Democrats Can Lose Debt Fight, Win on Bush Tax Cuts

[jefferson_dem]

Democrats Can Lose Debt Fight, Win on Bush Tax Cuts
By Ezra Klein Jul 27, 2011 8:00 PM ET

Democrats are going to lose this one. Whatever deal emerges to raise the debt ceiling, we can be pretty sure it won’t include revenue, it won’t include stimulus, and it will let Republicans pocket a trillion dollars or more in cuts without offering anything to Democrats in return.

It’s difficult to see how it could end otherwise. Virtually no Democrats are willing to go past Aug. 2 without raising the debt ceiling. Plenty of Republicans are prepared to blow through the deadline. That’s not a dynamic that lends itself to a deal. That’s a dynamic that lends itself to a ransom.

Yet Democrats will have their turn. On Dec. 31, 2012, three weeks before the end of President Barack Obama’s current term in office, the Bush tax cuts expire. Income tax rates will return to their Clinton-era levels. That amounts to a $3.6 trillion tax increase over 10 years, three or four times the $800 billion to $1.2 trillion in revenue increases that Obama and Speaker John Boehner were kicking around. And all Democrats need to do to secure that deal is -- nothing.

In fact, Democrats can just let the Republicans stop them from doing anything. Imagine that Obama and the Democrats simply adopt the recommendations of the Simpson-Bowles/Gang of Six deficit reduction plan -- tax reform that raises $2 trillion over 10 years and cuts rates for everyone. Republicans will almost certainly refuse any plan that raises any taxes on anyone. But if Republicans won’t budge, the Democrats can simply blame them for the gridlock that enables the Bush tax cuts to expire.

This scenario is the inverse of the current debt-ceiling debate, in which inaction will lead to an outcome -- a government default -- that Democrats can’t stomach and Republicans think they can. There is only one thing that could stand in the way of Democrats achieving their revenue goals on the last day of 2012: the Obama administration.

<SNIP>

http://www.bloomberg.com/news/2011-07-28/democrats-can-lose-on-debt-win-on-bush-tax-cuts-commentary-by-ezra-klein.html

[ProSense]

1. Ezra's logic

is spinning this as a loss for Democrats.

Democrats are going to lose this one. Whatever deal emerges to raise the debt ceiling, we can be pretty sure it won’t include revenue, it won’t include stimulus, and it will let Republicans pocket a trillion dollars or more in cuts without offering anything to Democrats in return.

The good thing is that at least $1.2 trillion are cuts to the defense budget from ending the wars.

It’s difficult to see how it could end otherwise. Virtually no Democrats are willing to go past Aug. 2 without raising the debt ceiling. Plenty of Republicans are prepared to blow through the deadline. That’s not a dynamic that lends itself to a deal. That’s a dynamic that lends itself to a ransom.

Well, Democrats don't want that to happen, but the Congressional Black Caucus and some in the House Democratic leadership are urging the President to use the 14th Amendment in the event.

Yet Democrats will have their turn. On Dec. 31, 2012, three weeks before the end of President Barack Obama’s current term in office, the Bush tax cuts expire. Income tax rates will return to their Clinton-era levels. That amounts to a $3.6 trillion tax increase over 10 years, three or four times the $800 billion to $1.2 trillion in revenue increases that Obama and Speaker John Boehner were kicking around. And all Democrats need to do to secure that deal is -- nothing.

True, and this is why Republicans don't see this as a win.

The fact is that, not only would they love to blow up the country and attempt to blame it on the President and Democrats, but they also don't want to be seen as giving into Democrats (Reid's plan) on deficit reduction. No matter how you slice it, this deal will be seen as major deficit reduction credited to President Obama. This is not where Republicans wanted to end up.

[bigdarryl]

2. Kleins a JACKASS!!!

[OHdem10]

3. Let us be honest--Democrats on the Hill always cave. We have

a Republican Party that calls itself Democratic.

I will joyfully take this back. I thought this last
night as soon as I heard Boener was getting his party
in line.

To hold out against the Republicans you need Democrats
who are Democratic to the bone. We do not have this.

[dkf]

4. That is why it was lame to make revenue increases central to the case.

Now we look like losers when we should have known Republicans wouldn't budge.

Stupid stupid stupid.

And after 2012 we will get more than what we were asking for in revenue. Anyone who looks at the numbers should know we need all that revenue, not just the minimal amount from incomes at the top.

[Pholus]

9. I said that last time they were going to expire. Look how THAT turned out.

And the Republican's will definitely be more reasonable after the next election too and would never THINK of taking another hostage now that they've managed to win with that tactic THREE TIMES IN A ROW.


I get tinnitus just trying to follow the "lie down and take it" line of reasoning.

[tularetom]

5. Last year the republicans held the unemployment benefits hostage

Until Obama gave them an extension of the bush tax cuts.

IMO it's almost certain that they will create another fake crisis in 2012 to get the president to once again extend those tax cuts.

Based on past performance I'm not at all sure that he would refuse to do so.

[alcibiades_mystery]

6. The GOP calculus is that the Dems will lose the Senate and Presidency next year

That's what all this is about, after all. That way, the tax cuts expire, and they simply write new tax cut legislation three weeks later, to take effect immediately, of course.

So, the question is: will we stop them?

[Kaleva]

7. But unless Repubs get a super majority in the Senate...

a bill to extend the Bush tax cuts won't make it thru that chamber.

[alcibiades_mystery]

8. Ah, yes

The common vision of the Dems filibustering fucking anything, especially tax cuts.

Happens all the time.

:rofl:

You know what phrase you're going to hear 1200 times and hour should the above scenario unfold?

Up or Down Vote. Up or Down Vote. Up or Down Vote, and etc.

[Enrique]

10. it's so predictable n/t

[Jefferson23]

11. Bookmarked, we shall see. K&R n/t

[Liberal_Stalwart71]

12. It won't include revenues because the Bush tax cuts are in effect until 2013.

And of course, we don't want the poor and working/middle class to be hurt by ending the Bush tax cuts too early.

A tax raise on the wealthy would never make it through the House, so you're right. No revenues. No closing of loopholes. Rather than DU getting angry at Obama, look to the Teabaggers/ReThugs who have signed pledges to Grover Norquist.

I don't think it's a loss to Dems in the long term.

[Safetykitten]

13. "On Dec. 31, 2012," Oh. My. God.