this great nation back to its christian roots and rid the country of the parasitic minorities, islamo-fascists, and the traitorous, white-guilt liberals.

Posted by: ImpeachObama11 | December 6, 2010 3:29 PM | Report abuse

I voted for Obama. If he caves on the Bush tax cuts, that will be the straw that broke the camel’s back. After not getting cap and trade, closing of Gitmo, health care with a strong public option, allowing importing of prescription drugs, getting our forces out of Afghanistan and Iraq, appealing the DADT court decision, and finally telling Government employees not to read WikiLeaks, I will never vote for him again. He has shown himself to be just another sleazy politician rather than a person of principles. I expect our political leaders to say what the mean and mean what they say.

Posted by: mtrobt | December 6, 2010 3:31 PM | Report abuse

The tax cut extension falls short in the Senate because Obama Democrats want to tax upper income Americans. The political liberals want to extend the Bush tax cuts only for Americans with incomes under $250,000. The partisan propaganda against fiscal conservatives is that Republicans support tax breaks for the wealthy.

Republicans and Americans’ fiscal conservatives can show that Americans with income above $250,000 deserve the tax cut extension as much if not more than all other Americans. Run a study of IRS records and find that small businesses represent a high proportion of taxpayers who report income between $250,000 and $750,000 a year.

Nancy Pelosi has shown her partisan Democrat line to extend tax cuts only for incomes under $250,000 so Obama can take from high incomes but not middle income taxpayers. Pelosi pushing the Democrats in the House to pass another unacceptable bill makes her look like a nut case. Even Obama has enough sense to compromise tax cuts for all American as least temporarily.

The American people reject Obama’s attempt to discriminate against wealthy Americans and sends a message that government uses discriminatory taxes as a disincentive for achieving wealth and prosperity in the U.S. economy. Do not continue to “slap the faces” of American small business owners and managers. Thank God for the Republicans.

Posted by: klausdmk | December 6, 2010 3:31 PM | Report abuse

"The tax cuts for income over $250,000 will pump about $100 billion into the economy over the next two years."

No it won't. Not even close.

Posted by: timothy2me | December 6, 2010 3:31 PM | Report abuse

Odumbo, The Clown-In-Chief is a textbook case for banning all blacks from government. They should know their place.

Posted by: ImpeachObama11 | December 6, 2010 3:32 PM | Report abuse

Let's hope Obama gets a primary challenge from Hillary. Obama is just too weak. The guy doesn't stand for anything save a rubber stamp for Republicans.

Posted by: Maddogg | December 6, 2010 3:34 PM | Report abuse

So Obama has either been taken in by the arguments that extending the tax cuts for the rich constitute a stimulus measure worth the damage done to the deficit or he believes that in 2012 the public will be. He must hope that by then the CBO study about this will have been forgotten.

"As the CBO notes, most Bush tax cut dollars go to higher-income households, and these top earners don't spend as much of their income as lower earners. In fact, of 11 potential stimulus policies the CBO recently examined, an extension of all of the Bush tax cuts ties for lowest bang for the buck. (The CBO did not examine the high-income tax cuts separately, but the logic it used suggests that extending those cuts alone would have even less value.) The government could more effectively stimulate the economy by letting the high-income tax cuts expire and using the money for aid to the states, extensions of unemployment insurance benefits and tax credits favoring job creation. Dollar for dollar, each of these measures would have about three times the impact on GDP as continuing the Bush tax cuts."
http://www.washingtonpost.com/wp-dyn/content/article/2010/07/30/AR2010073002671_pf.html

Posted by: Adam_Smith | December 6, 2010 3:35 PM | Report abuse


this is politics----
there is nothing wrong with the White House, seemingly, "bending its knee" to the majority of Congress. It only hurts for alittle while.

I am rootin' for the deal to happen. Extend the tax cuts, who cares....it's been that way for awhile. And get unemployment extensions in return.
It's a compromise but a needed one.

President can veto but it looks like he won't. House Democrats are meeting with VP Biden as we speak. They don't like the Senate bill I guess. I may have to go and read it again. But I tell ya, Senate is the one that put in "extension for a year on unemployment". The House version, called the Middle Class Tax Relief Act of 2010 that was voted down in the Senate only had 3 months. I'm sick of going through this every 3 months. One becomes a nervous wreck because they can't pay rent and have to wait for Congress to act.

Take the deal. Otherwise the unemployed will have no Xmas or be able to pay their taxes come April.

Posted by: TheBabeNemo | December 6, 2010 3:36 PM | Report abuse

So instead of garnering support from the middle class for standing up against an indefensible Republican attempt to redistribute more money to the rich Democrats will rely on a sufficiently improved economy by 2012. Genius! Can Obama's economic advisers actually believe that is plausible?

Posted by: RandyMoor | December 6, 2010 3:37 PM | Report abuse

"The White House has stopped negotiating for ideal -- or even acceptable -- tax policy and moved to negotiating stimulus policy. The tax cuts for income over $250,000 will pump about $100 billion into the economy over the next two years. It's not the most stimulative way to spend $100 billion, but it's more stimulative than not spending it, or than raising taxes."

Well, that's really standing the thing on it's head now isn't it? If you could write this today, why weren't you writiing this summer when it still mattered?

Posted by: 54465446 | December 6, 2010 3:37 PM | Report abuse

The argument that this is some kind of stimulus package is a pretty weak one -- especially if the end game is to actually foster job creation.

Krugman highlighted the unemployment impact of the tax policy at around 0.3 to a 0.6 percent reduction over the next couple years (citing CBO estimates). The extra $180 billion will be a drop in the ocean too. Maybe the deal lowers the unemployment rate to something a little north of 8 percent in two years based on a best case scenario. That's better than nothing, but in terms of the politics and the policy it's a pretty poor deal for the cost.

If the White House could negotiate a genuine stimulus that includes infrastructure spending and aid to the states as part of the deal a temporary extension might make sense in terms of policy and politics (e.g. something in the order of $700 to $800 billion with tax cuts accounting for $300 billion or so). This White House though is so weak at these kind of negotiations that it seems more like they're willing to deal the farm for peanuts and a pack of cigarettes.

If there was a viable Democratic challenger, he'd probably wake up sooner and stiffen his spine. Unfortunately, for the overwhelming majority of the population there's no legitimate challenge yet from the left, so Obama is basically negotiating these deals on the GOP's terms (e.g. the terms of the debate are over just how much money should flow to the wealthy and Senators like Mitch McConnell rather than on what it takes to generate growth across the economy).

Posted by: JPRS | December 6, 2010 3:39 PM | Report abuse

There are jobs popping up by the millions just in anticipation of the tax cuts! I'm buying my airline ticket to China today.

Posted by: Maddogg | December 6, 2010 3:40 PM | Report abuse

WHY CAN'T YOU LIBTARDS SEE THAT YOU'RE ALL NOTHING BUT PARASITES. Your days of taking the white man's money is over and your failure of a president is done for. The TIME has come for the white man to stand up for his rights, and expel all the undesirables from the country with any means necessary.

Posted by: ImpeachObama11 | December 6, 2010 3:40 PM | Report abuse

Better question: Do true Democrats care anymore whether Obama wins in 2012?

Posted by: jimsteinberg1 | December 6, 2010 3:43 PM | Report abuse

If the tax cuts are not permanent and democrats insist on unemployment extension, then republicans need to insist on federal right to work law which would allow federal employees to not join union and pay dues if that is their choice.

Posted by: ibralph | December 6, 2010 3:44 PM | Report abuse

This is optimistic on numerous counts.
First, that the extension of tax cuts will pump $100 billion into the economy. Where does that figure come from? Klein fails to say. The wealthy also buy a disproportionate amount of luxury items, many of which don't do much for American bottom lines. The rich will now take their savings and spend it on a ski trip to Switzerland. Total US income effect: $0.
Second, this is not your average news cycle defeat. Obama came into office riding a wave of support that was bolstered by the disgust over W's unabashed favoritism of the rich and the links people made between that and the economic meltdown. The roots of the meltdown may be deeper and more complicated, but it's fair to say W had little interest in seeing to it that the working and middle classes saw even close an even share in income growth under his watch. We believed Obama was different. Agreeing under Republican pressure to extend tax cuts for the wealthy is an abandonment of core principles as well as a repudiation of his apparently undeserved reputation as someone who didn't see the need to coddle the wealthy. This is not the kind of thing many of his supporters are likely to forget by 2012.
Third, anyone who tries to predict the political arena two years out is insane.

