Obama should let the Bush tax cuts become as forgotten as whatever passes for a 2002-vintage dance craze or fashion fad. The president should seize the election-year initiative by laying out those tax cuts he favors and putting his brand on them.
From now until November, Obama shouldn't let a day go by in which he tells Americans, "Democrats have a plan to cut your taxes."
Let the GOP scream and sputter. Every time they do, and each time the Republicans complain that the rich aren't getting their extra cut, Obama and his Democratic friends simply can call the Republicans' deficit bluff and explain — rightly — that those tax cuts for the richest Americans are just a luxury we can't afford right now.
Data indicates that this is an area ripe for Democrats to define public opinion and win voters.
Polls indicate that twice as many voters still blame Bush for the poor economy as blame Obama. A majority also happen to agree with the president that the tax cuts for those making $250,000 or more a year should be allowed to expire.
A recent Ipsos/Reuters poll found Americans would rather reduce the deficit instead of lower taxes by a margin of 54 percent to 43 percent. By promoting his own "Obama tax cuts," the president could appear to satisfy both by lowering taxes in a fiscally responsible way.
Most importantly, though, a Democratic tax-cut plan gets Obama and the Democrats off defense, puts them on offense — and simply steals Republican thunder when Democrats need to steal it the most.
Article comments
— go to most recent comments1 - Dave Nalle
I think this horse has already left the barn. The idea of Democrats getting any credit for lowering a deficit they blew up to three times where Bush put it is laughable, and they certainly aren't inclined to lower taxes. They've already passed massive new taxes on those who can least afford it through the healthcare bill and are planning more with cap and trade. They should avoid the tax issue like the plague, because the damage they are going to do to working Americans pales in comparison to any small tax benefits which Bush gave the so-called rich.
Dave
2 - jeannie danna
I agree with you Scott.
End the Bush Tax cuts for the wealthiest Americans and go back to Clinton era tax cuts this gives the middle class and small businesses a chance to survive.
:D Dave, *so-called* rich. yes, that's what they are called.
3 - handyguy
They can't "avoid the tax issue," with the impending expiration of the Bush cuts.
David Leonhardt, the NY Times' indispensable economics columnist, this morning proposed a temporary payroll tax holiday [for all employers/workers] as an excellent accompaniment to a partial repeal of the Bush cuts [for incomes below $250,000].
Leonhardt: Tax Cuts That Make a Difference
The reasons Republicans give for wanting to keep all the tax cuts are bogus. Only 3% of small business owners are in the top tax brackets. And small business owners' personal income tax marginal rates are not even close to being the biggest factor in whether they will hire [or lay off] people.
And the wealthy are more likely to save than spend their tax-cut money.
Deficit hawks who support extending the tax cuts are self-contradicting partisans who care more about winning elections than helping the economy.
4 - Scott Nance
Dave, while your comment reflects conventional conservative wisdom, data indicate that together with the economic downturn, the Bush tax cuts and the wars in Afghanistan and Iraq explain virtually the entire deficit over the next 10 years.
5 - roger nowosielski
You're being polite, Scott. We've come to a point where it's beyond deficit anymore.
How come there is no mention here of Wall Street abuses, of Ponzi schemes, of real estate and financial bubbles, of taking the American people to the cleaners?
I should think that any intelligent discussion of the economic and moral crisis which faces us would take any or all of those factors into consideration.
But no. you decide instead to discuss these thorny matters on a gentenmanly basis, as though you both were a member of the same country club, taking therefore extreme precautions lest you offend one another.
How pathetic!
6 - Realist
As important as this is, Scott, the bigger issue is putting people back to work so that they can PAY taxes. Obama has failed miserably in this (despite the saved jobs for which he does deserve credit), and there really isn't time anymore to reclaim unemployed voters with new jobs. The GOP will block any such effort with the election so close.
As much as I hate to see it, Obama is going to really learn what bipartisanship means to Republicans as they make him dance to their tune after November. He just might rue the day he decided not to use the powerful majority he was given by the voters who now cast him overboard for failing them.
7 - Dave Nalle
More important than preserving the Bush income tax cuts would be substantial reductions (or elimination) of Capital Gains, Inheritance and business taxes. Those are the ones which would really stimulate investment and thus job creation.
Dave
8 - Cindy
Dave,
You are unbelievable.
No amount of evidence will sway you. You are the most indoctrinated person I have ever met.
9 - zingzing
this is how the rich get richer and the poor stay poor. someone gets a pool in their backyard and decides it's ok to shit on everyone else.
10 - handyguy
Either the deficit matters or it doesn't. You pull that much revenue out of the budget, what do you think will happen?
11 - Arch Conservative
It's too little too late for the Dems. Every day for the past week at least 3-4 economists, political pundits or academics are coming out and stating they believe the GOP is going to at a minimum win the House. I doubt they'd be doing this if they weren't pretty confident that it would actually happen.
Taxes schmaxes.........the leviathan federal government and the entitlement mentality may have already driven us past the point of no return as a nation. The only question remaining is how many generations will it actually take before the average American's life turns into a scene from an apocalyptic film where his day is spent searching for food and water for his family.
