Zentrope

Tax Theater

This weekend, the Democrats put up a bill to maintain the tax cuts on the first $250K of our income, allowing the tax cut to expire on amounts higher than that. The Republicans filibustered but the Democrats didn’t have the “cloture” votes to over come it.

Next up was a bill to extend the tax cuts for the first million dollars of income, and, again, the Republicans successfully defeated the bill by defeating the cloture vote.

The Republicans say that while the tax cuts didn’t create a burgeoning economy (as was promised), they nevertheless prevented a worse recession. The Democrats (backed by economists), say that the extra money gained by the wealthy from the tax cuts could never improve an economy, while more spending money for the middle class can (because it helps to increase demand). On the contrary, the economy seemed much better off before the tax cuts than after. In addition to all this, the additional tax revenues will help the government implement programs to help with job recovery, and, long term, reduce the rate at which the deficit grows until such time as the economy recovers, and budget balancing can begin in earnest.

The next day, Senator Mitch McConnell, Senate Minority Leader, said he thought the Democrats will cave on the tax issue before the session closes for the holidays.

What will happen next?

There seem to be several predictions:

• The White House is angling to compromise on the tax cuts (extending them as is for another few years) in order to get passage of other bills, such as the repeal of Don’t Ask Don’t Tell (DADT) and the new StraTegic Arms Reduction Treaty (START2). The implications seem to be that the these important bills will get passed, and they’re good bills, but the extended tax cuts will 1) help to fuel the deficit, and 2) give ammunition to Republican claims of fiscal responsibility, small government advocacy, etc.

• The Democrats will refuse to pass any tax cut bill for the wealthiest few percent of Americans and hold to it, using the opportunity to play up the fact that Republicans are only interested in representing the interests of the super rich.

Questions:

1. Where does President Obama stand on all of this? Presumably, he’s very sympathetic to the fiscal responsibility rhetoric, only he really means it, whereas Republicans actually don’t (as all the evidence suggests). However, I think his desire to do good government without bitter and petty party politics is, in fact, getting in his way of doing good government.

2. Will the Democrats finally stick to a core value without completely undercutting it in the name of compromise? The Democrats have always been week on sticking to their values, mainly, I think, because one of their values is getting useful things done, which requires compromise. Also, they’re of the same class as Republicans, most of them, so I don’t see them sticking to their professed values either. Their one saving grace is that when voters raise up a hue an cry about an issue, the Democrats do their best to address it. By contrast, Republicans create the hue and cry of their core voters as a reaction to the Democrats and when they don’t follow through on their promises, they blame the Democrats, which re-inforces their ability to create the hue and cry.

Anyway, aside from my personal thoughts on the matter, I want to follow the story a little more closely than I might normally (which is hardly at all), just to see if I can learn anything about how these things are done, or perceived, or how the move through the media: something. Anything.