Posted by: mw-bkly | December 6, 2010 3:47 PM | Report abuse

Better question: Do true Democrats care whether Obama wins the White House in 2012?

Posted by: jimsteinberg1 | December 6, 2010 3:48 PM | Report abuse


the rich can buy more cars for their mistresses, more $1000 Gucci purses, and $5,000 luggage sets for their kids. Money will be spent if the rich get the continued tax cuts. Most in commodities.
Maybe they will all buy the new electric cars. But the Chanel suits, botox, 150 dollar perfume, high priced food---- will all be bought. Don't forget the wives of the mega rich. They spend it like water. Ask Paris Hilton.
So the money goes back into the economy.

While the common man, who gets their extension of unemployment, gives back to economy by buying their necessities, maybe in lower quantities and cheaper (living on those Ramon noodles)...paying their house payment, maybe car payment if they haven't given it up, they can pay electricity. All the stuff that rich folk take for granted.

Either way, it helps the economy. If this deal goes through, the kids of the unemployed may get a gift for Xmas or may be able to get a tree for the house. What a concept!!

MAKE THE DEAL !!!

Posted by: TheBabeNemo | December 6, 2010 3:49 PM | Report abuse


The question: "Can the White House win in 2012 by losing on the Bush tax cuts now?"

Was the Bush 1 able to win after he turned his back on "Read my lips... No new taxes."? No. Bush lost his base and lost to Billy.

What's worse? The Republican are going to spend the next two years punching Obama in the gut with one Obama Care horror story after another.

I figure by the time 2012 arrives most of the liberal base and young voters will choose to stay home.

It's going to be brutal.

Posted by: L1ncon | December 6, 2010 3:49 PM | Report abuse

4 million people will go without a paycheck this month. Are you kidding me Ezra Klein and all the so called "bleeding heart" liberals who say Obama is caving. All of you HAVE JOBS. My father was unemployed; without unemployment insurance, life is bleak. Obama is doing the hard thing, protecting the poor out there.


Posted by: AB68 | December 6, 2010 3:49 PM | Report abuse

I'm a lifetime Democrat and the White House, if they capitulate on this tax cut issue, will not secure my vote in 2012, they will LOSE my vote in 2012.

If they want to delude themselves by rationalizing their weakness and incompetence by pretending it's actually a brilliant political strategy, let them.

Of course we've been hearing that idiotic excuse for their gutlessness for the past two years and, judging from the 2010 election results, it didn't work out that way, now did it?.

Obama needs to admit that he and his advisors are not up to the job and step aside to let a real leader, a person with spine and character instead of a wimpy appeaser, accept the Democratic nomination for president in 2012.

Posted by: toc59 | December 6, 2010 3:53 PM | Report abuse

ImpeachObama11

Wicked trolling dude.

Posted by: daweeni | December 6, 2010 3:53 PM | Report abuse

Terribly simplistic article.

The main issue is how disillusioned will Democrats become now that they see Obama abadoning his ideals and letting McConnell lead him around like a pet.

A true stimulus plan gives money to people who will spend it (middle class and lower classes), not just invest it in real estate or the stock market (wealthy class).

Too bad Obama is unwi9lling or unable to explain to the American people that they way we have gotten into this stagnating economy is my letting the rich hoard wealth that should be circulating in the economy.

Posted by: JamesCaroll | December 6, 2010 3:54 PM | Report abuse

Obama was done, like...YESTERDAY...well at least with my support, that is!

Posted by: danders5000 | December 6, 2010 3:55 PM | Report abuse

LIBBIES always blame the rich because they can't work a damn. They need to suck of the teets of the socialist Obama administration. You all make me sick.

If you're on the streets starving to death, it's your fault and you probably deserve it by being a lazy, complaining liberal. The wealthy earned their money with their hard work. It's not right that the poor--with their small liberal-marxist minds that can't comprehend the workings of a free-market society--take money from the rich. It's good that they wither and die away, leaving us, the superior white men to prosper with our industrial determination.

Posted by: ImpeachObama11 | December 6, 2010 3:56 PM | Report abuse

I'm too lazy to do the math to truly argue with your thesis. BUT ... if tax cuts didn't do any good a few years ago, why would extending them help? I feel like we're in this awful cycle of risking now for later ... The truth is, this is life as we know it now. The jobs we once had are gone, unemployment is going to remain high for a while. This challenge requires new solutions, not the same ol' cutting taxes, extending unemployment nonsense ... So much for change, brainiacs.

Posted by: callmecarmen | December 6, 2010 3:56 PM | Report abuse

What stimulus? People with taxable income of > $250K aren't going to spend that incremental tax cut, they'll bank it. Duh. How can you not know that trickle-down economics has been thoroughly discredited by the last 30 years of evidence?

By extending tax cuts for the rich and proposing cuts in middle- & lower-class benefits (Soc. Sec., Medicare) while we have a deficit, we are borrowing from China to give money to the rich, and paying that money back by cutting Soc. Security & Medicare. THAT's what's happening.

Posted by: clampson | December 6, 2010 3:57 PM | Report abuse

Better question: Do true Democrats care whether Obama wins re-election in 2012?

Posted by: jimsteinberg1 | December 6, 2010 3:57 PM | Report abuse

I think the White House can win in 2012. It's a long way off in truth.
And the President has done some good things.

All he has to do is start pulling the troops out of the wars, like he has said he will....(the deadline given was what? I forgot) ----- he will get alot of support and admiration for that.

If the White House bends its knee now, so what. Everyone should go to whitehouse.gov and read how much good legislation has already come down the pike. The press never reports on it. We have had Small Business Acts extended constantly through 2 years now. To give them tax breaks and incentives.
See the good stuff for a change, not the bad.
Besides, who the heck is the President going to up against in 2012???? No one of importance. I betcha ten bucks McCain tries to run again. And you know we are tired of that one.


Posted by: TheBabeNemo | December 6, 2010 3:57 PM | Report abuse

Here's the deal: The Dems have a bill to give tax cuts to most Americans. GOP won't support it. It has failed. Let the tax cuts expire, and tell the GOP and voters that middle-class tax cuts available whenever the GOP votes in favor of them. If we all end up paying higher taxes just consider it's the bill that has come due from eight years of George W. Bush and the GOP. I think people will figure it out. After all, aren't all the big conservatives worried about the deficit? They ought to be happy.

Posted by: dparks2 | December 6, 2010 4:00 PM | Report abuse

A recent paper by Christina Romer in the October issue of American Economic Review titled "The Macroeconomic Effects of Tax Increases" concludes that a tax increase "costs" about three times the amount raised in lost GDP growth, and that the lost growth is primarily the result of lost investment. This finding should be sufficient to convince most people that a tax increase now on the segment of the population that invests the largest percentage of their income is probably a bad idea.

Posted by: unwashed_brain | December 6, 2010 4:01 PM | Report abuse

it's pathetic to watch ezra become like gregg- cya for obama!

Posted by: newagent99 | December 6, 2010 4:01 PM | Report abuse

oh, the rhetoric of the children
"can't leave the children with a huge deficit".....do it for the children.

Heck, they never cared before what they put on the heads of the children.

Why even throw that point or argument out. It's futile because the past speaks for itself.

Now if the children could get out of their student loans somehow, then so be it, do something about that. I mean heck, I never walked out of college with $30,000 to 60,000 debt. I paid for it out of my own earned money.

So this bull about "don't leave the deficit to our children" is crapola.

Posted by: TheBabeNemo | December 6, 2010 4:01 PM | Report abuse

Looks like Ezra has been reading my website ;-) I wrote about this earlier today and said essentially the same thing. My insight would be that this is essentially the Republican's stimulus package. If it works in creating jobs, Obama gets the credit. If it doesn't the Democrats need to be able to flip the narrative to this being the Republican stimulus bill and it not creating jobs.

http://www.doubledutchpolitics.com/2010/12/extending-bush-tax-cuts-for-2-years-more-costly-than-the-stimulus-bill/

Posted by: RyanC1384 | December 6, 2010 4:01 PM | Report abuse

Better question: Do true Democrats care whether Obama wins the White House in 2012?

