July 09, 2012 08:10 PM UTC

President Obama's Call for Tax Fairness

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• by: madmike

President Obama just made his pitch to Congress and the American people to extend the Bush tax cuts for the middle class, but not for folks making $250K a year.  Mitt Romney and the Republicans promptly countered with their call to extend the Bush tax cuts for “all Americans.”  To which I say, “Wait a minute.”

Aren’t Republicans always whining that 49% of Americans don’t pay any federal income taxes?  If that’s the case, then “all Americans” will not benefit from extending the tax cuts across the board for everyone.  As I see it, a tax cut for people who don’t pay any federal income taxes is no tax cut at all.  I remember when the Bush tax cuts went into effect.  I joked that I was going to take my family out for a pizza with the amount of money I “saved.”  So if the cuts expire, we’ll have to do with a frozen pizza at home.  But letting those cuts expire for people making over $250 a year will do a great deal to bring down our budget deficit.

My guess is that Congressional Republicans are scheming at this minute to come up with a way to sabotage the President’s plan rather than find a way to compromise of this issue.  They will claim that his plan will raise taxes on the “job creators.”  To which I say two things.  First, one must learn how to speak in Republican code.  Whenever you hear them say, “job creators,” substitute the words “rich people.”  Then you get their real message.  Secondly, if the Bush tax cuts were supposed to create jobs, where are they?  Oh yeah, Mitt Romney and friends created them alright – in China and India.

As I understand it this plot is only going to thicken in the coming months.  Unless Congressional Democrats and Republicans can come up with a budget/deficit compromise in the next few months, there will be hell to pay come January 2, 2013 – at least if you’re a Republican member of Congress.  A so-called “sequestration” budget will kick in automatically.  The Bush tax cuts will expire and massive, automatic spending cuts will kick in.  The defense budget will be particularly hard hit with almost fifty percent of the cuts while Social Security and Medicaid would be spared entirely.  So my question to Democratic legislators is, “Who needs to ‘give’ the most in this situation?”  It seems to me it’s the Republicans for one very simple reason.

When the automatic spending cuts take effect in January, the biggest bite will come out of one of the Republicans’ most sacred cows, the defense budget.  Lots of useless projects will be scuttled and thousands of war profiteers will be out of work.  They may even have to cut back on their lobbying budgets and and their campaign contributions.  Oh, well.  As it stands right now, Republicans in Congress won’t even cut programs that the Defense Department doesn’t want, so let the automatic cuts do the work for them.

Finally, the most positive outcome of the sequestration will be to our growing budget deficit.  The deficit will shrink.  President Obama and Democrats in Congress can take credit for being the fiscally responsible ones in Washington.  And Republicans will face the prospect of some very unhappy constituencies back home.

So where is the pressure for any compromise in Congress when it comes to  the Bush tax cuts?  It doesn’t seem to me that it rests on the Democrats.  Let’s hope they stand their ground.