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Van Hollen: Vote on middle class tax cuts would be good for Dems

The chairman of Dem efforts to hold the House says a highly-charged vote on whether to extend the middle class tax cuts would provide a lift to Dem candidates in the midterm elections, drawing a sharp contrast between Dems as defenders of the middle class and Republicans as defenders of the rich.

DCCC chair Chris Van Hollen cautioned in an interview with me that no decisions had been made. But his assessment could provide fodder to those pushing a vote as the best way to give Dems a burst of populist energy heading into the fall. Some moderates are balking at this fight, and Dem leaders are engaged in intense debate about how to proceed.

"A vote on this issue would help crystallize the choices before the voters," Van Hollen told me. "It would demonstrate clearly that Republicans want to hold tax relief for 98 percent of the American people hostage in order to get tax breaks for the top 2 percent."

"Without talking specifically about whether we will or won't have a vote, this is an issue where a very clear contrast can be drawn," Van Hollen said.

Even if a vote were decided upon, there would still be major procedural issues to resolve, such as which chamber would vote first, or whether the House might vote even if the Senate doesn't. Another possibility: If Republicans block a vote in the Senate on whether to extend the middle class tax cuts, Dem leaders may conclude that a clear enough contrast between the two parties has already been drawn, doing away with the need for a vote in the House.

Van Hollen argued that a House vote would force officials and candidates to take a stand on extending middle class tax cuts, irrespective of whether they are extended for the rich. Van Hollen added a vote would call Republicans' bluff after leader John Boehner seemed to muddy the GOP position by claiming he might support extending the middle class tax cuts if it were the only option.

"That was a clear indication that he understands that the American people are not going to put up with the Republican position," Van Hollen said. "Having this issue on the record would help crystallize the differences between the candidates in this election."

But Van Hollen again cautioned that no decisions had been made. "People who have been back home in their districts across the country are just now coming together," he said. "Before we finalize any plans we need to have a discussion with the caucus."

By Greg Sargent  |  September 14, 2010; 2:44 PM ET
Categories:  2010 elections , House Dems , House GOPers , economy  
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Comments

I'd suspect the translation here is that a decision ~has~ been made but they choosing their steps carefully as they roll it out. One assumes that a some their most vulnerable members are feeling considerable heat over the issue and a few are likely to actually be opposed themselves on principle -- Democratic party is a fairly large tent after all (much to our eternal annoyance) -- so they just need to tread a little lightly.

Posted by: CalD | September 14, 2010 2:50 PM | Report abuse

One has to wonder if the Dems know what in the hell they are doing? Shouldn't they have had their strategy on this all worked out some time ago? They've had - oh - a few *years* to figure out how to play this hand...

Chris Van Hollen:

"If [Republicans] were to come back and say, 'hey, let's just do one year for the top 2 percent, and permanent for the middle class,' that would be something that obviously people would have to think about," Van Hollen said in an interview with Bloomberg this past weekend."

Posted by: sbj3 | September 14, 2010 2:51 PM | Report abuse

I need to learn how to proof read.

Posted by: CalD | September 14, 2010 2:52 PM | Report abuse

sbj -- he walked that back on msnbc today, and reiterated his support for obama's position...

Posted by: Greg Sargent | September 14, 2010 2:54 PM | Report abuse

"Some moderates are balking at this fight"

E.G., Blue Dogs, who are essentially Republicans that lost their way somehow. It's time for the Democratic wing of the Democratic Party to stand up and offer a clear difference between themselves and the class warfare warriors of the GOP.
I could care less if these Blue Dogs go down in Nov. Cleanse the party of these people, let the GOP have the House for 2 years, re-group and then run real Democrats in some of these swing districts in 2012. Some of the people who vote against their own interests need a couple more years to feel the pain of a GOP controlled House before they slowly come around and realize who is really on their side. No wonder the GOP is playing the Muslim card. They don't have a leg to stand on when it comes to taxes and the overall economy.

Posted by: filmnoia | September 14, 2010 2:55 PM | Report abuse

FULL STEAM AHEAD.

Well DONE Mr. Van Hollen. Well done indeed.

Posted by: Ethan2010 | September 14, 2010 2:56 PM | Report abuse

The best strategy is one that confirms what people already believe:

1). Republicans support the rich.

2). Democrats support everyone else.

Posted by: 12BarBlues | September 14, 2010 2:57 PM | Report abuse

@Greg: "sbj -- he walked that back on msnbc today, and reiterated his support for obama's position..."

That's my point - do they know what they are doing?

Looking ahead - are you in favor of Pelosi requiring a super-majority vote for a GOP alternative in the House?

Posted by: sbj3 | September 14, 2010 3:01 PM | Report abuse

filmnoia,

Not only that, but if the GOP wins one or both houses of Congress and then utterly fails in their attempts to foist their pro-corporate, screw-everybody-else economics on the American people, they are going to see a HUGE backlash from, among other demographic groups, the ONLY real solid GOP demo left in their party: white seniors.

If a return to GOP rule in Congress wouldn't damage the country even more than they already have, it would almost worth them taking over JUST so they can lose their last true bastion of support once and for all.

Posted by: Ethan2010 | September 14, 2010 3:02 PM | Report abuse

@Greg

Two things:

1) TPM is reporting that Sen. Reid is saying that he'll hold a vote on tax cuts within a few weeks. This would answer the question about the timelines (and the Senate going first would thrill the House, I'm sure).

2) "Some moderates are balking at this fight..."

Are you contacting any of those that are "balking" at this, and asking them to explain their position? If not, please do so. If you have, letting us know you are awaiting comment would put pressure on them to respond to you.

There's a line between commentary and investigative journalism. We need more of the latter on this issue.

Posted by: TheBBQChickenMadness | September 14, 2010 3:03 PM | Report abuse

Wheeeeeee!

@tpm:

Reid: We'll Bring Tax Cuts To Vote

Brian Beutler reports in that Harry Reid expects to hold a Senate vote on extending the Bush tax cuts within the next three weeks. More soon...

GREAT stuff. Fired Up!