Posted by: jimsteinberg
//////////////////////////////

At a more fundamental level, will Obama even be the nominee in 2012?

This may seem like a given, but it's one of those "it depends" type questions. A serious challenger would probably do a lot of good for Obama at a policy level right now. Maybe he'd just dig his heels in even deeper, but it might encourage a more constructive recalibration. Based on the impact of the mid-terms though, odds are probably not to that strong that he'll make any kind of favorable recalibration. He can't even seem to muster the political will to fight for a policy that an overwhelming majority of the population support (or oppose one that a majority oppose).

Posted by: JPRS | December 6, 2010 4:03 PM | Report abuse

I can't stand seeing or hearing him. It's like...and by the by...Where were all this hoop-la when Dick Cheney said "Who cares about a deficit?" and went on to prove it by doubling the baloon.

Obama is an arrogant clueless President. He's on stage looking to the left saying the economy is turning around...Then he turns to the right and say...We will add another 70billion dollars to the debt in the next two years by....yealing to not letting the Bush tax-cuts expire

WHAT A WASTED VOTE...

ALL DEMOCRATS IN OFFICE

BEFORE YOU SURRENDER TO THE SPINELESS WHITE HOUSE...REMEMBER...A LOT OF YOU WILL FACE A RE-ELECTION IN 2012 AS WELL!!!!!!!!!!!!!!!!

Posted by: danders5000 | December 6, 2010 4:05 PM | Report abuse

Here's the deal: The Dems have a bill to give tax cuts to most Americans. GOP won't support it. It has failed. Let the tax cuts expire, and tell the GOP and voters that middle-class tax cuts available whenever the GOP votes in favor of them. If we all end up paying higher taxes just consider it's the bill that has come due from eight years of George W. Bush and the GOP. I think people will figure it out. After all, aren't all the big conservatives worried about the deficit? They ought to be happy.

Posted by: dparks2 | December 6, 2010 4:00 PM | Report abuse

--------------------------------------
LIBBIES are SO easy to laugh at. From your nonsensical ramblings you must be a marxist-socialist-liberal-fascist. GET A JOB BUDDY. STOP MAKING US REAL AMERICANS BUST OUR ASS JUST SO YOU CAN SIT IN YOUR HOUSE AND POST DISINGENUOUS ARGUMENTS OVER THE INTERNET. YOU'RE THE PROBLEM.

Posted by: ImpeachObama11 | December 6, 2010 4:06 PM | Report abuse

The Obama Plan is the Destruction of America. The Actions show it. His words show it. The results are showing it. The People see it and have REJECTED OBAMA AND HIS POLICY. The People don't want a compromise. The People want the Destructive Policy of this Demonic Obama Administration STOPPED. The traits of Obama and his Administration are of a Demonic Nature.

Posted by: makom | December 6, 2010 4:07 PM | Report abuse

OBAMA AND HIS POLICIES ARE KILLING AMERICA. WE REAL AMERICANS WILL PREVAIL OVER THIS PORCH MONKEY SOCIALIST PRESIDENT AND RESTORE THE TRUE CAPITALIST, FREE-MARKET, FREEDOM-LOVING, CHRISTIAN, WHITE AMERICA.

Posted by: ImpeachObama11 | December 6, 2010 4:10 PM | Report abuse

A recent paper by Christina Romer in the October issue of American Economic Review titled "The Macroeconomic Effects of Tax Increases" concludes that a tax increase "costs" about three times the amount raised in lost GDP growth, and that the lost growth is primarily the result of lost investment. This finding should be sufficient to convince most people that a tax increase now on the segment of the population that invests the largest percentage of their income is probably a bad idea.

Posted by: unwashed_brain

////////////////////////

What did Christina Romer actually say?

"The way you might find a bipartisan agreement is to explain that those tax cuts from the very highest income earners don't do much at all in terms of short-run job creation," Romer says. But "they are potentially a disaster for our long-run budget deficit."

The CBO agrees as well.

If the end game is job creation in Brazil or China, perhaps those tax cuts might provide some near term benefit for those economies. If the end game is job creation in the U.S. you can't get there without addressing the consumer demand side of the equation.

Investors aren't in the business of charity and they won't fill the gap in consumer demand until ordinary consumers re-enter the market in full. Ordinary consumers won't re-enter the market until you have a reduction in unemployment. A reduction in unemployment won't occur in the near-term without more federal spending to off-set the drop in consumer demand and the lost private sector wealth that took place as a result of the 2008 financial crisis.

Posted by: JPRS | December 6, 2010 4:13 PM | Report abuse

Obama win?

Win what? He is throwing away his supporters right and left.

Mr. Obama, sir, don't you remember what happened in 2009 when you tried "compromising" with the regressive anarchists?

They still didn't vote for your bills. They won't vote for your bills in 2010 or 2011 or 2012.

Do you know why? Your last name is not Incorporated, or Inc or Conglomerate.

Both parties, especially the GOP, has been selling out the American workers since at least the 1980 election. That was when we elected a man who wanted to turn control of our society over to the robber barons of Wall Street. Guess what, it happened!

Posted by: BigTrees | December 6, 2010 4:20 PM | Report abuse

Losing the tax cut fight is the least of Obama's worries! It's the unemployment benefit extension he'd better worry about. There are going to be more than 8 million really ticked off unemployed Americans by the end of March and they aren't going to just curl up and die!

Posted by: beatle-maniac1 | December 6, 2010 4:23 PM | Report abuse

The only "win" for the president is if unemployment goes down.

If unemployment doesn't go down, nothing else matters.

I hope stimulus helps the economy more to bring down unemployment numbers.

I think your memory of the Bush tax cuts' original passage is a bit off. A stronger economy won't make ending tax breaks to the rich easier.

The Republicans will simply argue that the economy only improved because of the tax cut extension. "Do you want us to go back into the abyss?!" They'll scream, with froth flying from the mouth.

Republican policy recommendations: Strong economy, budget surplus: Cut taxes, reduce regulations.

Weak economy, budget deficit: Cut taxes, reduce regulations.

Strong economy, budget deficit: Cut taxes, reduce regulations.

Weak economy, budget surplus: Cut taxes, reduce regulations.

Notice any pattern here?

Posted by: will12 | December 6, 2010 4:24 PM | Report abuse

A well-argued case. It's plausible Obama is calulating that way, that this will be stimulus, and good times two years from now will re-elect him.

We'll see. I'm one of those who is now giving up on him. I had so much hope, and he's disappointed me one too many times with this tax fight. We all need to factor in the disappoint factor for Dems now, esp. considering how fired-up Republicans are by contrast. Obama better hope they nom. Palin in 2012, that will send a lot of votes his way.

Posted by: michaelmelius | December 6, 2010 4:27 PM | Report abuse

ImpeachObama11,

No doubt if Christ re-appeared you'd be first in line to re-crucify him all over again for giving away loaves and fishes; for kicking money-lenders out of the temple (a clear restraint on trade); for speaking up for the poor, etc.

The Sermon on the Mount pretty much embodies everything that conservatives hate. Social conservatives are the worst in this regard. They claim to be Christians on Sundays but six days out of the week they show their fealty by worshiping Mammon.

Posted by: JPRS | December 6, 2010 4:27 PM | Report abuse

'A recent paper by Christina Romer...'

Isn't she one of the ex Odumbo economic minds? You know, the architects of his jobless recovery.

What a hoot listening to all this class envy whining. I'm not rich be any means, but it's so much fun to listen to all the mindless liberal babble.

Posted by: LarryG62 | December 6, 2010 4:30 PM | Report abuse

I am beyond political analysis, war is war and if President Obama is unable to stand up against the vile, hated republicans, there is no hope for the country. He has become our own Neville Chamberlain, surrendering to the American Nazi Party.

Posted by: kaycwagner | December 6, 2010 4:35 PM | Report abuse

"As it is, the White House defined an extension of the tax cuts for the rich as a loss for them -- and now they're going to extend those tax cuts, and lose."

Could it be they defined the issue as tax cuts for wealthy in order to give republicans a way to allow more stimulus? They haven't mentioned any of this and it seems like they're keeping it under everyone's radar.

