Dearly beloved, we are gathered here today to ask: Why, in the name of God and all that is holy, are the Democrats refusing to even hold a vote on the middle class Bush tax cuts? I can see not a single political or policy advantage to punting on this issue. Coming hot on the heels of failing to get "Don’t Ask, Don’t Tell" repealed and/or passing the DREAM Act (which, as a reminder, would offer citizenship to young illegals who serve in the military or complete two years of college), this latest display of curling into the fetal position and crossing their fingers in hopes that the Republicans stop kicking them in the face (it’s a party tradition!) is just one more way that the Democrats are alienating their base and ceding the rhetorical (and electoral) ground to the GOP.
First, a little background: If you open your hymnals to page 2001, you will remember that President Bush, freshly elected with a big fat budget surplus on his hands, decided to give the American people a big fat tax cut. Now, because the GOP didn’t have the 60 seats necessary to break the inevitable Democratic filibuster, they passed it through Reconciliation. Those of you playing along at home may recall that the GOP spend the better part of the Winter/Spring of 2010 hollering about how Reconciliation, which was used to pass an amendment package to the Affordable Care Act (you might know it as "Obamacare" or "Teh Deth Panulz!!!!!" or whatever), was literally a threat to the very fabric of Democracy, but back in 2001 it was all kosher with them. As a provision of that process, those tax cuts, which were across-the-board drops in income tax rates, were set to expire after ten years.
Well, my friends, the day has come: the Bush Tax Cuts are about to expire, and income tax rates are set to rise automatically. More precisely, the day is coming and will be here on January 1, 2011. Now, it’s generally both bad politics and policy to let rates go up in the middle of a down economy, so Republicans and Democrats have both jumped on the bandwagon of making the cuts permanent. Well, at least they both have as far as the middle-class portions of the cut are concerned, which affect 98% of the American people. The conflict, as it usually does, comes over the remaining 2%, specifically earners making over $250,000 a year. President Obama and the Democrats want to let the marginal tax rate on those earners go from 36% to the Clinton era 39%, which would still be lower than rates on that bracket for any year of the Reagan Administration. Extending these cuts would grow the deficit by $700B (oh yes, B) over the next 10 years, but Republicans, who typically spend their time hollering about the ballooning deficit, seem to either not notice or not care.
The Republican argument is that raising taxes on ANY Americans (nevermind that it is not an increase but an expected expiration of a temporary cut) in a down economy is a bad idea, especially the wealthier among us, because they are in positions to hire and spend lots and lots of money, thereby keeping our economic engine running. From my standpoint, this logic isn’t applicable to the situation. First of all, wealthy Americans tend not to spend that money; they save or invest it. Moreover, we’re talking about personal income, not corporate income. If you are making millions of dollars a year and don’t want to give $30K to some guy down in sales, that isn’t Barack Obama’s fault. It is certainly your prerogative to do so, but you can’t blame that on a perfectly reasonable tax rate. Let me boil that down further: extending the Bush Tax Cut on the top 2% of earners will NOT put money into the economy, it will NOT encourage hiring, and it will significantly increase the deficit.
The winning strategy for Dems would be to hold a vote on just the middle class tax cuts. It leaves the top 2% out of the picture for the time being and puts forth a bill that’s tough for Republicans to vote against (good luck explaining that one to your constituents), and it sets them up to handle the top tax rates separately where they can be more effectively handled. But that’s not what they’re doing. For some reason, they’re punting the issue, refusing to even bring those up for a vote. It’s as if they think that neglecting to do what Republicans tell them not to do will inspire the GOP to stop bludgeoning them. Now if (aw, screw it, "when") the GOP takes back the House (but probably not the Senate, thanks to the Crazy Delaware Anti-Masturbation Witch, aka Christine O’Donnell), they’re going to pass ALL of the tax cut extensions, say "the Democrats didn’t try to extend the cuts for anyone, but oh look, we did it for everyone," and then President Obama is going to find this bill sitting on his desk ready to throw some more deficit fuel on the fire for a tax cut that won’t stimulate , and there is no way in hell he’s going to be able to justify busting out his veto pen.
This is stupid. Stupid, stupid, stupid. Can the Democrats give us, oh, what’s the phrase . . . ah, yes: a reason to vote for them?