Only morons think Obama caved in his negotiations over the Bush tax cuts in 2010. I thank David Corn for setting the record straight, but it really wouldn’t be necessary if there weren’t a bunch of progressives running around who are addicted to poutrage and who have no understanding of how Washington DC works. Not only did Obama get a stimulus bill out of the deal (extending unemployment insurance, a payroll tax cut, and a child tax credit), he got renewable energy credits, the repeal of Don’t Ask, Don’t Tell and the ratification of the New START Treaty with Russia. Without that stimulus, Obama may very well have lost his bid for reelection due to a bad economy, and letting the Bush tax cuts lapse (even for only the top 2 percent) in the midst of a massive recession wasn’t going to help the economy in the short term. Part of the progressive argument on taxation is about fairness, but it’s also about sound policy. You should raise and cut taxes at different times based on the current condition of the economy. Cutting tax rates is one of the few ways the federal government can help a struggling economy. That’s precisely why taxes should not be cut when the economy is doing well. Taxes should be raised when the economy is doing well, and the added revenue should be used to pay down the debt incurred during bad economic times. Related to this, new investments are best made when interest rates are low.
About The Author
BooMan
Martin Longman a contributing editor at the Washington Monthly. He is also the founder of Booman Tribune and Progress Pond. He has a degree in philosophy from Western Michigan University.
Oh, gee golly whiz, Booman!!!! Poutrage and Progressive in the SAME sentence.
To bad, the “progressives” you’re speaking of are actually liberals.
Besides, what’s in a name?
http://www.boomantribune.com/hotlist/add/2012/11/24/18388/428/main//
I love how now that the election is over Boo feels the need to prove his “centrist” cred.
I suspect Obama feels that need also. Somehow I get the feeling tax cuts for the top are here to stay. But the tax cuts for the middle? Gone. And SSS and Medicare, Medicaid ‘reform’ will be needed because……well shut up! And Boo will defend the deal. Why? Because the WH, in a conference call, told him everybody must sacrifice. Particularly the takers.
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That’s quite a crystal ball you have there. If I were you, I’d trade it in. It seems to be infecting you with nasty “suspicions” and “feelings”. Better to wait and see what actually happens before you get exercised about how terrible a deal the WH is making.
You go forty straight years of being sold out, and then get back to me. The middle class is being destroyed in this country, and all you get is millionaires on TV explaining what’s good for poor people. Did you read the link Booman provided? Summers and Axelrod arguing to keep all tax cuts. I’m sure it’s just a coincidence that they saved tens of thousands of dollars in the deal. Congressmen telling Reid they ‘won’t vote for a bill that lowers taxes on only the middle class’.
What a shock.
I’m cynical because I have reason to be.
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“You go forty straight years of being sold out”
I’ve gone a decade or two longer than that and I’ve learned a few things. One is that cynics are rarely disappointed. Another is that sometimes, they are wrong. I like to keep an open mind until I know the facts. If the 1% keep their tax cut there better be a good reason, at least as good as there was in the last negotiation. If not, I’ll be out on the streets yelling for blood right beside you. We’ll see.
really? man, I don’t agree with this at all. I think that Mr. Booman’s analysis is SPOT ON.
I was one of those outraged people back when the Bush tax cuts were extended for a year. Blogged about it extensively, bitched and complained, etc. And then i began to realize what Obama had gotten in return: the payroll tax cut, the child tax credit, and (not for nothing) the unemployment extension that I really needed at the time.
The 2012 election results are VERY different than 2010. The Democrats and the President have a lot more leverage.
If there is one thing I have learned over the past 4 years, it’s that Mr. Obama is a very clever man. I disagree with him strongly on civil liberties, drones, and that awful kill list: those are shameful policies. But I’m feeling pretty good about the fate of the Bush tax cuts.
I’d also agree with Booman that anyone who thinks he caved doesn’t understand how DC works. that misunderstanding is one of the reasons I’ve become a stronger supporter of the president than I have been in the past.
Tax cuts for the 2% are going up. If you think the president is backing down on that one, you’re crazy. If there is one thing that the President has stood for in the last 18 months, that’s it.
I love how now that the election is over Boo feels the need to prove his “centrist” cred.
…by linking to Mother Jones.
I just can’t agree with that. I don’t believe that “caving” is the right word, but it was a strategic miscalculation of enormous proportions and based on right-wing understanding of how an economy works when there were plenty of high-level, progressive economists, such as Krugman and Brad deLong as well as Schiller of Case-Schiller Housing Index fame, who were telling him to do the opposite at the time and who had his back covered.
Raising taxes, mostly on the rich, made sense because the rich aren’t using their money to invest in the economy anyway. Their hoarding it in cash or investing overseas, so the impact on economic growth would have been negligible or even positive, although there would be the risk of the loss of unemployment benefits for some unemployed workers (which is the excuse Obama gave at the time for not letting them expire).