Posted by: LauraNo | December 6, 2010 4:36 PM | Report abuse

Ezra,
Your notion of a "two-year stimulus package that approaches $300 billion" represents a fundamental error. "Stimulus" connotes a boost for the economy. That means what you define as "stimulus" would have to be tax rates LOWER than what they are now as a result of the Bush-era tax rates. Similarly, the tax breaks created by the Obama stimulus law enacted in 2009 would have to be GREATER than they are now to qualify as stimulus. Look at it this way: the economy is currently perking along (sarcasm intended) at the Bush-era tax rates and with the Obama-era tax breaks you define as future stimulus already in place.

Properly understood, the administration is seeking to prevent the anti-stimulus, or pro-cyclical, effect of ending the Bush-era tax rates and the Obama-era tax breaks – of raising taxes and ending tax breaks.

If the Obama negotiating position is successful, this would not be stimulating the current economy. It would be preventing depression of the economy. Metaphorically, it would not mean pressing the accelerator but not pressing the brake either.

Posted by: fredbrack | December 6, 2010 4:39 PM | Report abuse

unwashed_brain,

There's is more to the report.

"Finally, we
find suggestive evidence that tax increases to reduce an inherited budget deficit do not have the large
output costs associated with other exogenous tax increases. (41)"

http://www.econ.berkeley.edu/~cromer/RomerDraft307.pdf

However, she adds that

"This is consistent with the idea that deficitdriven
tax increases may have important expansionary effects through expectations and long-term interest
rates, or through confidence."

Tax hikes don't cause much damage if there is a large existing deficit, though she believes that part of the reason for that is that a smaller budget deficit does things like reduce long term interest rates. Then again, long term rates are already very low, as Krugman reminds us daily.

Tax cuts/hikes don't add/remove money from the economy, but they shift it. The near-term GDP decline, given a modest shift in marginal rates, will probably be associated with tempoary spending pattern disruptions.

Posted by: justin84 | December 6, 2010 4:44 PM | Report abuse

GOP or Tea Party is not Nazi; but I agree with the sentiment.

What all this means Ezra is trying to make 'lemonade' out of lemon.

Really hard to believe this White House. He is a President without cloths....

Posted by: umesh409 | December 6, 2010 4:45 PM | Report abuse

The deficit when the Dems took over congress (2006) was 248 billion, unemployment was 4.6%. Four years with the Dems in charge of congress? The 2010 the deficit is 1.3 trillion, unemployment is 9.7%. The deficit is not a Bush tax cut problem, but a Democrat congress problem.

Posted by: cbk1 | December 6, 2010 4:50 PM | Report abuse

yeah, the propaganda is really good, but its still getting harder and harder to fool the middle classes because, well, we won't get fooled again, as the song says. This has been going on for, what, thirty years now? The dems and the repubs are just playing politics, but they really agree on the only important thing, which is protecting the rich. And that has become increasingly obvious to those with eyes to see and ears to hear. You can't fool all the people all the time, and you are going to have to get a new schtick or you arent going to be able to fool even a bare majority...but when you own both parties I guess it doesn't matter. Its heads they win tails we lose.

Posted by: underhill | December 6, 2010 4:50 PM | Report abuse

Ezra, I liked it better here when it was just policy nerds doing fact based argument back and forth with no one listening.

Too many crazies on both sides have been dumped on us like a busload of tourists at a McDonald's in DC.

Posted by: 54465446 | December 6, 2010 4:51 PM | Report abuse

For all those who posted for and against extending the current tax rates for all taxpayers, no one commented on the historic spending of the past two years. If the Democrats had kept the power in the House, you know that we would have kept going deeper and deeper into debt. I have to agree with the people who say - We do not have a revenue problem - We have a spending problem.

Posted by: sales7 | December 6, 2010 4:51 PM | Report abuse

Ah, so WashPo still thinks the Bush tax cuts are good for the economy. My goodness gracious, just HOW will I ever spend my extra $28 per month? Ezra, isn't it time for the Koch brothers' 4:00 shoe shining? Run along, dear.

Posted by: Ladyrantsalot | December 6, 2010 4:51 PM | Report abuse

LarryG62,

Actually the so-called jobless recovery began in 2001. For the first time since 1933 a president entered office and after two-terms there was no-net job creation. Additionally you had a net decline in the median income of $2K over 8 years (while incomes in the top-tax bracket sky-rocketed).

Unlike the previous president this president's inheritance wasn't a near elimination of the national debt within 10 years, relatively low levels of consumer debt, and an increase in the median wage of $6K. Instead he inherited a heavily overleverage private sector, an economy that was bleeding 700K jobs a month, and a federal debt burden in excess of $10 trillion.

The short-version, it's sad as hell seeing a generation of Cons holding up crooks and robbers as role models while they simultaneously complete the theft of the national wealth from several generations of Americans (all done in a short 30 year period).

On second thought it's not surprising when a person considers that the de-facto party leader of the GOP since the 1990s is a drug-addicted, draft-dodging, college drop out with a popular radio show.

Posted by: JPRS | December 6, 2010 4:54 PM | Report abuse

Republicans, Of the Rich, By the Rich and For the RICH, voted in lockstep against the tax cut for everyone making less than ONE MILLION DOLLARS a year. The poor millionaires can't tolerate a 4% tax increase on the 2nd million they make in one year.

NO ONE DARE talk about Small Business owners. No Small Business owners makes over a million dollars a year.

Republicans speak Debt Reduction out of one side of their mouths. Then vote to add a trillion dollars to the Debt, to benefit the 0.1% RICHEST Americans.

No one can defend the Republicans, Of the RICH, By the RICH and For the RICH!

100% of Republicans voted against the American people. Vote 100% of Republicans out of office.

Posted by: chucky-el | December 6, 2010 4:55 PM | Report abuse

SURELY, OBAMA, GEITHNER AND CONRAD NEED THEIR TAX CUTS
WHAT IS THE POINT OF A DEAL? Republicans really don't want just a two year extension (which by the way is still dangerous for the economy) but a permanent tax cut for the rich. They might settle for now for what they can get in the hope of making the matter their key campaign issue again in 2012. And they certainly believe that after the 2012 elections a Republican President will be seating at the White House to make their tax break for the rich dream permanent. Obama, and his handlers at the White House are not just bad tacticians but hopeless cowards who lack the vision, principle and strength to effectively confront and win over their Republican nemesis. This President has become a joke. Pelosi must not give in; the last card in this end-game is in her hands! Progressives still have the card to trump Obama and his Republican allies. Obama and Geithner and Conrad and a few other rich Democrats pretend they want the best for country on this, but it seems they are not coming into this negotiation with a clean hand since they will definitely benefit big time if the Bush Tax Cut for the Rich is extended. Therefore, they are not really prepared to fight for its repeal. They are only too eager to tell us that they tried; did they really? The only way to stop a bully is to call his bluff. Obama has never done this; instead he gives away the store before any engagement with his opponents. Obama and Conrad are telling us that we have to deal with reality—the world as it is. No, reality is not changeless. Indeed effective and renown leaders help us create new realities. Gingrich and Clinton presented two different realities to Americans during their showdown that led to shutting down the government. Clinton’s reality prevailed.
Dr. Sam

Posted by: drsam8 | December 6, 2010 4:57 PM | Report abuse

Obama is not even making a good one-termer. Hillary needs to primary him in 2012.

Posted by: Maddogg | December 6, 2010 5:01 PM | Report abuse

pelosi is from california and reid is from nevada. if you think there is any chance either will think twice before pulling the lever to give away trillions to the wealthy in exchange for a few weeks of unemployment benefit extensions, you are confused.

Posted by: eggnogfool | December 6, 2010 5:01 PM | Report abuse

I am beyond political analysis, war is war and if President Obama is unable to stand up against the vile, hated republicans, there is no hope for the country. He has become our own Neville Chamberlain, surrendering to the American Nazi Party.
-------------
He didn't surrender, he believes as Bush does, tax rates should be low for all Americans. He believes Guimo should still be open, Bush's Iraq policy was correct. Basically, Basically if Bush were president today, not much would be different. He just say's differently during election time to get more votes, in practice he acts on what he thinks is best. He is a typical politician.

Posted by: cbk1 | December 6, 2010 5:02 PM | Report abuse

Barring a miracle (i.e., that the GOP / T Party liars are stupid enough to nominate Palin) ,

You can pretty much stick a fork in this one.

