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Since 2008 – Progress Through Politics

Krugman decides Politics over Policy

A few months ago, Paul Krugman noted that allowing taxes to rise on the middle class during these tough economic times would be bad.

Now, he seems to have a change of heart…sort of.  

Democrats have tried to push a compromise: let tax cuts for the wealthy expire, but extend tax cuts for the middle class. Republicans, however, are having none of it. They have been filibustering Democratic attempts to separate tax cuts that mainly benefit a tiny group of wealthy Americans from those that mainly help the middle class. It’s all or nothing, they say: all the Bush tax cuts must be extended. What should Democrats do?

The answer is that they should just say no. If G.O.P. intransigence means that taxes rise at the end of this month, so be it.

http://www.nytimes.com/2010/12…

In his column this morning, Krugman suggests the Democrats should reject any compromise and just allow the tax cuts to expire. (He also seems to not realize that the decision to make the middle class cuts permanent was not a “compromise,” but rather part of Obama’s campaign promise)

Think about the logic of the situation. Right now, the Republicans see themselves as successful blackmailers, holding a clear upper hand. President Obama, they believe, wouldn’t dare preside over a broad tax increase while the economy is depressed. And they therefore believe that he will give in to their demands.

Well, yeah, even you said it would be terrible if taxes went up on the middle class, Paul. That’s why he has to give in to their demands.

But while raising taxes when unemployment is high is a bad thing, there are worse things. And a cold, hard look at the consequences of giving in to the G.O.P. now suggests that saying no, and letting the Bush tax cuts expire on schedule, is the lesser of two evils.

Paul is talking about politics here. He says it’s much worse to let the GOP win this argument because it they will continue to blackmail Democrats (because they won’t blackmail us anymore if we let the cuts expire?), and thus this is the better option.

then, he says, Obama would have to pin the blame on Republicans.

So Mr. Obama should draw a line in the sand, right here, right now. If Republicans hold out, and taxes go up, he should tell the nation the truth, and denounce the blackmail attempt for what it is

.

So basically what Krugman is saying is that Obama has to reject a deal and allow what he even said would be a terrible policy that he admits would keep unemployment .1%-.3% higher and then somehow blame the Republicans for letting it happen, all the while completely destroying the decades-old conventional wisdom that tax hikes are always Democrats’ fault, all because he needs to look “strong.”

Because I’m sure when taxes go up in January, middle class Americans all across the land are going to go “That’s ok Obama, at least you stood your ground.” And I’m sure the hundreds of thousands of people who will be unemployed because of the tax cuts expiring will stand up and say “It’s totally cool Obama, at least you stood up to the Republicans, and don’t worry about not getting the unemployment extensions. It’s better I live in a box than you be perceived as weak”

And what happens when the ire of tax hikes turns dramatically against Obama and he goes down, leading to President Thune and the GOP Congress making those cuts permanent ANYWAY in 2013?

Oh, of course, the fault will be with “the messaging”  


Categories: Uncategorized.

/ 264 Comments

264 comments

  2. jsfox

    and sad. Progressives seem to be more than willing to tell the unemployed sorry, every war has collateral damage and your it on our war on the wealthy.

  3. creamer

    But by then they were scared to death.If not for the unemployment issue, I would let them expire. We couldn’t afford them in 01, we can afford them less now.

     The other downer here is in 2012 the republicans will get to campaign on protecting your tax cuts and we are going to talk to the creidt card nation about fiscal responsibility.

  4. spacemanspiff

    Like DTO said upthread:

    Unemployed people are desperate, they’ll happily give tax cuts to the rich if it means they won’t starve.

    We’ve got to plug the leaks and worry about getting safely to shore first.

    We’ll worry about building a better boat later.

  5. jsfox

    the full blown fire storm over at Dkos last night about this deal I have decided I am not a progressive or at least one as defined by the folks at DKos and elsewhere.

