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All Da King's Men

Maybe Obama IS Smarter

By Da King Published: December 11, 2010

Liberal Democrats are throwing major hissy fits over President Obama's so-called tax cut deal with Republicans. Meanwhile, most Republicans appear to be tentatively supportive of the deal.

My question is, why is either side taking it's positions ? Let's look at the tax cut deal from a purely political viewpoint. I'll try to put my own opinions aside (mostly).

Let's look at the liberal side first. I ask liberals, what are you crying about ? What did Obama give up ? The only thing I can see liberals objecting to in the deal is two more years of Bush tax cuts for those making over $250K, meaning no tax increases for only TWO YEARS. This also means the "tax cuts for the rich" class warfare weapon will still be in the Democratic arsenal for the next presidential election. In return for giving up those measly two years of no tax increases during a recession, Obama got EVERYTHING else he wanted - a $57 billion extension of unemployment benefits, a $225 billion payroll tax holiday, an assortment of tax credits, more federal spending, etc. Obama has effectively gotten his second round of economic stimulus passed if the deal goes through, and liberals have been calling for more stimulus for nearly two years. The CBO scored Obama's tax cut deal on friday, and said it would add $893 billion to the deficit over the next five years, with $756 billion of that coming from lost revenue. The CBO says the biggest factor in "lost revenue" is the renewal of the Bush tax cuts (all of them). Now, I have a problem with calling the renewal of marginal tax rates that have been in place for a decade "lost revenue," but I'll leave that argument alone for now, other than to point out it's also "lost revenue" for the government when anyone's marginal tax rate is lower than 100%. That is no justification for stealing people's wages.

In summary, liberals are howling mad because the marginal tax rate for families and small businesses making over $250K (over $200K for a single person) are going to stay at 35% instead of rising to 39.6%. That doesn't seem like something to get howling mad about to me, especially when the whole argument will be revisited in two short years.

Obama didn't give up much, but he did do something huge to Republicans. Remember, the GOP just won huge election victories running as the party of fiscal responsibility, by co-opting the Tea Party message of reducing spending and lowering the deficit. With the tax cut deal, Obama stripped away some of the GOP's claim to fiscal responsibility by getting them to agree to more spending and more deficits/debt. Liberals, who really don't care about deficits and debt in the first place, will now say "look, the Republicans just added almost $900 billion to the debt. What a bunch of hypocrites." Even though that $900 billion amount is wrong, the GOP will agree to increase the debt if they approve the deal, just the opposite of what they promised to do throughout the entire election cycle. Yes, Obama broke his word on the Bush tax cuts as well, but in doing so, he has succeeded in positioning himself as both a populist and a centrist, while getting Republicans to partially abdicate their claim to fiscal responsibility barely a month after the elections.

Maybe Obama is a smarter politician than either liberals or conservatives give him credit for. He has pissed off his liberal base, but if the recent elections told us anything, it told us America rejects the liberals. Liberals only represent 20% of the populace. It's also unlikely that Obama will be able to muster the kind of euphoric insanity among young voters in 2012 that pushed him to victory in 2008. If Obama wants to be a two-term President, he has to capture the middle, the independents, and those are the very people who rejected the Democrats in 2010. And let's face it, who else are liberals going to vote for in 2012, if not Obama ? Palin, Gingrich, Huckabee, or whomever ? I don't think so.

With this tax cut deal, Obama WINS. He gets his desired stimulus, and everyone's paycheck gets larger for a couple years. The Republicans lose. They lose the claim to fiscal responsibility. The liberals live to fight the same class warfare battle all over again in 2012, just when they want to fight it most.

Maybe Obama IS smarter.

P.S. - While I'm on the subject of Republicans abdicating fiscal responsiblity and election promises, guess who is having second thoughts about banning earmarks ??? That would be...Republicans. It seems some Republicans, including Rep. Michelle Bachmann, the queen of the Tea Parties, have suddenly realized that by banning earmarks, they don't have a way to fund the federal projects they want for their districts, aka, earmarks. Uh, no kidding. What did you GOP'ers think an earmark was, getting a piercing down at the local mall ?

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