Nobody likes a wimpy wuss.

Posted by: StevenK3 | December 6, 2010 5:10 PM | Report abuse

I suppose we should be used to Mr. Klein's deceptions. The facts are that there are tax rates that were enacted in 2001 & 2003. Letting them expire is a tax increase and the responsible entity is factually responsible for a tax increase. Plain and simple. Mr. Klein continues to have regular problems with facts. He seems to need a remedial course concentrated on professional ethics and not prevaricating.

Posted by: justthefacts14 | December 6, 2010 5:11 PM | Report abuse

First of all extending tax cuts for the wealthy for more than two or three years and getting extended UI benefits for one year is a poor strategy. The last thing this president shld want is a huge number of unemployed with their benefits running out during an election year. At the very least he shld get benefits extended pass the 2012 election.

Posted by: rbprtman23 | December 6, 2010 5:15 PM | Report abuse

dparks2 wrote:
"The Dems have a bill to give tax cuts to MOST Americans."

----
I suggest a clarification.
MOST is incorrect.
ALL Americans can qualify on adjusted gross income up to $250K.

Those who make over $250K are capped to first $250K of income.

Posted by: boscobobb | December 6, 2010 5:16 PM | Report abuse

cbk1,

If Bush was president today we wouldn't have the CARD Act or the Lilly Ledbetter Act. We wouldn't have to social liberals on the Supreme Court. We probably wouldn't have a BP compensation fund for victims of its negligence on the Gulf Coast. We wouldn't have even the fairly modest investments in Green Tech. The structured bankruptcy of GM and Chrysler likely would have paid out debt for the company at 100 cents on the dollar.

One area where things might be different in a more positive direction: If George W. was president the GOP in Congress might very well have pushed to pass a $2 trillion stimulus in 2009 in order to create jobs. There probably wouldn't have been any oversight of the funds, so at least one-quarter of the funds would have disappeared. But you have to know that there would have been enough juice in the measure to ensure that the economy would be humming in 2010 and 2012.

If Rove was around too, you might have some political prosecutions running (on the negative side of the balance sheet).

Conversely, if Obama had been president on 9-11 it's hard to imagine that he'd structure the Gitmo approach the way that Bush did.

I think Obama has done a pretty poor job with respect to domestic economic policy, but comparing him to George W. really understates just how incredibly reckless and inept that administration was (combined with a strong assist by the entire GOP in Congress -- many of whom are STILL in Congress). People can say a lot of things about Obama, but even the health care plan had a financing structure in place to ensure that it would be either deficit neutral or a deficit reducer. The same can't be said of ANY major George W. initiative whether it was Medicare Part D, the wars, or tax cuts.

Posted by: JPRS | December 6, 2010 5:17 PM | Report abuse

The chances for 2012 are severely diminshed. The Democrats running the White House show no spine. They have many valid arguments to NOT caving in to the Republican demands, which are only serving the wealthiest 1 or 2% but no one else. Public opinion is broadly in favor to let the tax cuts expire. Remember it was already a bad move in 2001 and 2003, and it still is. The fairy tale of economic stimulus and job growth require the wealth to become even more so needs to be exposed as such. A great CON! That never worked, we have NOT seen any positive effect, and wll not see that, but will only see a further increase in the appalling wealth inequality that is a TRUE TIME BOMB under this society. The Republicans can easily be painted as traitors for the common good and future of this country. But alas, Democrats have no balls or backbone and are unable to formulate a compelling narrative despite many other can.

Posted by: RonGey | December 6, 2010 5:27 PM | Report abuse

justthefacts14,

Of course, the people who put the original job-destroying, budget-busting tax cuts into effect did not make them a permanent part of the tax code (in part because they were playing games with the federal budget and couldn't muster the votes for a permanent modification).

It's worth noting that the middle class portion of the tax bill extension passed the House and is now tied up in the Senate (once again) thanks to GOP obstruction.

The GOP is willing to increase taxes on the rest of the country if the cuts for millionaires aren't part of the deal; the Dems, at least in the House, have said that they are happy to keep the current rates permanent for the rest of the country provided that those earning 250K or more a year see an increase of 4 percent on income that's over $250K.

Posted by: JPRS | December 6, 2010 5:28 PM | Report abuse

I'm tired of the short-term political gamesmanship of our two-year election cycles. Part of Obama's winning campaign was built around not extending the Bush tax cuts for those making over $250K. If the thinking in the White House is that Obama will be in a better position to get re-elected in 2012 by thwarting his campaign promises of 2007, then I've lost all hope. Who will care if Obama gets re-elected in 2012 if he's so willing to sell out his promises (and those who voting for him) now?

Posted by: behemoth98 | December 6, 2010 5:28 PM | Report abuse

IF you must capitulate, extend tax cuts for only Six months (or the same length of time as unemployment benefits are extended). Six months to see if there is any good faith from the GOP on nuclear inspections and other important issues. Extending tax cuts beyond Six months only sets yourself up for failure in 2012 (as well as betrays the trust of the middle class and poor).

The wars in Iraq and Afghanistan cost roughly $108 Billion/year not counting Billions more for the future costs of caring for America’s wounded veterans. The running total of the wars in Iraq and Afghanistan since 2001; One Trillion One Hundred Billion is enough for 200 Nuclear reactors, Thousands of Wind and Solar Farms and Millions of American Jobs:

http://www.costofwar.com/

2010 Total USA Defense Spending = $830 Billion ($722 Billion plus the $108 Billion for wars in Afghanistan and Iraq = 34.58% of $2.4 Trillion in revenues). Defense spending rises to $895 Billion for 2011: 34.8% of $2.57 Trillion in Revenues, all of which is Borrowed Deficit Spending.

http://www.washingtonpost.com/wp-srv/special/politics/budget-2010/

Troops do the dying, while Billionaires and their lackeys do the whining. End all the Bush era tax cuts and raises taxes to pay our bills. Not possible? Really? Millionaires and Billionaires are paying the lowest tax rates since the 1950s and pay $0.00 in estate taxes in 2010.

Posted by: Airborne82 | December 6, 2010 5:29 PM | Report abuse

MAKE THE DEAL !

VOTE BY FRIDAY AT THE VERY LEAST !!!

Posted by: TheBabeNemo | December 6, 2010 5:30 PM | Report abuse

I REALLY hate to say this, because I respect and admire President Obama's fine mind, intelligence and eloquence as a writer and a speaker.

Truly great leaders are FIGHTERS, Mr. President.

We do not now, nor have we EVER lived in a fairy-tale, abstract world of 'ideas'.

We live in a world of real, mean, nasty, flesh-and-blood human beings, most of whom are terrified of change and will follow anyone who seems STRONG and DECISIVE.

That ain't you.

Posted by: StevenK3 | December 6, 2010 5:37 PM | Report abuse

This is a wonderful idea. Just get all the troops and bases out of Iraq and Afghanistan leaving no non-combatants, special forces, cia contractors by the end of 22011 and start no more wars or deployments and it should be done deal. Otherwise it is hogwash and the pig is left without lipstick at all...

Posted by: Wildthing1 | December 6, 2010 5:38 PM | Report abuse

Mr. Klein,

You are of course assuming that Obama is not going to full support tax cuts for all. I say he is and is using the gop for cover. Looking at Obama's record shows he is much more a Reagan republican than anything else. He wants to extend the tax cuts and then tell democratic voters in 2012 that it could be worse. He will tell us all about how if you do not support him then palin will become president. So let us all stop pretending the president is really a democrat and the picture will become much clearer.

Posted by: parent4 | December 6, 2010 5:40 PM | Report abuse

Too clever by half, Ezra. Sometimes we constituents need to see our President and congressional representatives simply do the right thing. The President's strategy fits a pattern of cave-ins rather more closely than it does the implementation of a brilliantly subversive way of accomplishing the people's objectives. With this further double drain on the Treasury won't Republicans have to pass even more draconian cuts in services and benefits to show some adherence to their campaign promise to cut the deficit? Perhaps you are right and the President will come out ahead with this strategy, risky as it is; but the people (all except the wealthiest) will lose.

