OK, You Won…Now Pay Up!

November 8th, 2012 at 11:50 pm

There are interesting, challenging, and portentous political economy issues in play right now, and unless you’re taking a well-deserved post-election vacation from such matters, they’re worth your attention.

For example, there’s the question of the whether the upper-income Bush tax cuts will finally sunset.  This was a clear platform of the President’s campaign…in fact, it may have been the policy point he hit the hardest and most consistently.   And significant shares of voters agree (about half support the upper-income expirations, and even more recognize the need for more revenue).

Republicans and their proxies, however, argue that the fact that they held the House was America’s way of saying they don’t want to see any tax increases.  This is wrong, based on not just the above poll results but many other polls that preceded the vote, not to mention the fact that Tuesday’s results decidedly favored Dems.  But it’s predictable.  The R’s, virtually all of whom have pledged away tax policy to Grover Norquist, would make this argument no matter what the outcome was.

It’s also—and this is important—the case that the expiration of the upper income cuts wouldn’t hurt the economy, a very common and consistent result across economic analyses.

Earlier today we had a good conversation over at MSNBC with Martin Bashir on these matters.  Like I say at the end of the segment, I keep running into this Republicans argument: “Ok, you won…now here are our demands.”

That’s some serious chutzpah.  Of course, I understand and support the need for compromise.  As the President emphasized in his victory speech, if we can work together we can solve this thing.  But remember, we’ve already cut $1.5 trillion in spending over the next decade.  Majorities rejected the Romney/Ryan/Norquist position, recognizing that a) there’s an important role for an amply funded federal government, and b) we can’t get there on spending cuts alone.

Sure, we’re a closely divided country.  But the more I pour through election results, the more I think there’s a lot of people out there who understand the economic dynamics and needs of the country a lot better than House R’s.  So stick to your plan, Mr. President, and let’s see what unfolds.

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2 comments in reply to "OK, You Won…Now Pay Up!"

  1. D. C. Sessions says:

    All in all, I’d rather see ALL of the tax cuts expire to show our dedication to curing the deficit, and offset them in the near term with a combination of relief measures for the bottom of the economic scale and explicit temporary stimulus tied to economic performance.

    Well, that ain’t happening.

    As is, though, the PoG is going to be screaming for a combination of increased military spending and permanent tax cuts at the top. Well, if taxes are off the table then they’re off the table — but the price of rescinding the military sequester is to also restor the domestic side, and the price of a temporary across-the-board extension of the tax cuts (tied to unemployment, please) would be an extension of the stimulus measures such as the payroll cuts, unemployment, etc.

    In other words, the status quo ante of 2011, with a debt-limit extension built in.

    Not a great solution, but a genuinely balanced one that won’t hurt the citizenry too badly and if it kicks the tax reform can down the road, well, that’s better than a permanent switch to something harmful.


  2. Jake says:

    Now is the time for the entire country to “vote” on the tactics the House has been using, i.e. our way or we take the country down. Do we want our system of government to resort to such self-destructive measures as the way to make policy? By Obama holding firm on his campaign tax promise, all of us will have a chance through public opinion to “vote” this House tactic up or down as we head for and maybe over the “cliff”. Like the government shutdown during the Gingrich era, it’s about time for the country to weigh in on what tactics it will accept as the way we want our government to make policy.


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