    I am just unwilling to throw the unemployed under the bus, pull $320 billion worth of stimulus out of a shaky economy to make what now amounts to a point.

    Weak, spineless? I’ll take it any day over heartless.

  6. Dorothy Rissman

    It seems that many on Kos are actually anarchists.  But, suggesting it would be better if Palin is elected in 2012 is off the chart.

    I am new here, but I have been reading  this site for some time.

  7. Jjc2008

    and I consider myself to be a reasonable human being and  I am a minority here because I believe dems including the president have to fight harder and compromise less. I felt that way with Bill Clinton also.

    I disagree that one is being an anarchist or unreasonable when one strongly disagrees with the president.  I believe he has been reaching out since day one of his administration and the other side has been totally unfair, stubborn and unwilling to put Americans before the oligarchy.

    I don’t know if the president and the left can win this.  But I do believe they can all fight harder, especially the president.

    The center has been moving right for three decades and if we continue to appease, give in, it will continue to move right.

    Yes, it is hard to imagine the unemployed suffering more but many of them will.  THIS is a trade off imo that helps a few of the unemployed, not all, yet gives so much more the the wealthy who are still being rewarded for outsourcing jobs, breaking the backs of the union.

    Yes, Obama has done some good things.  But no matter how unpopular it makes me here or anywhere, I will say the truth. I want more of a fighter.  Some things are worth fighting for…

  8. Jjc2008

    I have been paying attention to politics since I was a kid.  I paid attention to the hysteria over a catholic becoming president. I was 14 years old.   I paid attention to the sweat shop condition in which my mother and many immigrants like her worked, and to the fear surrounding their attempts to form a union.  

    I paid attention as I heard how the police (my father was one and thus were many of his friends)had stand guard over the house of an army general who had moved into a white area of Chester, PA and since this general and his family were African Americans, they were endangered.  I cheered when I heard about the Freedom Riders heading south to register voters and wished I could go. I was too young and my parents said no.

    All thru my college years, I paid attention as I saw many friends/family either go to Vietnam, go to jail for refusing to go to Vietnam, or stay in college long past their time to avoid the draft.  I learned how the rich boys in our town got to join the national guard while the poor boys went off to war.

    I paid attention as I walked picket lines to fight for “collective bargaining” for teachers.  I paid attention to how one had to “register republican” in the county in order to get a government job there. My county was a rich one, except for our steel town.

    I paid attention as I joined thousands encircling Rocky Flats to protest the creation of nuclear waste all through the mountains of CO where I had moved.  I paid attention as I went on strike there, for the second time, to keep the right wing here from taking away our right to bargain collectively.  And oh yea, I walked the lines even though it was my second year in CO and I DID NOT have tenure.

    I paid attention as people were duped by Reagan and the right.  And when Bill Clinton conceded on the right over welfare issues.  

    So I have been paying attention to politics for as long as I remember stretching back to the 1950s when I was a little girl.  

    And I do think there is a time for compromise. But there is also a time for fighting. IMO, this president, this senate has not fought hard enough.  The president has betrayed, imo, teachers the worst and still I was willing to support him, work for him knowing he was not on the same page with me when it came to education. I have sucked up that betrayal.  But this time, NO !  I want a fight and I will be supporting Bernie Sanders as he speaks out.

    I listened to the president today in the hope he would make me feel better about it all. He did not. When he said, and I quote, “I take John Boehner” at his word, I was deflated.  What will it take for this president and some senators, and some dems to get it?  This republican congress is filled with liars. Plain as day to me…they lie.  They are buoyed by the money of nuBirchers (Koch brothers, Murdoch et al) and these are people who are willing to let people die (Brewer in AZ), Cheney, for the sake of their pocketbooks.