Posted by: Ethan2010 | September 14, 2010 3:04 PM | Report abuse

I Still Maintain.

If The Democrats let the Bush Tax Cuts for the Very Wealthy expire, and it ends up causing even one Distressed Billionaire to think twice about purchasing a Professional Sports Team, or marrying another Trophy Wife, then the American People will never forgive The Democrats.

Posted by: Liam-still | September 14, 2010 3:05 PM | Report abuse

This would be a really good time for President Obama to seize control of the debate (not to mention, the populist mantle) by announcing he will veto any bill that extends the tax cuts for The Rich. It will also show that Obama is the head of the Democratic Party and make other Democrats recognize that. All of this is desperately needed if the Democrats hope to survive November.

Posted by: wbgonne | September 14, 2010 3:06 PM | Report abuse

Just as good:

Reid tweets Lady Gaga:

@ladygaga There is a vote on #DADT next week. Anyone qualified to serve this country should be allowed to do so http://bit.ly/9ucdIj #nvsen

Give em Hell, Harry.

Posted by: Ethan2010 | September 14, 2010 3:06 PM | Report abuse

@Greg

My last comment wasn't to dismiss the actual journalism in this post - which is much more than we are getting from many other outlets.

I just meant we need more of it.

Re-reading, I could see how it might be misconstrued. I apologize if it came off that way.

Posted by: TheBBQChickenMadness | September 14, 2010 3:07 PM | Report abuse

totally understand, BBQ.

and I have been trying to contact moderates, with very little luck...

Posted by: Greg Sargent | September 14, 2010 3:09 PM | Report abuse

BTW: Greg, I suspect that you and Josh Marshall and the rest of the Professional Left have had a significant impact on the Democrats on the tax issue. Keep up the great work!

Posted by: wbgonne | September 14, 2010 3:09 PM | Report abuse

Lieberman Won't Filibuster Obama's Tax Cut Plan (UPDATE)‎ - 54 minutes ago

"I'm not going to hold middle class tax cuts hostage," Lieberman said, according to the Huffington Post's Arthur Delaney. A pledge not to filibuster Obama's...

http://www.huffingtonpost.com/2010/09/14/lieberman-in-2003-repeal-_n_716289.html

Yes indeed!

I'm having spotty internet probs, so can't read the article but that lede looks verrry promising.

Posted by: Ethan2010 | September 14, 2010 3:13 PM | Report abuse

So, if Obama got say, 75 votes and made a compromise to extend the top 3% for an additional two years and make the middle class cuts permanent, would that be a sellout to progressives?

Posted by: mikefromArlington | September 14, 2010 3:15 PM | Report abuse

"I'm not going to hold middle class tax cuts hostage," Lieberman said, according to the Huffington Post's Arthur Delaney.

I'm glad to see they've grasped that important terminology.

Posted by: mikefromArlington | September 14, 2010 3:19 PM | Report abuse

Small Business Relief Bill Moves forward.

" - Democrats in the Senate advanced a measure to help small businesses on Tuesday, less than two months before they face voters who blame them for an economy still burdened with high unemployment.

The 61 to 37 vote enables Democrats to move toward a final vote on a long-stalled package of lending incentives and tax breaks for small businesses, possibly by the end of the week. The House of Representatives has already passed a similar version of the bill.

The bill, which President Barack Obama and his fellow Democrats say will spur hiring, represents one of the party's final chances before the November 2 elections to show voters they are working to improve the economy."

Is there anything that Josh Marshall can not get Democrats to move on?(Snark)

Posted by: Liam-still | September 14, 2010 3:22 PM | Report abuse

"extend the top 3% for an additional two years and make the middle class cuts permanent"

How does that differ from what the GOP wants? It doesn't so it isn't a "compromise" (which, in reality, is Rebublicrat-speak for Democratic capitulation to GOP positions). Further, such a "compromise" denies Democrats the populist boost that they will otherwise get so it is stupid politically. Third, it does nothing to help the deficit so it's foolish policy. Fourth, punting the tax issue 2 years means it will re-occur during the 2012 Presidential race and I don;t see that going well for the Democrats, meaning that the Dems will almost certainly capitulate under the pressure of a presidential race. So, once again, how does that "compromise" differ from utter capitulation?

Posted by: wbgonne | September 14, 2010 3:26 PM | Report abuse

mikefromA,

Even better, Dems are going after Lieberman for flip-flopping on tax cuts for the rich:

"""the fact that Hill aides are sending around quotes highlighting the evolution of his position remains noteworthy. Lieberman, after all, is not the only former opponent of the Bush tax cuts for the wealthy now sounding a different tune. Sen. Evan Bayh (D-Ind.) and Kent Conrad (D-N.D.) are in that camp as well.

But the former Democratic vice presidential nominee pushed his party's leadership to the breaking point during the course of crafting health care reform. He managed to stay in somewhat good graces by ultimately supporting the final, scaled-down package. And could very well repeat the act during the tax cut debate (much of this depends on how many seats Democrats lose in the November elections). Clearly, however, patience is wearing thin. """

Pretty awesome.

Posted by: Ethan2010 | September 14, 2010 3:26 PM | Report abuse

"How does that differ from what the GOP wants?"

Everyone but Boehner wants them permanent I thought.

Posted by: mikefromArlington | September 14, 2010 3:30 PM | Report abuse

We can not afford to borrow money to pay for an extension of Bush Tax Cuts for The very wealthy. Those are the same crowd, that are sitting on massive amounts of money, and refusing to use it to help the economy, or to lend it out to small businesses, so why the hell should the government borrow at least 200 Billion Dollars, to extend tax cuts for them, for another three years?

To hell with that nonsense. The bill is set to expire. Let it do so.

Posted by: Liam-still | September 14, 2010 3:32 PM | Report abuse

"The best strategy is one that confirms what people already believe:

1). Republicans support the rich.

2). Democrats support everyone else."

Absolutely, this needs to become the Dem mantra. Marginalize these bastards.
The GOP, if nothing else, is great in picking a theme and pounding on it over and over. It's easier for them to do given the lemming-like authoritarianism of the right wing personality. The Dems need their version of the Armeys and Gingrichs to talk to the "troops", and have them get on TV and be considered part of the debate. Right now anyone from the Left who appears on TV is usually portrayed as out of the mainstream, therefore someone whose ideas aren't ready for the normal debate.

