Monday, December 6, 2010


President Obama announces a bipartisan deal on tax cuts in a video address Monday. (The White House)


There is absolutely no "nice" or "polite" way to say the obvious and I won't pretend to try, so let's just say what it really is and be done with it: THIS IS NOTHING BUT A HUGE SELLOUT AND RANK CAPITULATION TO THE REPUBLICAN RIGHTWING THAT WILL HAVE NOTHING BUT TRULY DIRE CONSEQUENCES FOR THE AMERICAN PEOPLE IN BOTH THE SHORT AND LONG RUN AND THAT'S ALL IT IS. There is nothing even remotely resembling a "compromise" (get real!) much less a "negotiated settlement" (pleeze!!) in this. In other words: Let's not play stupid rhetorical games here and simply tell the straightup truth for once--Obama has pathetically allowed both his and our most virulent, relentless, and destructive enemies to completely bully, corner, and then openly pimpslap his cowardly ass in public, and at the same time made him and the Democrats glumly thank them for the "privilege." It's a brazen display of sheer ineptitude and bumbling self pity masquerading as "political dealmaking" and anyone who says it ain't is nothing but a LIAR and a clueless apologist...



Obama outlines tax cut deal that extends jobless aid

Over the objection of many Democrats, he gives in to Republicans on keeping breaks for the wealthy.

Reporting from Washington —

December 6, 2010

Over the objections of many in his own party, President Obama on Monday announced a deal with Republicans to extend the Bush-era tax cuts for all taxpayers, keep jobless benefits flowing for 13 months and continue a series of tax breaks for the middle class.

The deal, which breaks a weeks-long standoff between Republicans and Democrats, also includes a GOP-backed proposal to revamp the estate tax and lower Social Security payroll taxes by 2 percentage points to put more money into workers' pockets.

Obama made it clear that he disagreed with some aspects of the deal — in particular, the extension of tax cuts to the wealthiest earners, something he has vowed to fight since his election campaign two years ago.

But Obama said that it was more important to settle the issue so that middle-class taxpayers did not incur a tax increase after Dec. 31, when the cuts are scheduled to expire.

"I have no doubt that everyone will find something in this compromise that they don't like. In fact, there are things in here that I don't like," Obama said. "For now, I believe this bipartisan plan is the right thing to do."

But many Democrats said Monday that they were deeply troubled by the compromise, which gives them some substantive concessions from the Republicans but goes against the Democrats' longstanding opposition to extending tax breaks for the wealthiest Americans.

The dispute represents the clearest sign yet of the gaping divide between the White House and congressional Democrats as Obama strives for bipartisan accord to accommodate a Republican Party emboldened by last month's midterm elections.

As a result of the unusual split, many Democratic lawmakers may vote against the deal, despite the president's blessings.

Underscoring the division, liberal activists pelted the White House and congressional Democrats on Monday, tying up phone lines with a massive call-in campaign to oppose a deal that extends tax breaks on earnings beyond $250,000.

The White House now faces the daunting task of winning congressional support for what administration officials billed as a bipartisan compromise.
House Republicans signaled their agreement with the deal, and Sen. Mitch McConnell (R-Ky.), the Senate GOP leader, said Obama's outline marked an acknowledgement by the White House that "a new direction is needed if we are to revive the economy and help put millions of Americans back to work."

Obama moved to quell the rebellion by congressional Democrats, summoning them to a White House session Monday to explain the "framework" of the proposal. Democrats left the afternoon meeting without signing on to the agreement.

Despite additional tax breaks for middle-class households, "Democratic leaders are not completely comfortable with this," said one Democratic aide, speaking on the condition of anonymity to describe internal discussions.

The White House is dispatching Vice President Joe Biden to meet with Senate Democrats on Tuesday.

Senate Majority Leader Harry Reid (D-Nev.) issued only a terse statement after Obama unveiled the compromise.

"Now that the president has outlined his proposal, Senator Reid plans on discussing it with his caucus," his spokesman said.

Underscoring the partisan ambivalence, the president stood alone at the White House in making the announcement of the tentative agreement, which came after tense days of negotiations.

Earlier Monday, Obama foreshadowed the likely deal in an appearance in Winston-Salem, N.C.

"There are some serious debates that are still taking place," Obama said at a technical college. "We've got to make sure that we're coming up with a solution, even if it's not a hundred percent of what I want or what the Republicans want. There's no reason that ordinary Americans should see their taxes go up next year."

