White House on 2012 tax cut debate: bring it on
If President Obama's deal with Republicans on the Bush tax cuts holds, the extension of current tax rates will expire in 2012. Choosing to extend the cuts for two years, I suppose, is defensible on policy grounds -- it's long enough to last through what, with luck, will be a steady recovery; keeping them longer would harm the budget just that much more. But, of course, that timing will also force Congress and President Obama to battle again over those tax cuts in the middle of a presidential election year. And it sounds like this was intentional.
The White House's official line: Bring it on. Obama won't extend the cuts for high-income earners "one more day" beyond two years, a senior White House official insisted Monday night. "We expect that this will become a central piece of the debate" in the 2012 race, the official said, arguing that Obama made his case on the cuts in 2008 and is ready to do it again in 2012. This is telling for the year the official left out -- 2010. About that, the White House explains to ABC News that the president wanted a bigger fight this year, but congressional Democrats "wouldn't throw a punch." This rhetoric from the White House is probably supposed to encourage liberals upset at what they see as Obama's lengthening history of capitulation to Republicans: Next time, our necks will be on the line, too, and we'll make the case better, stronger.
And conservatives? Fresh off what they feel -- with some reason -- is a victory on this issue, they appear eager to engage in another round over the Bush tax cuts. So who's right?
Obama should be. If there's an issue with which to define the president's reelection bid, this isn't a terrible choice. Polls show majority support for the president's position on the Bush tax cuts. Support for that stance may only increase as Americans get more concerned about the federal debt. And it's a lot easier to effectively communicate a policy message in a presidential election -- in which you have a single, recognizable, high-profile leader who controls the messaging -- as opposed to a midterm election, in which that responsibility is dispersed and lots of Americans simply aren't paying attention, anyway.
Of course, much of the logic above indicates that this issue should have worked to the Democrats' advantage this election year, too. If voters don't feel the economic recovery in two years, it will provide a negative context for Obama's 2012 campaign, no matter how favorable Americans may claim they are to his particular policy goals. That, in turn, could lead to a disaster for liberals: The president, facing a tough reelection bid and continued difficulty in effectively advertising his policy preferences, strikes another deal to keep taxes from going up across the board in a shaky economy, a situation he's forced into because the lousy economy buoys the GOP, even if Republicans' stance on the Bush tax cuts isn't popular. On the other hand, if confidence in the president's economic management recovers by 2012, he will have an easier time harnessing the political value of his position on the Bush cuts and blaming the GOP for intransigence on the issue.
As ever, the state of the economy is the critical variable.
| December 7, 2010; 1:16 PM ET
Categories: Stromberg | Tags: Stephen Stromberg
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