The Obama deal:While I'm not impressed with it, perhaps everybody needs to learn more about how it came about before rendering a judgment. How did the negotiations go? Who was asking for what? What did each side concede, when, and why? Why was Congress out of the loop this time and the White House engaged - the exact opposite of the health care legislative process?
What started out as a simple
unemployment extension + keep the middle class cuts in exchange for
keeping the upper income cuts, suddenly got much more complex. What I want to know is:
- Where did the cut 2% of FICA taxes come from? That would appear to be something that could be done separately (with support from both parties, even though it carries the risk of becoming permanent and weakening Social Security).
- How did the bargaining on the estate tax go? The Washington Post advocated going to the 2009 schedule of $3.5 million exempt and a 45% rate - which was the lowest of the 10 year period (not counting 2010's no tax). That position, keep the 2009 schedule for estate taxes was considered to be the Republican position by many. How did the Obama deal end up being more generous? It's a mystery.
The deal was reached in a surprisingly short time and feels rushed and overstuffed. Almost as if by bringing in many disparate elements, it becomes harder to critique it - because the complexity makes it harder to assess its value (for Democrats and Republicans).
posted by Quiddity at 12/07/2010 07:55:00 PM
Michael Lind in Salon:Starts out with
this:
Most Americans want Social Security to be strengthened and American manufacturing protected. But the conversation among elites inside the Beltway-New York bubble is about cutting Social Security and more one-sided "free trade" deals with mercantilist nations that, unlike the U.S., protect and promote their domestic industries.
Many Americans have come to the conclusion that nobody represents them in Washington anymore. They are right.
He goes on to discuss mass-membership organizations (e.g. unions) as the main reason why. Two weeks ago Frank Rich said Congress is disconnected from the American people, but gave a different explanation:
big money in politics.
Whatever the reason, there continues to be frustration by the typical voter with what's going on in Washington and it's not clear what will change that.
posted by Quiddity at 12/07/2010 09:22:00 AM
Expect to hear more about this:For the next two years, estates up to $5,000,000 will be protected from the estate tax, and the tax rate for the few estates that are taxed will be 35 percent. That's worse than the 2009 estate tax ($3.5 million exemption, 45 percent rate)
[45 percent was the lowest rate after a series of reductions in the last 10 years, not counting this year's zero rate; the exemption grew during the same period to a maximum of $3.5 million]
In this case Republicans got more than an extension of current rates and policies.
posted by Quiddity at 12/06/2010 10:53:00 PM
The defining Obama quote:"Sympathetic as I am to those who prefer a fight over compromise, as much as the political wisdom may dictate fighting over solving problems, it would be the wrong thing to do."
Expect that to be cited a lot in coming years.
posted by Quiddity at 12/06/2010 09:40:00 PM
The strategy explained:By extending the tax cuts for the rich, in two more years they will be even richer - which will heighten the contradictions - making the Democrats' charge that "Republicans are defenders of the rich" all that more potent. It's a shrewd political move designed to kick the can down the road until better circumstances prevail. Much like the wildly successful Kansas–Nebraska Act.
posted by Quiddity at 12/06/2010 09:00:00 AM
Speeches:Jonathan Chait
ruminates on the (apparent) failure of the Democrats to pass a tax bill without caving to the Republicans. Of interest is this from a commenter: (emp add)
Obama's failure to lead on this issue is going to be the final straw for a lot of liberals and independents, and for precisely the reason Chait points out. Americans want their president to be a leader. Many of us thought Obama had it in him to be a leader when he was breathing fire on the campaign trail. The Jefferson/Jackson speech he gave in Iowa, the victory speech he gave in SC, the race speech in Philly, the nomination speech--those were moments when he showed more grit and passion than anyone else in politics. That man has completely disappeared. (...) What the hell happened?
Speeches are fine, but they are not enough. You have to also work the halls of Congress. And eve if you believe in the power of speeches, where's the tax-policy speech from Obama?
posted by Quiddity at 12/02/2010 02:29:00 PM
Obama's test:There a lot of grousing about Obama today.
Ezra Klein,
John Cole of Balloon Juice (and his commenters), even
Kevin Drum is not particularly hopeful.
While Obama has been criticized in the past for not doing enough, his supporters could argue that passing new legislation meant dealing with the 60-vote Senate, along with other procedural hurdles. I never found those arguments convincing, but it was often a subjective call as to whether or not Obama was doing as well as expected (or promised).
But the tax cut extension is a different matter. If there is no action, the taxes go back to the 2000 rates. And Obama holds the veto pen. So he can play hardball and demand only a bill to his liking. Play it out and see what happens.
It looks as if that isn't going to take plce. You can think of a number of explanations why. But the key result will be that Obama will lose a ton of support from Democrats if he treats the tax extension like the other legislation: As if both sides have the same bargaining power.
Watch what happens this month. It will be of greater significance than almost anything else that's happened so far.
UPDATE: Here's an interesting
observation by a commenter at Balloon Juice:
Obama is a strict Constitutionalist and he understands what the original intent of the Republic was in having the three branches. He wants to pull power back from the executive and put more into the hands of the legislative, i.e., less rule by fiat than we have seen in almost 200 years. He doesn’t believe in the bully pulpit, he believes the president’s job is to do what the legislative tells him to do. He wants to lead the executive branch, not the nation.
It’s a sweet notion that was relevant at the signing but went out the window soon after the ink dried. He doesn’t get it.
He may be right in believing, accepting my premise, that a less powerful executive is better for democracy but he fails to realize that times have changed.
Not sure I buy it, but it's an intriguing notion.
posted by Quiddity at 12/01/2010 07:30:00 PM 