Posted by: DeGeorge | December 6, 2010 5:43 PM | Report abuse

JPRS

So lets just make everyone pay their "fair share" including the close to 50% of the wage earners who pay no income tax and those who, how dare they, get a tax credit without any taxable income. And to remind you of the facts, your allegation that "...the original job-destroying, budget-busting.." is completely unsubstantiated by any verifiable facts. Shilling for the tax and spend democrats yes, but a prevarication with no doubt. I seem to recall a couple of trillion dollars called something like "...recovery..." that went where? Yes no where other than to the national debt balance so please save your unsubstantiated claims for your fellow ostriches.

Posted by: justthefacts14 | December 6, 2010 5:43 PM | Report abuse

Too clever by half, Ezra. Sometimes we constituents need to see our President and congressional representatives simply do the right thing. The President's strategy fits a pattern of cave-ins rather more closely than it does the implementation of a brilliantly subversive way of accomplishing the people's objectives. With this further double drain on the Treasury won't Republicans have to pass even more draconian cuts in services and benefits to show some adherence to their campaign promise to cut the deficit? Perhaps you are right and the President will come out ahead with this strategy, risky as it is; but the people (all except the wealthiest) will lose.

Posted by: DeGeorge | December 6, 2010 5:44 PM | Report abuse

Rummaging through wikileaks leaks, I found China's secret plan for world domination:


Just smile and wave as America destroys itself from within.


Posted by: StevenK3 | December 6, 2010 5:47 PM | Report abuse

Mr. Klein,
Please don't equate tax credits with tax cuts. You're smarter than that.

Posted by: cprferry | December 6, 2010 5:48 PM | Report abuse

Us does not have money to pay its payroll and Obama is considering a extension of tax cuts to the wealthy ( the making record profits)? If he does so, he need to resign otherwise we have to ask for one.

Posted by: rappahanock | December 6, 2010 5:52 PM | Report abuse

Ezra, do you seriously believe extending the tax cuts for the rich will create jobs, even though they haven't for the last 10 years? If there were to be compromise, it should been increasing the cut-off from $250,000 to $500,000 or perhaps even $1,000,000. Millionaires will nto be pumping the tax breaks back into the economy, they will continue to save it in their off-shore investment accounts, which will have zero benefit to our economy. I see this as the final betrayal by Obama to his base. Consider this his "jumping the shark" act which cost him any chance for re-election for 2012. At this point, a primary challenger is a distict possibility.

Posted by: alexnyc8 | December 6, 2010 5:56 PM | Report abuse

George W. Bush’s job approval rating as president has spiked to 47 percent, according to a Gallup poll released Monday.

That’s 1 point higher than President Barack Obama’s job approval rating in a poll taken the same week.

LOL !!!


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

The fools in Washington still think people need tax cuts and credits. Most people need well-paying jobs.

The government is broken. We need another election before January for all positions.

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

Favorite Quote:

"The wealthy will take care of the poor" -Herbert Hoover

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

Palin for Prez in 2012

Posted by: Maddogg | December 6, 2010 6:18 PM | Report abuse

So once again Democrats are sold out on the altar of expediency. After campaigning on pledges not to continue tax breaks for wealthy millionaires, Democrats are caving even before the new Congress begins on this key issue. It doesn't matter that billionaires like Warren Buffett want the tax increase, and have asked for it. No, Democrats are going to deny increasing taxes on millionaires who want it, just so they can have another issue to cave in on. Wow. what has happened to this party. It now stands for nothing, and is signaling to the Republicans that it will cave at the earliest possible moment on its key principles. Social Security: to hell with the edlerly. Medicare: tax the elderly for their benefits. Absolutely incredible.

Posted by: edwardallen54 | December 6, 2010 6:21 PM | Report abuse

Historys has repeatedly shown us that politicians maybe arbiters of their choices, but not outcomes. They seem to always give full focus to the ramifications of what can be conveniently seen, but very little attention to that which is never seen in the nursery of future consequences. It's "I can't be concern about what I can't see", so I'll just act and hope for the best- this is the alter of "practical men"; when it is always having fidelity to principle, especially if that principle is rooted in Law, that must be embraced in order to see the higher good behind its veil; otherwise, why have principles at all! If a principle is rooted in Law, it can only be circumvented by a higher Law; no different than the Law of Aerodynamics superseding the Law of Gravity that gives us the ability of flight. This is why we are lost; because it's about what "I" want-the ego in Man, not what "I AM" wants-that which is greater within us!

Posted by: D-0f-G | December 6, 2010 6:21 PM | Report abuse


You can rationalize this a million different ways.

The President caved.


Posted by: StevenK3 | December 6, 2010 6:25 PM | Report abuse

Interesting that the Democrats claimed the Bush tax cuts only helped the "rich" yet they don't want the middle class to lose its unhelpful tax cuts. Sounds like typical Democrat reasoning.

And why has the jobless rate jumped up nearly 3 percentage points since Obama signed that stimulus, which was going to "create or save" 3 to 4 million jobs and keep the jobless rate at 8%. Would love to hear an explanation.

Moreover, the Democrats ignore the fact that when they assumed the majority in Congress in 2007, the jobless rate was 4.6% thanks to the Bush tax cuts that ushered in 48 months of consistent economic growth. But Nancy banged that gavel in support of every Dem spending wish to increase the national debt by $5 trillion. And of course, that housing bubble created by Carter, Clinton, Dodd, and Frank burst too.

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

Rush Limbaugh is right on one thing. These are not stimulus. They are just an extension of the status quo, no new money going out.. A rise in the upper income (just the income above $250,000, not the first $250,000 of the rich) might have been negative, but not if it were shifted into lower and middle class stimulus. Say, on social security, or acceleration of health care benefits. (Obamacare is a fiscal drag until 2014 when it goes deeply in the red when we need reduction in deficits.) Obama is just afraid he will be accused of causing a poor economy by taxing the rich, but he will be accused anyhow. As he is, he just adds on the universally-believed charge by Carville.

Posted by: jhough1 | December 6, 2010 6:32 PM | Report abuse

WELL, WE KNOW THAT NO ONE IN THE WHITE HOUSE HAS AN OUNCE OF BRAINS OR AN OUNCE OF INSIGHT INTO HOW THE WORLD WORKS. SO, WELL SIMPLY SIT BACK AND TAKE THE CRAP FROM THEM AS THE CLINTONS AND OBAMAS CONTINUED TO GET RICHER AND RICHER. MY PARENTS ARE DEAD. THEY WORKED HARD ALL THEIR LIVES AND PAID THE TAXES DUE. NOW I AM UNABLE TO PROVIDE CHRISTMAS PRESENTS TO MY TWO CHILDREN THANKS TO THE HOSE JOB OUR GOVERNMENT HAS DONE TO US.

Posted by: sarahannson | December 6, 2010 6:34 PM | Report abuse

It is just good politics to divide the population into small segments and attack each segment separately in sequence at a time with new taxes, starting with the “wealthy.” Anyone who thinks their own taxes won’t eventually be raised by this tactic is just kidding themselves. In the long run, the deficits Obama is projecting will require raising everyone’s taxes just to pay the interest on the debt. Once you take the money from the wealthy, who is left? Just look around, it is you.

Posted by: droberts57 | December 6, 2010 6:35 PM | Report abuse

It certainly is critical that preservation of long term unemployment benefits is part of any deal on the tax cuts. It would be terrible policy to give the rich and the well off a break while leaving the real victims of the economic problems to beg in the street. The rest of the argument is dubious. Our economy is still on the life support of policies with no real objective beyond preventing its collapse. Perhaps its state is still so bad that it could not survive without taking on more debt to sustain tax breaks for the better off parts of the American population. But any real progress towards any kind of sustainable economic progress is going to require some major physical therapy. That therapy will not happen until the life support is taken away and the economy begins to make some effort to walk on its own. It is very hard to predict both what will happen over the next two years and how the American electorate will react to it. But the concept that the Democrats can win by promoting class warfare between the rich and the well off will probably turn out to be a fantasy of political operatives who have spent too much time in Washington.

Posted by: dnjake | December 6, 2010 6:38 PM | Report abuse


At least Mr. Obama did a nice job of explaining to the American people why he caved in to the terrorists demands.

Posted by: StevenK3 | December 6, 2010 6:43 PM | Report abuse

So, Obama calls Democrats to the White House to work out the details on a compromise. A few Democrats show up then leave saying that no agreement could be reached. Looks like Obama can't even get an audience with his own party. when he does show up.