Not only that, but it would have provided the Obama administration with a much stronger bargaining position regarding budget and debt negotiations, which would have eliminated the uncertainty among investors regarding whether or not to start or expand business operations in the US that has been a drag on economic growth since that time.
It wasn’t until Occupy got going that the Obama administration decided it had enough support among its base to take a more adversarial stance with the GOP negotiators, and that is when Obama’s luck started to change regarding economic policy.
Not sure I agree with this. You’re concentrating on the ‘rich’ tax cuts. But Obama had to try to get at least some type of stimulus to the middle class. Tax cuts were the only stimulus that were politically viable. Limited value, true, but at least it was something. And even Krugman admits it helped us from cratering. Krugman’s disagreement is ‘too small, not enough’ and ‘fight for it and see what happens’. Fair enough.
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It would have lasted only a couple of months until the Republicans came back to negotiate for the best deal they could get with a weaker hand, and the tax impacts would have been minimal any since most people didn’t notice them in their paychecks in the first place if you weren’t making over $100K. And those that do make more than that are savers, not spenders, with additional income, so it would have had minimal effect on increasing net transactions in the economy (GDP).
It would have lasted only a couple of months until the Republicans came back to negotiate for the best deal they could get with a weaker hand
Where “weaker hand” is defined as “gaining control of the House, while increasing their Senate majority well above the 40 needed for a filibuster.”
There is a reason why this deal was cut in the lame duck session.
‘Fight for it and see what happens’ is a strategy for political morons. I include Krugman in that category. He’s a great economist, but a political moron.
If you fight a battle you are sure to lose, and you lose, you are a loser. The country does not like losers. This applies to all the battles the wild eyed left wanted Obama to fight. In every case so far he knew, better than they, exactly how far he could push and still win.
Just what the hell is so wildeyed about Social Security and medicare being off the table?
Nothing in principle, If you can win something good with that negotiating stance. I would add, two things,however: 1) if negotiations blow up and nothing is accomplished between now and year-end, there will probably be damage– some damage to the economy, and to the presidents standing. How much is hard to say. 2) medicare costs are skyrocketing and something does need to be done about them, long term. So I think there are benefits to getting a well-crafted deal through before the end of the year. There are also some benefits to waiting until the bush tax cuts expire before making a deal. I have confidence that the president’s team will do a good job in deciding whether to take a deal now, or waiting until the new year. This confidence is based on the way they have continually tied the repubs in knots over the last 4 years.
You’re right that the stimulative effect of keeping tax rates low on the top 2% was negligible. But the way you dismiss the extension of unemployment benefits is disgraceful. Both as a humanitarian effort and as much-needed and extremely effective stimulus, the unemployment benefits were crucial.
Also, he was able to get the lame duck Congress to pass a nuclear disarmament treaty, the end of Don’t Ask, Don’t Tell, the 9/11 worker compensation act, and the Food Safety Act.
All of that was imperiled or blocked at the time.
To call that a miscalculation is ridiculous. It was a stroke of genius that probably saved his presidency.
Unemployment benefits would have been forthcoming, along with tax cuts for the middle class and a little bit for the rich, if the GOP had had to deal from a weaker hand, post Bush expiration. Obama has been making these kind of “disgraceful” gambles throughout his administration as any president does. He was wrong to do what he did, and that’s why Krugman and others are just as disgraceful as me in this respect. It did way more harm to more people than what would have happened, and I think (hope) Obama knows this now since so many economists have pointed this out since then.
Agreed. But,
“I thank David Corn for setting the record straight, but it really wouldn’t be necessary if there weren’t a bunch of progressives running around who are addicted to poutrage and who have no understanding of how Washington DC works.”
I’m pretty sure they’d continue the poutrage even if in their hearts they felt like it was a good deal and the best course of action at the time. I think they see all this poutrage as some sort of necessary counterweight to the right wing, even if it’s ultimately self-defeating.
But there are probably others that honestly gravitate to any manufactured narrative that makes Obama look weak, and it’s lucrative for people in the LW blogosphere to meet that market by giving them what they want.
Finally, I think there is also a contingent that is so priveldges and insulated they don’t even consider what Obama got out of the deal for regular people because the principle, to them, is more important than the outcome. It’s all just a game to them. You see this all the time, the folks who would rather burn the village than save it, just to make a point.
I meant I agreed with Boo.
Agreed. For me:
Pressure from the left on Obama is GOOD.
Hyper-cynical declarations meant to erode the president’s long-term support, BAD.
The difference to me is between people like Krugman – who I think has constructively criticized the president, only rarely going truly defeatist – and people like Glenn Greenwald and a few others who came out basically calling the president an evil monster in not so many words.