12 - jeannie danna
Realist,
the bigger issue is putting people back to work so that they can PAY taxes.
That's a good point, but You think Obama failed to be bi-partisan and help this country to prosper?
The GOP will be blamed; that's who have failed this country miserably since, Obama was elected and for the last thirty-plus years!
taking care of theirs and theirs alone...
13 - jeannie danna
Arch,
The only question remaining is how many generations will it actually take before the average American's life turns into a scene from an apocalyptic film where his day is spent searching for food and water for his family.
You'll be searching really soon if you don't start paying TAXES. and you call me a moon-bat?
14 - Bruce
I find it ludicrous that journalists and pundits talk about "tax cuts" and "tax breaks" like the government is giving away money to rich people. It is our money! We earned it. How exactly has our government shown that they know better what to do with my money than I do? No - I'm not in the top tax bracket - so I'm not one of the so-called rich. But I'm an American - and I have earned everything that I have by my own hard work. That is the American way - not a class of people who believe that the government "owes" them. The government doesn't earn money - when it gives it away it takes it from someone who does.
15 - jeannie danna
Bruce,
Are you a member of the top 1%? If you are, should this country borrow money to give you an east out?
It's not all your money.
16 - jeannie danna
Backwoods sense? Backwards would be a better term.
17 - Glenn Contrarian
Bruce -
After WWII, our national debt was higher in relation to our GDP than it is now...and we very nearly paid it off!
How did we do that?
Republicans AND Democrats instituted a top marginal tax rate of 80+ percent from the end of WWII until Reagan took office - and in the eight years of Truman's second term and Eisenhower's term, it was over 90%.
How many disastrous economic upheavals did we have during that time? None.
How many have we had since Reaganomics took hold? Four.
If high taxes ruin a nation, then explain why the rich kept getting richer all through that time, and explain why we did NOT have a second Depression during that time!
18 - roger nowosielski
Bruce,
Judging by your website, you are a pundit in your own right, so don't be disparaging the profession to which you properly belong.
But I have a better suggestion for you. Why don't you take all you're money and move to some backwoods where there is no civilization of any kind, no amenities to speak of, none of the trimmings and the accoutrements which come part and parcel with any civil society and yes, the government too.
Enjoy your money and have a great time.
19 - roger nowosielski
Actually, I enjoyed your article, Bruce, on Obama, the middle class, and Huffington Post. There a many points with which I agree, and I'll post my response shortly.
20 - Dave Nalle
No amount of evidence will sway you. You are the most indoctrinated person I have ever met.
Cindy, when you write "indoctrinated" I read "informed."
Dave
21 - roger nowosielski
She just doesn't know how to make a dent with you, Dave.
BTW, I read the conservative road-map to economic recovery you referenced earlier. I will post my response soon.
22 - John Wilson
Nalle is quite wrong: pouring more money into the hands of the rich and powerful will not improve our economy and jobs. They already have more capital than they know what to do with, and making more just idles more resource.
A cursory examination of economics perio9dicals like FT and The Economist reveals that the USA has massive excess capital already. Even ordinary business periodicals complain about the excess over-capacity and idle capital. Even driving around your own metropolitan community will reveal large office and factory tracts that are dark and uninhabited.
One of the biggest problems of the last 30 years of capital-favoring economic policy has been that the capital end has simply had too much money forced on it by indulgent policies while the labor and wages end has been starved.
To continue favoring capital investment over wages is to continue a swing that should be countered.
23 - Cindy
22 Dave,
Consider what John Wilson says there.
Currently I am seeing the news spokesmodels saying that business is flush with money but not spending any. They are just waiting for the consumer to 'gain confidence' and start spending again.
Hello! 'The consumer' is out of dough. It's no longer about 'confidence'. The consumer was out of money awhile back and business was happy to lend money for continued spending. That didn't work very well. What kind of fairytale is this?
Why do businesses need more incentive when they already have most of the money?
24 - handyguy
It's just the way businesses operate. They need to have confidence that they can actually sell more goods and services before they hire employees to produce same.
That's why most recent recoveries have been tentative. Vicious cycle: cautious consumers, cautious businesses.
The Times's Leonhardt seems to think a temporary payroll tax break will help. But he cautions:
...no temporary tax cut will solve the economy’s long-run problems. That’s a harder project, one that involves
upgrading the skills of the work force,
slowing the growth of health costs,
reducing the deficit,
lifting exports,
restarting healthy wage growth
and, yes, simplifying the tax code.
25 - roger nowosielski
Good point, John (#22). My hunch is they're hoarding it, anticipating a major upheaval or two, thinking that to invest in these uncertain times would be to risk it all.
Have you noticed how some services and and industries decided to charge steeper prices, again, almost in anticipation that the going ain't going to be good for very much longer. The same syndrome.
Indeed, when worst comes to worst, they shall all probably retire in the Cayman Islands, or in Switzerland, and live happilly ever after. Or they'll just bid their time until the feel is safe for them ro resurface.
A colony on the moon is not such a remote possibility. In fact, the more I think about it, the more I like it. Let's all dispacth them with haste.