Posted by: wmboyd | December 6, 2010 6:46 PM | Report abuse

I disagree with Mr. Obama on this one.


The cost of even two more years of Bush's tax breaks for the wealthiest among us is going to be near-fatal to our credit rating as a country.


Plus, Mr. Obama rewarded the GOP domestic terrorists. As everyone knows, when bullies and thugs are rewarded, they not only don't stop, they ESCALATE their terrorism.

Posted by: StevenK3 | December 6, 2010 6:49 PM | Report abuse

Between 2001-2004 George W. Bush pushed through a series of annual tax cuts for investors and corporations that amounted to a total of $3.4 trillion over the recent decade, according to the Center on Budget and Policy Priorities. Every tax cut bill passed between 2001-2004 was called a jobs creation bill. More than 80% of the $3.4 trillion eventually accrued to the wealthiest 20% of households and corporations, and most of that to the top 0.1%, or 100,000 households, and the S&P's largest companies. And what did George W. Bush's business-investor tax cut produce in terms of jobs? The period 2001-2004 witnessed the weakest jobs creation on record following a recession. It took a full 46 months just to recover the level of jobs in the U.S. that existed in January 2001, when the recession began. Estimates today after the current recession are that it will take 7-8 years to recover the lost jobs, if even then.

Another, more recent test of the "business tax cuts create jobs" idea happened in the spring of 2008. Bush and Congress passed a $168 billion stimulus bill as the recession of 2007-2010 began to deepen. About $90 billion of that comprised tax cuts. What jobs did it create? None. The jobs market collapsed in the second half of 2008 at a rate of nearly one million a month for six months, a rate of job loss that roughly paralleled that of 1929-30.

The Obama stimulus bill of 2009 is yet another example of why tax cuts in general, and business-investor tax cuts in particular, do not create jobs. Of Obama's original $787 billion stimulus passed in February 2009, about half were tax cuts and more than $225 billion were specifically business-investor cuts. Twenty months later we have virtually no net job creation. Private employers have created about 900,000 jobs in 2010, the majority of which are part time or temporary jobs. For its part, the federal government has created no net new jobs since Obama came into office, while State and Local government have laid off hundreds of thousands over the past year and even more cuts are planned for 2011. The U.S. Labor Department's most conservative estimate of unemployment (called the 'U-3' statistic) today is 9.8% and 15.1 million jobless. The Labor Department's more accurate estimate (called the 'U-6' statistic) today is 17.0% and roughly 23 million jobless.

So what did John Q. Taxpayer get for all that tax cutting? Certainly not jobs, but instead a huge deficit bill now coming due. Nonetheless, the debates in Washington now still focus on more tax cuts in 2011. So long as that's the focus, the U.S. unemployment situation will continue to stagnate or worsen.

Posted by: bromisky | December 6, 2010 6:52 PM | Report abuse

I'll say this. My wife and I would have had our taxes increased under the plan that kept the cuts in place for 95% of Americans. Despite the personal cost, I was in support of ending the tax cuts for higher-income earners. I think that the new deal is a true compromise in that nobody got everything that they wanted.

The end result is going to be, however, no added stimulus to the economy and more debt - despite the Republicans best efforts to divorce the two. I can tell you that my family's extra cash won't be going to employ anyone. It won't be going to any vacations we weren't already considering, won't go to buying a new car, a new house or anything other than what we would have already done. That money is going directly into the bank. It won't even go into our qualified retirement plans where mutual funds could invest in companies to grow the economy because we already max out our contributions. Our extra tax money will be sitting in a bank account.

So thanks for the cash. Good luck finding a job.

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

I'll say this. My wife and I would have had our taxes increased under the plan that kept the cuts in place for 95% of Americans. Despite the personal cost, I was in support of ending the tax cuts for higher-income earners. I think that the new deal is a true compromise in that nobody got everything that they wanted.

The end result is going to be, however, no added stimulus to the economy and more debt - despite the Republicans best efforts to divorce the two. I can tell you that my family's extra cash won't be going to employ anyone. It won't be going to any vacations we weren't already considering, won't go to buying a new car, a new house or anything other than what we would have already done. That money is going directly into the bank. It won't even go into our qualified retirement plans where mutual funds could invest in companies to grow the economy because we already max out our contributions. Our extra tax money will be sitting in a bank account.

So thanks for the cash. Good luck finding a job.

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

Anyone except Caribou Barbie can beat this guy in 2012. Can you see Obama telling the Russians to get their missiles out of Cuba, or get ready for Nuclear War I? We would have had missiles in Cuba, Jamaica, Grand Cayman, Bermuda, Costa Rica, and Haiti. The Russians might have 'negotiated' a 'compromise' for the return of Alaska. Add another trillion to the deficit.

Posted by: billsimpson451 | December 6, 2010 7:02 PM | Report abuse

justthefacts14,

I'm all for having people pay their "fair share".

Over the past 30 years we've gutted or weakened financial regs, environmental regs, labor laws, consumer protection laws, and trade laws -- with almost all of the benefit accruing to the top income bracket.

We've financed 30 years of tax-cuts primarily benefiting the wealthiest Americans on the back of future wage earners. Something like 70 percent of the growth over the past 30 decades has accrued to the top income bracket -- a major deviation from prior decades.

Reagan even passed what was then the largest middle class tax INCREASE in order to preserve social security and Medicare -- while also putting a cap on the total contribution.

In 2008 we effectively bailed out the financial markets effectively saving 401K of those who actually have 401Ks and private retirement plans. Without the benefit of the federal treasury and the support of millions the retirement savings of the wealthy might have been completely wiped out.

So yes, while a return to the Eisenhower tax rates might be a little too aggressive, pre-Reagan rates would be more than equitable. An elimination of loop-holes like the Carried Interest Rule for Hedge Funds should also be a high priority.

As far as the budget-busting, job-destroying impact of the Bush tax cuts, it's possible to debate the degree of harm, but not so much the fact that the policy did damage. It was a nice book-end on the domestic side of the equation to the "self-financing reconstruction" that wasn't in Iraq on the foreign policy side of the equation.

Posted by: JPRS | December 6, 2010 7:09 PM | Report abuse

I appreciate the attempt at sugar coating this depressing situation but I don't get your numbers. You say the tax cuts at the top will pump 100 billion into the economy, where does that come from? The rich are going to sit on that money.
Secondarily, you are in effect saying that in 2012 the Democrats should run on raising taxes. That doesn't sound like a recipe for success.

Posted by: johndouged | December 6, 2010 7:11 PM | Report abuse

Correction: "Something like 70 percent of the growth over the past 30 decades has accrued to the top income bracket"

30 YEARS, not decades.

Posted by: JPRS | December 6, 2010 7:12 PM | Report abuse

" if you believe that what matters for elections is the economy -- and you should -- then it's worth it for the White House to lose news cycles in 2010 if it means adding jobs by 2012."
------------------------------------------
Hmm, maye Obie realizes that after 2 years of shooting more holes in the bottom of the boat and watching the water rise, it's time to think about the boat sinking before 2012...

I think Ez is right about Obie's thought process. REELECTION hinges on dropping the 18% UM WAY down.

Posted by: illogicbuster | December 6, 2010 7:13 PM | Report abuse

F...ing Reetards.

Posted by: perhapsnot1 | December 6, 2010 7:17 PM | Report abuse

Bah. This is no "deal," this is a surrender.

Posted by: rusty3 | December 6, 2010 7:17 PM | Report abuse

Did anyone see the President speak on this just about 45 minutes ago.
He's for the compromise..
but now House Democrats are mad...

Everyone who wants unemployment extended --
go to HOUSE.GOV and write each Democratic House Rep and give them your story. Tell them how you can't afford house pmts, car pmts, or even food on the table if unemployment isn't extended and the fighting stops.
It's easy to flood their inboxes.

Posted by: TheBabeNemo | December 6, 2010 7:19 PM | Report abuse

The country needs a president with character, the ability to believe in something and to stand for something. Barack Obama is not that person and if he faces a person who means what he/she says, he will lose reelection and he should lose. He lacks character, the ability to do what he thinks is right regardless of its consequences for him. Right now, I'm through with him. He's a waffler, an appeaser, our Neville Chambelain for this wonderful counntry. I thought that he was better than John McCain and I voted for him. And he is better than John McCain; but he's not good enough. Aaron Horowitz.