What I look for is hyperbole, emotional appeals, and ad hominem attacks on the president’s character. I also look to see if the writer/speaker fails to identify realistic alternative paths that don’t require a constitutional convention. If all the person is doing is saying “policy X is the worst EVER and Obama’s support betrays is REAL AGENDA” and they’re not saying “Here’s what can be done right now, without use of a time machine or a Harry Potter wand, to get us closer to this goal” then I have really no time to listen to them.
Agreed.
I’m also looking to see who will promote this project, and urge people to get involved, vs constant whining and complaining that just feeds cynicism and powerlessness:
http://www.theaction.org/#about
a nuclear disarmament treaty, the end of Don’t Ask, Don’t Tell, the 9/11 worker compensation act, and the Food Safety Act
All of which were major progressive causes before they passed, resulting in some cases in furious anti-Obama protests at the White House by progressives who were furious that their bill hadn’t been passed, right up until Obama actually did get them passed, at which point they completely ceased to matter to the people who’d spent the previous two years putting them at the top of their “I didn’t get my pony!” lists.
Reason #29384743987 why firebagger = teabagger.
Arguing over what happened in 2010 is not going predict what is going to happen this year.
It is now, what, 35 days from the automatic expiration of the tax cuts and the automatic sequester of 8% of non-entitlement, discretionary expenditures, that exempts a sequester of military pay.
I think the clock is going to run out regardless of the intentions of either side. That is good for the Democratic political position.
Exit polls in the election showed that folks were willing to sacrifice the middle class tax cut to deal with the deficit. (If only the rich were so public-spirited!)
Cuts actually in effect manifest to people who receive those particular benefits the fact that the government is contributing something to their lives.
It is two years past time to hang up the obot-firebagger flame war.
And exactly the right time to watch what Democrats in Congress are doing, because what you see in the next four months is what you’ll see until 2014. And will shape the public perception of the new Congress.
As for the timing of tax increases and tax cuts, the appropriate way to manage that would be legislated stabilizers that kick in when certain economic conditions occur.
The structural issues in the tax code and the foundation of income that it provides for tax accountants and lawyers is the major issue that should, but will not adequately, be addressed. Capping deductions is well worth a try as long as the legislative language is simple and the level of the cap misses 90% of taxpayers.
Finally, probably the biggest accomplishment of the “surrender of 2010” was the ratification of the New START Treaty with Russia. It an future US-Russia arms reduction agreements provide legitimacy to the US’s assertion that it is interested in a nuclear-free world instead of creating a nuclear weapons exception for itself. At some point in the non-proliferation negotiations Israel will have to come clean, and India and Pakistan and North Korea will have to sign on to reductions.
I think the clock is going to run out regardless of the intentions of either side. That is good for the Democratic political position.
Also, on an individual level, it is good for Blue Dogs and Republicans. The expiration of the Bush tax cuts allows them to post as tax cutters, even voting for a tax cut in the next session, while still having the tax increases on the rich go through. They can get that additional revenue that they deep down know we need to get, without having their fingerprints on a tax hike.
To quote Willy Wonka: “No. Don’t. Stop.”
Also, Obama got a complete overhaul of our food safety laws done in that same lame duck session. This always fails to get mentioned and I think it was one of the best things he’s done so far.
And the 9/11 responders bill.
As a “moron” who was bitterly disappointed with Obama’s first term (yes, of course I voted against R&R), I have to take exception to your and Corn’s revisionist history. I will admit that the democratic senators were significantly worse, but the buck stops with Obama. He had hired Emanuel and Summers before he even took office. Look, if the long lines in Florida prove voter suppression, the appointment of those two morons (now that’s the correct use of the word) proves Obama’s intention to hand his mandate to the 1% on a silver platter. The Obama who barnstormed the country in 2012 should have started – as soon as it became clear that McCain was toast (September if not sooner) – to be fiercely populist. There was NO EXCUSE for him to deep six the stimulus, thumb his nose at Krugman, and fail to implement all of the proven-right-after-the-fact advice of progressive economists. Obama’s defamation of that community was as tragically comic as the right’s defamation of the climate change scientists and evolutionists. And there was NO EXCUSE for not have health care reform – with a public option – ready to railroad through Congress by February 1, 2009. To let Feinstein, Baucus and the rest of those crooked bastards sabotage his momentum was truly pathetic.
I’m not saying that Obama will cave again this time but he sure as HELL caved last time – from the first stimulus to the debt charade debacle. Let’s not rewrite history. We dodged a nasty bullet in Romney and Ryan, and Obama 2.0 will hopefully have less bugs, but don’t get too drunk on that Kool-Aid.