Posted by: filmnoia | September 14, 2010 3:35 PM | Report abuse

That's fine. I just wanted to see what people thought. I think I get the gist.

Posted by: mikefromArlington | September 14, 2010 3:37 PM | Report abuse

If we are actually getting to the substance of the matter, here's another point: Just who made off with all the money in the country when Wall Street collapsed? Was it poor people? No. Was it the Middle Class? H*ll no. It was the SuperRich, the Plutocrats, the ones who will pay slightly more in taxes (but even then will be at historically low rates). It's called Populism and Democrats used to be very good at it.

Posted by: wbgonne | September 14, 2010 3:39 PM | Report abuse

wbgonne:

"This would be a really good time for President Obama to seize control of the debate (not to mention, the populist mantle) by announcing he will veto any bill that extends the tax cuts for The Rich. "

Do you really want Obama to hold taxcutsforthemiddleclass hostage to punishing "the rich"?

"Just who made off with all the money in the country when Wall Street collapsed?"

No one. The problem with the "collapse" of Wall Street was that a huge amount of (paper) wealth got destroyed.

BTW...$250k a year does not make anyone "SuperRich".

Posted by: ScottC3 | September 14, 2010 3:51 PM | Report abuse

Wb, so true.

Wall Street bilked America of TRILLIONS of wealth.

Instead of investing that money into creating jobs in American industry, they funneled money to the GOP and lobbyists to stop the Dems from fixing the financial system.

This is the corporate ultra-elite for ya.

Screw us to the hilt, come begging to be "saved," then turn around and screw us all over again.

It's time for EVERYONE in America to stand up to this charade perpetrated by Wall Street and the Republican Party, starting with ending these insane Bush tax cuts for the rich.

Posted by: Ethan2010 | September 14, 2010 3:53 PM | Report abuse

People making 250k a year have nothing to worry about. It's the people making 251k that should be in a panic because they will be paying a whopping $34 more bucks in taxes.

THAT'S SOCIALISM!!! *DROOL* *SLOBBER*

Posted by: mikefromArlington | September 14, 2010 3:55 PM | Report abuse

"The problem with the "collapse" of Wall Street was that a huge amount of (paper) wealth got destroyed."

No it didn't. Most of it was transferred to the Plutocrats in the greatest swindle in economic history. Some wealth got destroyed but that was ours, not the Plutocrats'. See the National Debt for proof.

Posted by: wbgonne | September 14, 2010 3:56 PM | Report abuse

"Independents, 53-38, back the middle class extension only"

http://tpmdc.talkingpointsmemo.com/2010/09/democrats-taking-temperature-on-tax-cuts-tonight.php

What's that ScottC?

Oh you DON'T want Indie votes in November?

Okee-doke.

Posted by: Ethan2010 | September 14, 2010 4:00 PM | Report abuse

Ethan:

You are a trooper, Brother.

Posted by: wbgonne | September 14, 2010 4:00 PM | Report abuse

"No one. The problem with the "collapse" of Wall Street was that a huge amount of (paper) wealth got destroyed."

Well "paper wealth" sure made a comeback in 2009. Wall Street profits were up $55 billion compared to $42.6 billion in losses in 2008. And bonuses were up anywhere between 17% and 31% depending on the firm.

I agree $250k is not super rich, that's why only their income above that will be taxed at the slightly higher rate.

Posted by: lmsinca | September 14, 2010 4:01 PM | Report abuse

Mike from Arlington, Ethan, WBgonne


LET ME GET THIS STRAIGHT:

Obama is NOW supporting BUSH'S TAX CUTS.

AND that is a VICTORY FOR THE DEMOCRATS ???


HA HA HAAAA HAA HAAAA


ROTFL ROTFL ROTFL ROTFL ROTFL


THAT IS HILARIOUS !!!

.

Posted by: SaveTheRainforest | September 14, 2010 4:03 PM | Report abuse

wbgonne:

"Most of it was transferred to the Plutocrats in the greatest swindle in economic history."

How? Please be specific about the nature of this "swindle", who specifically was involved (name names), and how this "tradsfer" was effected.

Posted by: ScottC3 | September 14, 2010 4:04 PM | Report abuse

Glad to see some others coming around to my point about how the bailouts were done mostly for the benefit of the very wealthy, so paying most of it back over the next 10 years via very moderate marginal tax rate increases is the least they can do.

Much of the losses that the wealthy saw in their financial assets have been recouped since TARP passed almost 2 years ago. Without TARP, they would have been left with little or nothing, and would be a long long way from getting back to where they were. They spent the money - or rather it was spent mostly on their behalf - so they should pay it back.

Posted by: JennOfArk | September 14, 2010 4:07 PM | Report abuse

Obama now is supporting Bush's tax cuts....


What is next ???


Obama supports Iraqi War....

Obama keeps Gitmo Open....

Obama gets TOUGH on Terrorists.....

Obama buys a ranch in Texas......


.

Posted by: SaveTheRainforest | September 14, 2010 4:09 PM | Report abuse

Cheers WB, cheers cheers.

We're sitting here pressing the GOP to support the Obama Middle Class Tax Cuts and where's the GOP?

They're busy fighting TOOTH and NAIL to preserve...

wait for it...

wait for it...

FEDERAL TAXPAYER SUBSIDIES...

for...

The OIL & GAS INDUSTRY!

Bwaaaaaahahaha!

Can't make this stuff up.

http://www.washingtonmonthly.com/archives/individual/2010_09/025661.php

Posted by: Ethan2010 | September 14, 2010 4:09 PM | Report abuse

"agree $250k is not super rich, that's why only their income above that will be taxed at the slightly higher rate"

I agree, also. So let's have several more brackets above 250K, the top one set at 70%. Just like it is whenever our economy is healthy.

Posted by: wbgonne | September 14, 2010 4:11 PM | Report abuse

SaveTheRainforest, Obama is only looking to make middle class tax cuts permanent.

