So, great, put up the statement, so we can say “I told you so” later. But there’s no hope of sanity in the next four years.

That, it seemed to me, was a tacit admission that Keynesian economics is correct and I’m surprised nobody has called him on it.

But he also said he wanted to wait until after he was sworn in to do anything about it so that it could be done right.

That, it strikes me, is tantamount to holding the Nation hostage for his own political goals. It’s wrong and it should be called out as such.

“the important issue with respect to the tax cuts is to ensure that tax cuts for low- and moderate-income households do not expire”

and later:

“a cost-effective way to continue using the tax cuts to shore up the weak economy would be to extend the middle-class tax cuts for a year or two, allow the upper-income tax cuts to expire, and extend the tax-credit expansions targeted on low- and moderate-income households. ”

I know you mean that it’s important for the economy, that a sudden tax rise for low and moderate incomes would be a drag economically, and I agree, obviously. I agree that continuing current (Bush) low taxes for them while raising taxes on higher incomes is the simplest way to do that. It is also an impossible way of doing it, I think. If we hold to that first quote we might as well admit that all of the Bush tax cuts are permanent, because the Republicans will demand continuation of the high-end tax cuts as a price for continuing those cuts for middle and lower incomes. This was true last year, and it will be true next year and every future year for all of time.

Trying to parse the Bush tax cuts into high and middle and low is a losing proposition, a losing negotiating position, that I think should be abandoned. There is no remaining honorable purpose in bashing our heads bloody against that wall over and over again, or bashing our country’s head against that wall. Obama—if he is still President when the fiscal “slope” begins its ugly decline—has two realistic options: continue ALL of the Bush tax cuts, or let ALL of them expire and propose a different tax cut, an Obama tax cut, that is weighted toward relief for low and middle incomes.

If he chooses that path he has a chance of winning the fight. If he keeps trying to negotiate a finely parsed outcome with a grim and unyielding opposition he will always lose.

Its time we had some stringent standards for what can qualify to be called “stimulus” spending. When such a huge portion of what we’re forgoing in revenue simply goes to pay down debt or add to the coffers of our oligarchs, the deficit goes up without any of the effects that “real stimulus” would have. This just feeds Republican propaganda saying that stimulus spending doesn’t work. If a huge proportion of the money isn’t getting to those with a high MPC (which it isn’t), we’re probably better off letting all of the tax cuts expire on schedule and minimizing the risk of these being made permanent. Unless Obama wins AND Democrats win big in both the Senate & House, new revenues will be incredibly hard to come by. With unemployment benefits expiring for so many, we’re probably better off collecting additional revenues to offset the increases in food stamps and medicaid. As long as Republican obstructionist are able to block all real solutions, we should be thinking in terms of bracing ourselves for the inevitable consequences and not risking the permanent extension of these tax cuts.