“And there was NO EXCUSE for not have health care reform – with a public option – ready to railroad through Congress by February 1, 2009”
Do you think any of the unicorn ponies that the left wanted were actually within reach, even when we “had” 60 senators, which included several blue dogs who were completely against any of those ponies? Public option? Factor of two larger stimulus? The votes clearly WERE NOT THERE, or Obama would have pushed for them. Do you think you can count Senate votes better than Rahm Emmanuel? If so, you really are a moron.
You know, one of the ideas I find most disconcerting and annoying mirrors the crazy right’s idea that Obama is a ‘secret Muslim’. Doesn’t matter what the evidence is, it must be true, because, you know, whatever.
On the wild-eyed left, we have the even more annoying idea repeated over and over that Obama is some kind of ‘secret Republican’. He hired Larry Summers? He must be in the pocket of the banksters! Never mind that he signed Dodd-Frank. But Rahm Emmanuel is a jerk and he says mean things about us! Never mind that he was one of the most effective dem chief of staffs in half a century. With these people it never matters what battles Obama wins, all that matters is how far he didn’t go.
It’s that they’re WRONG. Rahm Emanuel didn’t want Obama to pursue health care reform at all. Both he and Summers have been dead-wrong about everything they’ve ever advised on since Glass Steagall. They played pivotal roles in creating the obscene income inequality situation we have and did everything they could to obstruct Obama in reversing.
Seriously – are you really going to sit there and try to say that Krugman and Reich were wrong and Summers and Emanuel were right? REALLY? I mean … REALLY?
I’m saying Emanuel can count votes better than you. He can get bills through on the hill. He is a centrist and I don’t always agree with his opinions. But the fucker can get shit done. And his appointment in no way “proves Obama’s intention to hand his mandate to the 1% on a silver platter”; that’s ridiculous. And while Prof. Krugman is often right (not always — he wanted to nationalize the banks, and that would probably have been a disaster) about the economics, he’s often laughably wrong on the politics.
>But the fucker can get shit done
if he’d had his way ACA wouldn’t have gotten done.
I would have had Obama barnstorm through the country with NOT THIS TIME and call out Baucus & Co. by name until they stopped obstructing. Instead of being “bipartisan” by getting rolled by the repubs he should’ve done it by laying down the law to the corrupt, bribed corporate dems and crucifying their asses in public. As many repubs voted in 2012 as 2010 – the reason the base didn’t come out is because of Rahm Emanuel – real smart guy – that Kool-Aid is rancid by now.
When you run for and get elected president , you can try that approach to passing legislation through the senate. Good luck to you. I can’t think of a single instance in the past century where votes in the Senate on important legislation were moved in any demonstrable way by a presidents “barnstorming the country” <it> against </it> the obstructionist senators in question. Thats not how the senate works. You think you could have scared someone like Lieberman into changing his position on the public option, say, by attacking him from the left? He eats up that kind of attack for breakfast; it strengthens him with a good part of his constituency. Thats why these blue dogs are in the senate in the first place– their views are to a fair approximation in tune with their constituencies.
And, that’s not how the great society got passed, for instance. Instead LBJ built a coalition of liberal dems and repubs (yes there were liberal repubs in those days) via private arm twisting and sausage making on an epic scale, to circumvent the southern dems. Thats what seems to work, and thats what Obama did on the stimulus and what he tried (but failed) to do on the ACA. There, he used legislative trickery (reconciliation), sort of like LBJ did on civil rights act of 1957.
SO yeah, feel free to continue sending those recommendations on how to pass bilss to whoever will listen
Watching critics – have you ever held any legislative office, ever? – hold forth on Barack Obama’s alleged legislative shortcomings is like watching someone who never played baseball respond to Roger Marris’s 61 homerun season by explaining that he should have hit 70, and his batting stance is all wrong.
Fact: Barack Obama passed his health care bill. After decades of failure after failure, this Democratic President is so incompetent at legislating that he actually passed his.
Fact: Barack Obama’s first two years featured the passage of a legislative agenda larger than anyone President’s entire term, going back to LBJ’s.
This is an astounding record of success, and proves to any reasonable person that he is one of the best legislating Presidents in American history. The ability of a blog commenter to proclaim that he wants even more means nothing.
I count myself among those who were disappointed when the tax cuts were extended for the top 2%, but as the 2012 campaign heated up, the decision seemed to make more sense: I can easily imagine the GOP making the upper bracket tax raise the centerpiece of their argument that the president was holding back the recovery of the economy. Meanwhile, little credit would have been given for whatever debt reduction would have resulted from the enhanced revenue.
Given that the economy is now picking up speed, cutting the top rates now is a chance to drive a stake into the heart of trickle down theory. Provided that the pace of the recovery doesn’t falter, the argument for cutting taxes for the rich will have sustained serious damage among those who still give it the benefit of the doubt.
Two more years of the Bush tax cuts may not be such a bad price to pay if the long term outcome is that people in the middle feel the same instinctive revulsion as those on their left when the GOP touts giveaways to the rich.