Republicans have decided to hold 97% of the population hostage for a payoff to 3% of the population with more debt we cannot afford.

We have to deal with the deficit. The only group who is able contribute now during the slagging economy are the high end earners whom end up saving much of the extra tax cuts.

Pretty shallow of Republican to be so selfish.

Posted by: mikefromArlington | September 14, 2010 4:12 PM | Report abuse

"Do you really want Obama to hold taxcutsforthemiddleclass hostage to punishing "the rich"?"

Though you aren't sincere, that is a valid question. Here's my answer: If Obama let's the Congressional Democrats handle this tax question it will be HealthCareClusterf*ckRedux. Plus he desperately needs the wasta. Obama NEEDS a fight. IMHO, of course.

Posted by: wbgonne | September 14, 2010 4:15 PM | Report abuse

Erratum:

"lets"

Posted by: wbgonne | September 14, 2010 4:18 PM | Report abuse

How? Please be specific about the nature of this "swindle", who specifically was involved (name names), and how this "tradsfer" was effected.

I'll try.

It started with this http://online.wsj.com/article/SB122156561931242905.html when AIG was bailed out in Sep of 2008.

AIG lending that directly paid off financial firms and primarily GS via debts paid from CDS's AIG was unable to cover on insurance purchases primarily of MBS's.

Posted by: mikefromArlington | September 14, 2010 4:22 PM | Report abuse

"Please be specific about the nature of this "swindle", who specifically was involved (name names), and how this "tradsfer" was effected."

That's what indictments are for.

Posted by: wbgonne | September 14, 2010 4:23 PM | Report abuse

lmsinca:

"Well "paper wealth" sure made a comeback in 2009."

A little, but not much. The Dow went from 9,000 to about 10,400, so a gain of 16%, but still way way off the highs of 13,000 in '08. The value of houses (the store of wealth for most people) was flat, if not down, in most areas. So, no, it didn't really make much of a comeback.

Lots of firms on Wall Street did make a lot of profits, true. But they did so with a lot fewer employees (ie a lot fewer "greedy, fat-cat" bankers in PL parlance). And it is not clear to me why Wall Street profits are a bad thing. If banks are to become/remain healthy (after posting huge losses in '08), they need to make profits. And don't forget that if bonuses were up 30% from 2008, they were down in 2008 by nearly 50%. So they are "up" from a (relatively) very low starting point.

Posted by: ScottC3 | September 14, 2010 4:29 PM | Report abuse

"In a strategy shift on immigration reform, Senate Majority Leader Harry Reid (D-Nev.) announced Tuesday that Democrats will try to pass a bill legalizing certain undocumented immigrants if they attend college for two years or join the military.

Read more: http://www.politico.com/news/stories/0910/42153.html#ixzz0zXPcHsWr

Who ARE these guys!? Where did the milquetoasts go?

Posted by: wbgonne | September 14, 2010 4:32 PM | Report abuse

Mike from Arlington, wbgoone, Ethan


The truth is Obama is NOW supporting BUSH'S TAX CUTS.


How is that a victory for the democrats ???


No one is going to vote for any democrat in the country - just because suddenly they NOW support Bush's policies.

The whole thing is ridiculous.


All the democrats are trying to TALK THEMSELVES INTO how good this is for the democrats.


Meanwhile - the economy is STILL SUFFERING - AND OBAMA'S JOB CREATION WEBSITE IS STILL SHUT DOWN.

The American People want to hear about the economy - and unemployment - NOT about the health care plan which is a DRAG ON HIRING.


Meanwhile, the democrats STILL ARE SAYING THEY WANT TO RAISE THE TAXES DOWN THE ROAD.


.

Posted by: SaveTheRainforest | September 14, 2010 4:33 PM | Report abuse

All, tensions on the Sharron Angle campaign:

http://voices.washingtonpost.com/plum-line/2010/09/sharron_angles_nevada_and_wash.html

Posted by: Greg Sargent | September 14, 2010 4:35 PM | Report abuse

It is HILARIOUS how some democrats here are now calling BUSH'S TAX CUTS - AND NOW SAYING THEY ARE OBAMA'S TAX CUTS.


When Obama is just keeping the tax rates the SAME, and RAISING other tax rates.


Hilarious.

WHAT IS NEXT IN THIS MARKETING CAMPAIGN???


Obama's Iraqi War.


Obama's War on Terror


After saying that they HATED BUSH and his tax cuts for so long - how in the world can the democrats try to take BUSH'S TAX CUTS ???

Hilarious.

.

Posted by: SaveTheRainforest | September 14, 2010 4:39 PM | Report abuse

DAMN WB, that's great.

Posted by: Ethan2010 | September 14, 2010 4:41 PM | Report abuse

Jenn:

"the bailouts were done mostly for the benefit of the very wealthy, so paying most of it back over the next 10 years via very moderate marginal tax rate increases is the least they can do."

Of the major financial institutions that received TARP funds, all of them except for AIG and Citigroup have already repaid the funds, with interest.

"Much of the losses that the wealthy saw in their financial assets have been recouped since TARP passed almost 2 years ago."

It doesn't make a lot of sense to speak of "the wealthy" as a unitary thing. Some people who were wealthy in early 2008 are no longer among the wealthy at all, having seen their life savings evaporate when the companies they worked for (and had invested heavily in) went under. Others wealthy people have made wise investments had recouped a lot of their wealth. Still others are essentially treading water from where they were in 2008.

Posted by: ScottC3 | September 14, 2010 4:46 PM | Report abuse

What the liberals cannot speak do is the moral and ethic props for hammering the "rich" for the benefit of the "poor".

As I noted earlier, in a rob peter to pay paul situation, the Democrats will never have a problem with the pauls, the tax recievers. But they will continue to have problems with the pauls, the tax payers.

Just look at the gloating here over a chance to confiscate money from the most productive people in our economy. talk about economic ignorance.

We've been down this road before. Carter took us there as I recall. If the liberals continue to punish success, as is their wont, then there will be less of it and all of us will suffer.