Posted by: aaronhorowitz | December 6, 2010 8:44 PM | Report abuse

Hopefully this episode "Tales of the American Orligarchy" will serve as a lesson to the public that the only way to overcome the divisive grip of the "plutocrats" is for the people to stop carrying the banner of illusional differences. And we will know that day, when the tea party can be reconciled with the NAACP, when the white nataionals realize that for over hundred years they have been "played", when self righteous heterosexuals understand that the substance of a person transcends his outer expression, when money in politics becomes a felony, when all states become red, white and blue states, when people realize that striving to be rich, for its own sake, is no longer a worthwhile aspiration, when the libraries are full on Saturday afternoons and the movie theaters are nearly empty, and when having hungry people on the streets is considered a crime against humanity. And when all of this has come to past, this will automatically rehabilitate the news media!

Posted by: D-0f-G | December 6, 2010 8:49 PM | Report abuse

Hopefully this episode "Tales of the American Orligarchy" will serve as a lesson to the public that the only way to overcome the divisive grip of the "plutocrats" is for the people to stop carrying the banner of illusional differences. And we will know that day, when the tea party can be reconciled with the NAACP, when the white nataionals realize that for over hundred years they have been "played", when self righteous heterosexuals understand that the substance of a person transcends his outer expression, when money in politics becomes a felony, when all states become red, white and blue states, when people realize that striving to be rich, for its own sake, is no longer a worthwhile aspiration, when the libraries are full on Saturday afternoons and the movie theaters are nearly empty, and when having hungry people on the streets is considered a crime against humanity. And when all of this has come to past, this will automatically rehabilitate the news media!

Posted by: D-0f-G | December 6, 2010 8:50 PM | Report abuse

Hopefully this episode "Tales of the American Orligarchy" will serve as a lesson to the public that the only way to overcome the divisive grip of the "plutocrats" is for the people to stop carrying the banner of illusional differences. And we will know that day, when the tea party can be reconciled with the NAACP, when the white nataionals realize that for over hundred years they have been "played", when self righteous heterosexuals understand that the substance of a person transcends his outer expression, when money in politics becomes a felony, when all states become red, white and blue states, when people realize that striving to be rich, for its own sake, is no longer a worthwhile aspiration, when the libraries are full on Saturday afternoons and the movie theaters are nearly empty, and when having hungry people on the streets is considered a crime against humanity. And when all of this has come to past, this will automatically rehabilitate the news media!

Posted by: D-0f-G | December 6, 2010 8:50 PM | Report abuse

TheBabeNemo,
I fully appreciate your need for unemployment insurance (UI). We have 1 member of family on UI, 1 college grad working retail, 2 unemployed with no benefits. All have been looking for work and will take it if it were out there. We may soon have 3 young adults moving back into our home.

I assert that any RATIONAL government would get UI benefits without paying ransom. The rest of the "deal" is a disaster.

There is INVERSE correlation between job creation and the Bush tax cuts. In simple terms, more tax cuts = fewer jobs. the money is not going into productive investments.

Posted by: boscobobb | December 6, 2010 10:23 PM | Report abuse

Ezra, I hope you're right about the economy but I think it's the wrong kind of "stimulus" and probably can have only enough impact to continue what's been done to date, i.e., keep things from getting even worse as corporations and the wealthy build their idle bank accounts.

Posted by: pjro | December 6, 2010 10:26 PM | Report abuse

Hate the deal. Unemployment insurance and tax credits are mere government spending. Increasing government spending only signals to investors that extra taxes will be necessary in the future. Economic freedom does not increase, and growth will be restrained.

Posted by: cprferry | December 6, 2010 10:58 PM | Report abuse

Bromiskey,
You've confused tax credits with tax cuts. Tax credits do not free economic activity, they redirect it to those activities supported by government and ultimately restrain it. If you want to see growth you must allow the economy to direct resources to its most beneficial activities, not those simply desired by the government and lobbyists.

Posted by: cprferry | December 6, 2010 11:03 PM | Report abuse


The market rates may have gone down, or remained the same. For the homeowner to get qualified for lower rates, there are certain prerequisites but I would recommend you search online for "123 Mortgage Refinance" before you decide because they can find the 3% refinance rates.

Posted by: lindamckee | December 7, 2010 2:36 AM | Report abuse

The fundamental difference between our President and Republicans is that THEY ARE PLAYING A GAME while he is not.
Republicans are willing to destroy this country because it's all a game to them. Again thank GOD our President isn't playing their game.
Yeah, he didn't want to extend the tax cuts, but he saved jobs and perhaps even LIVES with this deal.

Posted by: angie12106 | December 7, 2010 4:05 AM | Report abuse

Comment after comment after comment of tunnel-visioned commenting...

I'm liberal. I'm progressive. But unlike (it seems) SO many who are proud of those labels, I'm capable of looking at more than one possibility at a time. I argued the following on Daily Kos, too.

Everyone is screaming at Obama for not fighting, not doing this or that that worked for so and so and this or that time, not playing the game as well as the opposition, not, not, not, not, not...

But what was that the man said" That he wanted to "change the way Washington does business," and thereby "do things differently."

Ever had a President as criticized by his puditry and rantery base as this? Hmmmm, different, huh?

Ever had a President whom some of his "past" supporters actually start to question as to his actual political leanings? Hmmmm, different, huh?

Ever had a President who frustrates the media, the Congress and the political junky class alike by not charging into debates, showing his hand early on, and not giving in to the media's insatiable desire to cover a fight? Hmmmm, different, huh?

Ever had a President whose pronouncements on legislative matters are presented mostly in soft, conciliatory tones rather than sharp, stident ones--as though he's keeping an open mind on all of the possibilities and not committing himself to any particular one right away? Hmmmm, different, huh?

Ever had a President who leaves legislation in the hands of the legislature MOST of the time, instead of barging in himself and proclaiming his "leadership" of a branch of government that is NOT HIS TO LEAD? Hmmmm, different, huh?

Ever had a President ONLY step in to get Congress to act on something (DADT) when the WRONG BRANCH OF GOVERNMENT (the Judicial branch) may be headed to make the decision instead? Hmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm...

Gee, ya think that maybe this guy really IS a constitutional scholar, believes in the intent of the original set up of government established by the document, and is willing to take a lot of flack to allow government to work the way IT WAS PLANNED TO WORK?

Different, huh?

Posted by: pasc1 | December 7, 2010 7:21 AM | Report abuse

Eleven-dimensional chess, FTW!!11!

Posted by: ibc0 | December 7, 2010 10:35 AM | Report abuse

In the long run, we'll all be dead. Republicans are taking this deal because it avoids raising taxes in the middle of a slow-motion, jobless recovery. Hiking taxes now, even just on top earners, would likely result in a double-dip recession. While this would sink Obama's re-election hopes, it would also destroy the country. The whole reason Republicans want to beat obama is to prevent him from destroying the country. Pretty easy decision.

Posted by: reheiler | December 7, 2010 1:00 PM | Report abuse

In the long run, we'll all be dead. Republicans are taking this deal because it avoids raising taxes in the middle of a slow-motion, jobless recovery. Hiking taxes now, even just on top earners, would likely result in a double-dip recession. While this would sink Obama's re-election hopes, it would also destroy the country. The whole reason Republicans want to beat obama is to prevent him from destroying the country. Pretty easy decision.

Posted by: reheiler | December 7, 2010 1:00 PM | Report abuse

If Obama and Biden step down now the presidency can go to an actual and effective Democrat, Nancy Pelosi. In this way we can declare that two barriers in American politics have been broken, by Democrats, and we can get a President who can negotiate somewhat better than a five year old swapping big shiny nickels for grubby little old dimes.

Posted by: sparkplug1 | December 7, 2010 7:15 PM | Report abuse

I don't understand what's to prevent Republicans from coming back to voters in 2012, in a much improved economy, and saying tax breaks for the job creators worked (unemployment is now less than before the comprise bill). "If Democrats had only listened to Republicans sooner," they will say. It's not the triumph of the rational argument that matters most in our 24 hour news cycle, but the bait and switch (and the heartfelt symbolic comment). Obama just handed Republicans a victory in 2012 (but we won't realize it for another two years).

Posted by: eidyl | December 8, 2010 11:28 AM | Report abuse

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