Congress faces a Dec. 31 deadline to resolve the impasse over tax cuts passed during the George W. Bush administration. Without action, American taxpayers would see their income tax rates rise an average of 3% in January, an outcome neither party wants.

Republicans last week blocked Democratic attempts in the Senate to extend tax breaks on earnings up to $250,000. A compromise was increasingly seen as a foregone conclusion, and the White House has been negotiating with Republicans who have held out for an extension of all tax cuts, despite the additional $68 billion annual cost of tax breaks for the wealthy.

Extending unemployment insurance through 2011 would cost $56 billion. Without action, an estimated 2 million jobless Americans will see their benefits expire during the holidays.

The White House had pressed to include an extension of the expiring "Making Work Pay" tax credit, given to 95% of taxpayers in 2009 and 2010 as part of the economic stimulus bill. The tax break provided up to $400 a year to working singles who made $75,000 or less, and up to $800 to couples earning $150,000 or less. Democrats argue that allowing it to expire would amount to a tax hike on middle-income Americans.

Republicans have been cool to extending the tax credits, after having almost unanimously opposed the stimulus act 2009. The GOP wanted a lower estate tax.

By Monday, the White House had dropped its insistence on the Making Work Pay tax break in favor of the 2% payroll tax holiday, which is expected to cost $120 billion.

The White House also agreed to a Republican-led proposal on the estate tax, which would exempt estates valued at $5 million for singles and $10 million for couples from a 35% tax — a particularly difficult concession for Democrats who had pressed for a lower exemption and higher tax rate.

Over the weekend, House Democrats told Biden that the administration may lose votes from congressional Democrats if any compromise is not paired with other middle-class enhancements.

"Assuming House Democrats will sign off on a deal the White House cuts with [Republicans] is incorrect," said the Democratic aide.

As Democrats convened at the White House on Monday, they were told this was the best deal they would be able to get in the face of Republican intransigence.

Senate Democrats also have indicated displeasure with being forced to compromise on an issue many believe is a signature difference between Democrats and Republicans.

"I'm just hoping that the president sticks to what he said in Iowa in the campaign … that he was drawing the line at $250,000," Sen. Tom Harkin (D-Iowa) said late last week. "The president ought to stick to what he said and stick to his guns."

In the political calculations of the White House, Democrats will be able to more effectively campaign against tax breaks for the wealthy in 2012, when the president is up for reelection.

"We expect this will be a central piece of the debate," a senior administration official said. "It's a debate that we had in 2008 and won, and it's a debate we think the American people should have."

Peter Nicholas of the Washington Bureau contributed to this report.

December 5, 2010

Bush Tax-Cut Deal With Jobless Aid Said to Be Near
New York Times

WASHINGTON — White House officials and Congressional Republicans said Sunday they were closing in on a deal to temporarily continue the Bush-era tax cuts at all income levels, while bitterly frustrated Democratic Congressional leaders began exploring whether they would have the votes for such a package.

A day after the Senate rejected President Obama’s preferred tax plan, officials said the broad contours of a compromise were in focus.

Rather than extending the tax rates only on income described by Democrats as middle class — up to $250,000 a year for couples and $200,000 for individuals — the deal would also keep the rates for higher earners, probably for two years. In return, Republicans said they would probably agree to extend jobless aid for the long-term unemployed.

Senior Democrats on Sunday said that they were resigned to defeat in the highly charged tax debate, and they voiced dismay.

“We’re moving in that direction,” Senator Richard J. Durbin of Illinois, the No. 2 Democrat said dejectedly when Bob Schieffer, host of “Face the Nation” on CBS, asked him if the 2001 and 2003 tax rates would be extended even for the wealthy. “And we’re only moving there against my judgment,” Mr. Durbin added.

In meetings with administration officials after the Senate votes, the House speaker, Nancy Pelosi, and many other House and Senate Democrats voiced deep unhappiness at the prospect of extending all the tax cuts and also expressed their belief that the White House did not appear to be getting enough for such a big concession, officials said.

That sort of anger raised the likelihood that Republicans would have to generate large numbers of votes to advance any deal in Congress, much as they did to help approve the big financial system bailout at President George W. Bush’s request in 2008.