To say that taking more money from those with incomes over 250K will stop some mega rich person from buying a sports franchise is to demonstrate abyssal ignorance about how the American economy actually works.

if the government wants or needs greater revenue, the thing to do is make more millionaires, not punish those who have already achieved. What's so bad about prosperity kids?

Oh, yeah, I forgot, its the old class envy thing. liberals hate the successful because they can't or won't work for success themselves. What prevents, oh say, Ethan, from getting rich?

Posted by: skipsailing28 | September 14, 2010 4:57 PM | Report abuse

Scott, in a way you're arguing for the point I am making. Wall Street firms and many of the big banks were bailed out via corporate welfare and continue to utilize the low interest rates to bounce back quite healthily. I don't see the fact that while their profits and bonuses are up they have also done so with the help of layoffs as a plus do you?

Obviously, the value of homes and 401k's are way off and will possibly continue in that vein for years to come, certainly home value at least. The middle class has had great difficulty absorbing these losses when you add in the unemployment figures.

I know you won't agree but the Dems have made some slight progress on these fronts but more needs to be done. If that means people making over $250k have to pay a slight amount more in taxes I'm not going to cry a river over it. I don't see how anyone bemoaning the deficit can also claim that ending these tax cuts promotes anything other than adding to the deficit.

Every bit of job incentive and unemployment proposal now is being offset by the Dems in the form of lower welfare benefits, closing tax loopholes and the benefits of shipping jobs overseas. It's the best we can do in this environment and the only alternative from Republicans for job creation seems to be the opposite of what has been proven to work.

I linked a piece yesterday that during the Clinton years more than twice as many jobs in the small business sector were created than during the Bush years. It is my opinion that these tax cuts do not generate jobs period. I also linked another quote from the Brookings Institute of Tax Policy that only 1.9% of tax filers in the top two income brackets claimed any small business income.

It's disingenuous (I'm being kind here) of Republicans to claim that these higher tax rates will adversely affect small business job creation.

Posted by: lmsinca | September 14, 2010 4:57 PM | Report abuse

"It doesn't make a lot of sense to speak of "the wealthy" as a unitary thing."

It doesn't make a lot of sense to speak of "the unions" as a unitary thing.

Posted by: Ethan2010 | September 14, 2010 5:07 PM | Report abuse

"What prevents, oh say, Ethan, from getting rich?"

What's to say that I'm not?

I can't be both financially comfortable AND an advocate for the poor and Middle Class?

Btw, skip, I answered your questions on the benefits of stimulus funding on the other thread:

http://voices.washingtonpost.com/plum-line/2010/09/a_sixth_national_poll_shows_ma.html

Posted by: Ethan2010 | September 14, 2010 5:12 PM | Report abuse

lms:

"Wall Street firms and many of the big banks were bailed out via corporate welfare..."

This is simply untrue, at least in most instances. The TARP funds, at least with regards to the big Wall Street firms, were investments in the true sense of the word. It is simply false to characterize it as "welfare". The very fact that most big recipients (with notable exceptions) have paid it back, with interest, proves that it was not "welfare".

"...and continue to utilize the low interest rates to bounce back quite healthily."

Yes, this is true.

"I don't see the fact that while their profits and bonuses are up they have also done so with the help of layoffs as a plus do you?"

I'm not sure what layoffs you are referring to. If you are referring to Wall Street layoffs, well, I don't see such layoffs as a "good" thing, but rather as an unfortunately necessary thing.

"If that means people making over $250k have to pay a slight amount more in taxes I'm not going to cry a river over it."

My objection was not to the ending of taxcutsfortherich (although I certainly do object to it). The point I was making was that wbgonne's claim that wealth was transferred to "the rich" during 2008 is simply false. Wealth was destroyed, not "transferred". Most of "the rich" took a bigger hit in absolute terms than most people.

(Oh, and BTW...since "the rich" actually pay most of the taxes in the country, to whatever extent the TARP represented corporate welfare, it was "the rich" who are already paying for most of it.)

Posted by: ScottC3 | September 14, 2010 5:15 PM | Report abuse

Somebody said something about a 16% return on the Dow. I can't let that go by.

The Dow has rebounded about 60% from its low of 6600 in the week of 3/2/09 to today's level. You have to look at the big turning points of prices, not an arbitrary calendar year which doesn't mean anything.

So why does that week (3/09) mean something? Because that was the week when the final capitulation of sellers took place. The first dramatic selloff was during October 2008 when the sellers blew out in high volume. In March, they made a significant new low on smaller volume, which often signals a market turning point. And that is just what happened. The market made a "V" bottom and has turned up ever since.

From the low of 6600 to today's 10,500 or so is a dramatic turnaround and one of the best performing periods in stock market history. And the reason it turned around like that is because the U.S. and other world central banks did not abandon the financial markets. They pumped them full of liquidity.

Did that help shareholders who didn't get blown out of the market? You bet it did.

Posted by: 12BarBlues | September 14, 2010 5:20 PM | Report abuse

I can tell you one way the "rich" benefited from the market action in 2008-2009, although it happens every time there is extreme price action. The small investor is typically a scared and rather uninformed investor. He sells out when there is trouble and almost never spots a bottom to buy back in. He's usually has the mindset of a momentum investor and will wait until the market has gone up a LOT before he feels safe to get back into the water. Even now, the small investor is too scared to get back in and the Dow has recovered 60% and the NASD more.

More sophisticated investors, who are often wealthier and have professional money managers, don't have to sell out in a decline since they have lots of cushion. Since they have cushion, they can buy back at strategic turning points. That's not to say they will do so, but at least they have the financial wherewithal to do so if they have a value investor's viewpoint.

This phenomenon is so well known it has a maxim. It's called the "transfer of wealth from weak hands to strong hands".

Posted by: 12BarBlues | September 14, 2010 5:31 PM | Report abuse

"The point I was making was that wbgonne's claim that wealth was transferred to "the rich" during 2008 is simply false. Wealth was destroyed, not "transferred". "

Now you done drug me in again. Of course, I didn't say that at all. The transfer of wealth was well-advanced by the time the jig was up in 2008. Even then, however, the really plugged in -- the true Plutocrats -- they got their buttered bread just like always. So take a look at this (per BGin Chi) and see just who is getting screwed and who isn't getting screwed (and it doesn't depend on the definition of "is"):

http://www.rollingstone.com/politics/matt-taibbi/blogs/TaibbiData_May2010/203000/83512

Posted by: wbgonne | September 14, 2010 5:36 PM | Report abuse

Scott, both you and skip talk as if we only have two classes, the rich and the poor. I have always been firmly in the middle class, we work, pay taxes, invest in the market, send our children to college, buy homes, cars and other goods and services and most of us were devastated by the recession. Those of us with jobs are still working, paying taxes and all of the above but on a much smaller scale and we're the lucky ones.

Personally, I don't even know anyone who makes $250k per year, it's a very small percentage of the population. I'm sorry you object to the term corporate welfare, and maybe we have been paid back for the TARP funds, but there sure weren't any guarantees. Also, while the big guys survived for the most part, hundreds of small banks and investment firms didn't get that opportunity and if conservatives have their way neither will any other small businesses. Every single tax cut and investment opportunity for small businesses has had to be fought for tooth and nail by the Dems since 2009, so as a small business owner I know which side of the fence I'll fall on.

Putting more people back to work would also generate tax payer dollars although you don't seem to think the rest of us actually pay any taxes.

Also, your argument with wbgonne has nothing to do with my comments just to be clear.

Posted by: lmsinca | September 14, 2010 5:53 PM | Report abuse

still no answer to my very straightforward question. I've been asking it for weeks:
What are the moral and ethical underpinnings for progressive tax rates? What makes demanding more money from successful people right?

the liberals can't answer that, or they won't. But the sound is as of crickets chirping.

come now boys and girls, surely you have arguments ready about why hammering the most productive people among us is the moral and ethical thing to do.

Just trot them out. Certainly mother jones or NPR has armed you with talking points, right?

Oh and one other question: why is it that liberals NEVER talk about spending cuts? Hmmmm? Whenever there is a liberal whine-a-thon about the deficit it always about not confiscating enough from working people. Why do liberals never discuss unnecessary spending unless they are demanding that America bring its military budget to zero, like that makes sense or will solve the problem.

You guys just aren't thinking this through. I'm sensing panic here. Panic and a very lose grip on the moral and ethical values that made America great.

hardly shocking that.

Posted by: skipsailing28 | September 14, 2010 5:54 PM | Report abuse

What makes demanding more money from successful people right?
----------------------------------
Take it from a retired business owner. Because richer people can pay and poor people can't. That's why all retailers are looking to attract richer customers, not poorer ones. I don't know why you think that is a modern idea. It's as old as the hills and existed in the time of the founders for sure.

Other less practical reasons exist, but I'm pragmatic by nature.

Posted by: 12BarBlues | September 14, 2010 6:01 PM | Report abuse

"Because richer people can pay and poor people can't."

Can't argue with that.

Posted by: wbgonne | September 14, 2010 6:09 PM | Report abuse

@wb,

Some of the questions asked here on this blog sound to me like "why is the sky up there, and is that really fair?".

Posted by: 12BarBlues | September 14, 2010 6:11 PM | Report abuse

"What makes demanding more money from successful people right?"

Easy.

Quality of life improvements for the vast majority of America due to the social safety net.

It's really not a difficult concept to grasp. Even easier than the concept of investing in better toll booths (see http://voices.washingtonpost.com/plum-line/2010/09/a_sixth_national_poll_shows_ma.html)

Posted by: Ethan2010 | September 14, 2010 6:12 PM | Report abuse

All, Happy Hour Roundup posted:

http://voices.washingtonpost.com/plum-line/2010/09/happy_hour_roundup_87.html

Posted by: Greg Sargent | September 14, 2010 6:14 PM | Report abuse

skip, you have absolutely no clue what you're talking about. Several of us had discussions yesterday about spending cuts and we highlighted several measures taken by this administration to date, as well as others that could be taken that would also not further devastate the safety nets put in place, such as SS and Medicare.

And I have never heard one single person here or elsewhere advocate a defense budget of zero. Your exaggerations and innuendos regarding liberals are just that.

Most economists believe the middle class is both the engine and the consumer of the economy and believe it or not they pay taxes also. We'd like to see measures taken to restore the middle class and if one tiny part of that is not extending the tax cuts for those making over $250k so be it. I'd like to think we have more in our arsenal than just that as it's not enough to restore much, although it will at least not add even further to the deficit.

If you don't get many personal responses to your questions it's probably because most of us have recognized you are not someone who is really interested in debate. You're not alone though, we've picked up a few others. Feel free to carry on.

Posted by: lmsinca | September 14, 2010 6:15 PM | Report abuse

Scott,

Great catch on what I can only describe as the little fairy tale about the super rich (250k?) running off with all the money. Could not believe my eyes when I saw that claim. It seems literally to be nonsense.

Other reminders to lefties:

By definition, there is no such thing as borrowing to pay for tax cuts. Not taxing is not spending. (Think about it.)

Raising taxes does not foster growth or job creation and in no way is a necessary condition. You can't avoid that truth with language like "if that means the wealthy have to pay more
. . ." Those are weasel words.

If Obama were serious about deficits he would not be smashing all records for spending.

Posted by: quarterback1 | September 14, 2010 6:20 PM | Report abuse

@12BarBlues

"Some of the questions asked here on this blog sound to me like "why is the sky up there, and is that really fair?""

I swear that America in 2010 is like living Through the Looking Glass. Facts don't matter anymore. Everything is a matter of opinion. Bizarro World. I thought it would end with Obama's election but it's only become worse. I hope we are reaching a catharsis and that it won't be too violent.

Posted by: wbgonne | September 14, 2010 6:20 PM | Report abuse

@wbgonne,

As the economy picks up, and people work more, I'll predict that a lot of this craziness will diminish. There's something to be said about when people have too much time on their hands.

Posted by: 12BarBlues | September 14, 2010 6:32 PM | Report abuse

And everyone seems to auditioning for the part of The Mad Hatter.