White House officials, meanwhile, expressed hope of sealing a deal swiftly, perhaps by midweek, and clearing the Congressional calendar for a long list of other priorities that they aim to accomplish by the end of the year, including ratification of the New Start arms treaty with Russia and the repeal of the “don’t ask, don’t tell” policy for gay service members as part of a wider Pentagon policy bill.

Administration officials said the negotiations were focused on the question of extending the tax rates for one or two years, with a three-year extension highly unlikely, even though that time frame would probably eliminate the tax fight as an urgent issue in the 2012 elections.

Many Republicans say they want a permanent extension of the rates, or as long an extension as possible. Democrats say they would not mind the issue coming up during Mr. Obama’s re-election bid, because they see it as politically helpful to them in painting Republicans as defenders of the rich. The debate, of course, could cut the other way, with Republicans again portraying Democrats as seeking to raise taxes.

Some Congressional Democrats have suggested a willingness to let the tax rates expire for everyone at the end of the year, and to press the fight into next year. At the same time, some prominent economists have counseled that it would be wise not to substantially raise taxes or cut spending at the moment given the risk of further hindering an already precarious economic recovery.

In an interview on “60 Minutes” on Sunday night, the chairman of the Federal Reserve, Ben S. Bernanke, said policy makers should be careful to protect the recovery in what could be interpreted as a warning to Democrats not to raise taxes and to Republicans not to cut government spending. “We don’t want to take actions this year that will affect this year’s spending and this year’s taxes in a way that will hurt the recovery,” Mr. Bernanke said. “That’s important.”

But Mr. Bernanke also warned about the dangers of the nation’s fast-growing debt, which will be increased by $4 trillion or more over 10 years as a result of the tax deal being worked out by Republicans and the White House, and said policy makers must start thinking now about the “long-term structural deficit.”

After the failed votes in the Senate on Saturday, top Democratic Congressional leaders met at the White House with Mr. Obama, who told them he would not agree to any deal unless it included the extension of jobless aid, which has begun to run out, and also the extension of a number of tax breaks for middle- and lower-income Americans that were included in last year’s economic stimulus plan.

In a twist on the Republicans’ argument that letting the Bush-era tax cuts expire would amount to a tax increase in a weak economy, Mr. Obama said allowing the stimulus provisions to expire would result in a similar tax increase on working-class Americans who could afford it even less than the high-income people who would benefit from the Republicans’ plan.

The Democratic Congressional leaders attended another strategy session at the residence of Vice President Joseph R. Biden Jr., who has taken a personal hand in the negotiations with Senate Republicans, with whom he has personal relationships from his long tenure as a senator.

Other participants included the Treasury secretary, Timothy F. Geithner, and the budget director, Jacob Lew, who are attending the formal negotiations with Congress on behalf of the White House; the House majority leader, Steny H. Hoyer of Maryland; and Representative Chris Van Hollen of Maryland, who is representing House Democrats in the official talks.

The Senate Republican leader, Mitch McConnell, has made it clear that from the Republican perspective, there is little left to discuss about the tax rates. “Look, this argument is over,” Mr. McConnell said in an appearance on “Meet the Press” on NBC. “The Senate voted yesterday. Every Republican and five Democrats said we’re not raising taxes on anybody in the middle of a recession.” The outcome of those votes was such a foregone conclusion, he said, “It’s almost laughable that we were in session yesterday.”

Still, Mr. McConnell said Republicans were negotiating on several fronts. He said that he understood Mr. Obama would not agree to a permanent extension of the Bush-era tax rates. “Obviously, the president won’t sign a permanent extension,” he said. “So we’re going to have some kind of extension. I’d like one as long as possible.”

And Mr. McConnell acknowledged that there would be a continuation of jobless aid for the long-term unemployed, though he reiterated the Republican contention that the cost should be offset with reductions in spending elsewhere.

“I think we will extend unemployment compensation,” he said. “We’ve had some very vigorous debates in the Senate. Not about whether to do it but whether to pay for it as opposed to adding it to the deficit. All of those discussions are still under way.”

Many Democrats are enraged that Republicans have so far blocked the effort to extend jobless aid, and are insisting on offsetting the cost even as they refuse to offset the lost revenue from the tax cuts.

“They’ve said, ‘No, we are willing to hold that hostage so that we can give the wealthiest people in the country a bonus tax cut,’ ” said Senator John Kerry, Democrat of Massachusetts.