Have a nice evening all, I have more catch up work to get done. Later.

Posted by: lmsinca | September 14, 2010 6:32 PM | Report abuse

The exchange above is a fine illustration of the problem with liberalism today. Questions of justice are treated as meaningless because liberals are unable to examine their own premises or apparently even to recognize them.

Question for 12bar and WB: what distinguishes your stated principle of justice from the bank robber's response that he robbed banks because that is where the money is?

Posted by: quarterback1 | September 14, 2010 6:37 PM | Report abuse

Who says it's a principle of justice? Since when are taxes just? They just are. As a society we find them a necessary evil. If you want justice, you should go somewhere other than the tax code. Try church.

Posted by: 12BarBlues | September 14, 2010 6:41 PM | Report abuse

This is interesting although I can't tell if they're talking about a separate tax bracket in addition to or instead of the rising bracket at $250K:

But now it seems that Democrats might propose a new compromise: A tax hike on millionaires, or a millionaire’s tax bracket.
TPM has confirmed the rumors with a House aide: “Some Democrats want to create a tax bracket for people earning $1 million and up, a shift that could give the party the rhetorical edge this fall.” (I will update as soon as I know who is proposing what.)

And there is some movement on the Senate side as well. Sen. Jim Webb’s (D-Va.) office confirmed to me that the senator, who previously said he does not support raising taxes for households making more than $250,000, might support raising taxes for households earning some larger amount. (His office did not have any more details than that.)

That means the millionaire’s tax bracket might get some traction. It is an issue that polls well — most Americans support letting taxes rise for the wealthiest two percent. And while some might argue a family making $250,000 a year is not “really rich” — really? — it is hard to argue millionaires can’t afford a slight hike in their top marginal rate.

http://washingtonindependent.com/97403/democrats-poised-to-propose-a-millionaires-tax-bracket

Posted by: cmccauley60 | September 14, 2010 6:50 PM | Report abuse

For crying out loud, the sound bites on this issue are easy: 10 years of Bush Tax Cuts for the Rich; $2.7Trillion added to the deficit; where are the jobs?

Bush Tax cuts for the rich create only one kind of job, a job for a finacial planner to hide the money.

If tax cuts create jobs, where are they?

If tax cuts stimulate the economy, how come we have this recession?

You could go on for hours.

Posted by: pblotto | September 14, 2010 6:56 PM | Report abuse

12BarBlues:

"Some of the questions asked here on this blog sound to me like "why is the sky up there, and is that really fair?"

...and:

"Who says it's a principle of justice? Since when are taxes just? They just are."

Each of these statements demonstrate a fundamental lack of understanding of the notions of justice and morality. Or they demonstrate a fundamental desire to avoid addressing the question.

Taxes are not, like the sky, part of the natural universe. They are the result of human choices and action. Hence, just like all human action resulting from choices made, they are subject to principles of justice and morality.

Certainly the very concept of taxation is subject to a moral analysis, but as a practical matter few people would argue that taxation in and of itself is necessarily unjust. So what is really relevant, and indeed unavoidable, (as it is with regard to any law) are considerations of justice with regard to both levels and methods of taxation in an ostensibly free society.

The question remains (and I think it is a good one)...on what principle of justice is a progressive taxation system founded, and (my addition) is such a principle reconcilable with a free society?

For what it is worth, in my view, the only truly just system of income taxation is a flat tax system.

Posted by: ScottC3 | September 14, 2010 7:24 PM | Report abuse

qb:

"Great catch on what I can only describe as the little fairy tale about the super rich (250k?) running off with all the money."

It occurred to me earlier today that if one were to write a book or a movie, and place into the mouths of a character what some people actually say here, the movie/book would be panned by critics for drawing such simplistic and unrealistic caricatures of so-called progressives.

Posted by: ScottC3 | September 14, 2010 7:32 PM | Report abuse

Well, Scott, if few people would argue about the justice of taxation as a whole, then we are just talking about the calculation, aren't we?

Well, when I had a lot of earned income, I favored a flat tax. When I had a lot of capital gain, then I favored capital gains preferences. When I ran an R&D company, then I favored R&D preferences. When I ran a manufacturing company, I favored heavy depreciation writeoffs. See any common threads through all that? Self interest. I refuse to call that justice--it's just self interest.

You can try to have a platonic discussion with someone about it, but it makes my eyes roll back into my head to call self interest something that it is not.

Posted by: 12BarBlues | September 14, 2010 7:34 PM | Report abuse

lms:

"Scott, both you and skip talk as if we only have two classes, the rich and the poor."

Well that's a bit, er, rich. The entire discussion here from the "progressive" side revolves around only 2 demographic groups - the "rich" and everyone else.

"Personally, I don't even know anyone who makes $250k per year, it's a very small percentage of the population."

If I made an argument about "the poor" and tried to bolster it by claiming that I didn't even know any poor people, would you find my thoughts on such people more or less convincing?

"I'm sorry you object to the term corporate welfare..."

I don't object to the term. I object to using to apply to things other than corporate welfare.

Must run. More in a couple hours.

Posted by: ScottC3 | September 14, 2010 7:45 PM | Report abuse

@qb and scott,

When someone here admits that their idea of just taxation is not one that serves them personally, then I'll be willing to take that person seriously. Until then, I don't.

I worked in venture capital for years and built companies when the capital gains preferences were advantageous. We created billions in wealth and thousands of jobs. Not once did we get involved with the morality of taxation. We just worried about what affected our business most, and that was capital gains. Not one of our employees worried about his personal taxation level, and not one of our execs worried about C-corp taxes. Morality of taxation is not a relevant principle to the building of companies, wealth and jobs. Philosophers can go off in their ivory towers and ponder such things, but I guarantee it that no one in the my field gave it a thought.

Posted by: 12BarBlues | September 14, 2010 7:47 PM | Report abuse

Why should the rich pay more?

Two simple reasons, really. First, they use more in terms of public resources - the courts, infrastructure, you name it.

Second, they have the most to lose from having a non-functional society. How rich would they be if the interstates fell to pieces and no one enforced the law protecting their property (both tangible and intangible)? A huge amount of federal, state, and local resources go into protecting property, and the top 2% own the lion's share of all of it.

Funny, I remember the days when conservatives used to like to lecture about how there is "no free lunch;" these days they consider it a birthright - but only if you can afford to pay for lunch anyway.

Posted by: JennOfArk | September 14, 2010 7:51 PM | Report abuse

12Bar:

"When someone here admits that their idea of just taxation is not one that serves them personally, then I'll be willing to take that person seriously."

I advocate a flat tax as a moral tax system. However, I do not advocate a particular flat percentage, so I could end up paying either more or less than I currently do.

"Morality of taxation is not a relevant principle to the building of companies, wealth and jobs."

True. It is, however, relevant to the setting of government policy. If venture capital firms were responsible for setting tax rates, then the morality of taxation would be relevant to them. If you are advocating a particular tax system to be enforced by law, then it is incumbent upon you to consider the moral implications of it.

The question still remains unanswered.

Posted by: ScottC3 | September 14, 2010 10:03 PM | Report abuse

Jenn:

Props for attempting to answer the question. However...

"First, they use more in terms of public resources - the courts, infrastructure, you name it."

What evidence do you have that this is remotely true?

"Second, they have the most to lose from having a non-functional society."

I doubt it. If society started to fall apart, the richer one was, the easier it would be to buy the services/protection privately that government currently provides. It is the poor that would be left entirely without any protections.

"Funny, I remember the days when conservatives used to like to lecture about how there is "no free lunch;" these days they consider it a birthright"

What an utterly bizarre thing to say. It suggests that you haven't the slightest idea what a "free lunch" refers to.

Posted by: ScottC3 | September 14, 2010 10:28 PM | Report abuse

Well, I don't know whether this thread is dead, but the comments above are interesting.

"Who says it's a principle of justice? Since when are taxes just? They just are. As a society we find them a necessary evil. If you want justice, you should go somewhere other than the tax code. Try church."

I'm a bit astonished at 12bb's position that tax structures do not implicate matters of justice or morality, if that is what he is saying, as it appears. The question is not whether business people consider tax fairness in running their businesses; of course the don't. They are just trying to earn profit under whatever taxes are imposed. The question is, as Scott notes, what tax policy should be.

But I am also struck by what seems to be 12bb's suggestion here that taxes are inherently unjust or perhaps outside the realm of justice. I can't think of another time I've seen that view expressed by anyone on any side.

"You can try to have a platonic discussion with someone about it, but it makes my eyes roll back into my head to call self interest something that it is not."

12bb, do you seriously believe that what everyone says about tax policy is whatever is in his or her self interest? Is this a general belief of yours that all people act at all times only in their self interest, whether or not they try to call it morality or justice?

I can tell you that I've had the same positions on taxes and economic policy since I was a young man, broke, unemployed, uneducated, without an apparent future. Thirty years later, I have a high income (although am by no means "rich"), and have the same views. I believed in a low, flat tax then as now.

Like Scott, I believe a just income tax should be flat. I recognize that a rational argument can be made for progressivity, but one of the problems is that once you advocate progressivity, there is no principled way to say what the structure should be. How much "more" is just?

Which leads back to my original question. How is the simple assertion that we take from the rich because they "can pay" and the poor "can't" different from the statement attributed to Willie Sutton, iirc? I don't believe it is.

Posted by: quarterback1 | September 14, 2010 11:09 PM | Report abuse

@scott and qb,

Hope you see this. I'll take both you guys at your word that your attitude about taxation has nothing to do with what you personally pay. The two of you should debate it then, because my view is definitely coloured by what I pay. And everyone else I ever met in business was the same. Self interest is the most American of traits.

Posted by: 12BarBlues | September 14, 2010 11:23 PM | Report abuse

Jenn said:

"First, they use more in terms of public resources - the courts, infrastructure, you name it."

As Scott asks, what evidence? I think we discussed this once before. Jenn said the rich disproportionately benefit from the Patent Office. This is a misguided claim for many reasons, including the facts that the very purpose of the Patent Office is to encourage innovation and economic growth that benefits everyone, that patent applicants pay user fees, and that most patent applicants probably are not rich.

Morever, it is a fact that the highest earners pay the vast majority of taxes already. There is a much stronger argument that it is the lower classes who use government resources greater than what they contribute.

"Second, they have the most to lose from having a non-functional society. How rich would they be if the interstates fell to pieces and no one enforced the law protecting their property (both tangible and intangible)? A huge amount of federal, state, and local resources go into protecting property, and the top 2% own the lion's share of all of it."

I find this statement fascinating for its moral implications. I completely agree with Scott as to its factual soundness. The rich could buy guns and security and private armies. That's how much of human history went.

Indeed, this argument casts government merely as a security arrangment of the rich against the threat of expropriation by the non-rich. If we are assuming that the theft of their property would be unjust, then Jenn is in effect saying that the burden of government is necessary because of the threat of invasion of property rights by the "poor," which would seem to cut against any claim that those needing the protection should bear the burden rather than those who pose the threat. This theory seems to lack coherence.

Posted by: quarterback1 | September 14, 2010 11:32 PM | Report abuse

"The two of you should debate it then, because my view is definitely coloured by what I pay."

Scott and I wouldn't have much to debate on this, because we agree.

I definitely feel what I consider the injustice of confiscatory taxes in a personal way I didn't when I was at the bottom of the scale, but I had exactly the same position. In fact, in one job (paying just above minimum) I had when I was young, I was sometimes sent to deliver papers etc. to and from the owner and other business associates of his. I can recall for example going through the servant's entrance into one spectacular mansion with a papers to deliver and sitting waiting in the back kitchen for them to be returned.

I marvelled at it all and thought, how do people build this kind of wealth, but I had exactly the same position then on taxes that I do now. I thought the right thing would be for everyone to pay the same rate. I think a lot of people are able to set aside self interest in assessing what justice requires. Everyone is fallible and subject to temptation. But self interest isn't determinative for everyone.

Posted by: quarterback1 | September 14, 2010 11:44 PM | Report abuse

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