    Obama may be well intended and simply naive as he seemingly believes these folks will work with him.  But imo he is wrong on this.  He is compromising with liars.  These are the same republicans that have railed against the deficit and now want to increase it exponentially for the sake of bzillionaires who outsource jobs to the slave labor sweat shops. These are the same republicans who goal is to destroy his presidency, destroy the rights of workers, and use the poorest and most ignorant to do it. No thanks.

    I may be in the minority here but I do not believe this compromise is in the best interest of anyone except the oligarchy.

    One more thing…perhaps obvious or perhaps not. I do not see how trashing other blogs contributes to anything. I already know how blogs can be. I remember the blatant sexism and ageism of some of the left blogs.  In the end, it doesn’t matter.  ALL of us have the right to rant against what we see as a mistake.  Doesn’t mean anyone hates the president or do not care about the unemployed.  It means we disagree and see a different solution needed.  

    I am all for helping my fellow citizens.   In the long run, I do not believe this is a good thing. In the short run, it helps a few (only some of the unemployed).  It is, imo, time for the left to fight harder.

  9. Peter Jukes

    I’m going to forget copyvio and just paste a big chunk, because it’s so tasty. Would love to know if Meese think he’s got this right:

    notice that Obama has secured – with Republican backing – a big new stimulus that will almost certainly goose growth and lower unemployment as he moves toward re-election. If growth accelerates, none of the current political jockeying and Halperin-style hyper-ventilation will matter. Obama will benefit – thanks, in part, to Republican dogma. So here’s something the liberal base can chew on if they need some grist: how cool is it that Mitch McConnell just made Barack Obama’s re-election more likely? Bet you didn’t see that one coming, did you?

    The mix of policies is also shrewd from a strategic point of view.

    At some point, I suspect, the Congress will have to decide between extending the payroll tax holiday or keeping the Bush tax cuts for millionaires – the double-track of the current Keynesian deal. I think Obama wins on that one, and has set up the kind of future choice the GOP really doesn’t want to make. What he has done, in other words, is avoid an all-out fight over short-term taxes and spending now in the wake of a big GOP victory in order to set up the real debate about long-term taxes and spending over the next two years, leading into a pivotal 2012 election that could set the fiscal and political direction of this country for decades, an election in which he may well have much more of an advantage than he does now.

    This is the difference between tactics and strategy. The GOP has won again on tactics, but keeps losing on strategy. More broadly, as this sinks in, Obama’s ownership of this deal will help restore the sense that he is in command of events, and has shifted to the center (even though he is steadily advancing center-left goals). It’s already being touted as “triangulation” by some on the right even as it contains major liberal faves – unemployment insurance for another 13 months, EITC expansion, college tax credits, and a pay-roll tax cut.

    My view is that if this deal is a harbinger for the negotiation Obama will continue with the GOP for the next two years, he will come into his own.

    The more his liberal base attacks him, the more the center will take a second look. And look how instantly the GOP’s position has shifted. They have suddenly gone from pure oppositionism to dealing with the dreaded commie Muslim alien, thereby proving he is not what they have made him out to be. The more often we get the GOP to make actual tangible decisions on policy alongside Obama, the less able they will be able to portray him as somehow alien to the country, and the more they will legitimize him. Their House victory means they can no longer sit out there, portraying the country as somehow taken over by radical, alien forces – which they can simply oppose with ever ascending levels of hysteria and rhetoric. And the more practical and detailed and concrete the compromises, the less oxygen blowhards like Palin and Limbaugh will have to breathe.

    Now for the short-term benefits of resolving this tax-and-spend dilemma so swiftly. The president urgently needs to get the new START and DADT through the Senate. DADT would be a major boost for his base – and the country’s military. Getting START through is critical to his foreign policy cred. If he can pull all this off by Christmas – and the Senate should indeed stay open for an extra week – the last Congress will indeed be viewed by historians as one of the most substantive (and liberal) in recent history. And Obama will have orchestrated it – while ending up firmly planted and rebranded in the center.

    Meep, meep.

  10. GMFORD

    Republicans have been whining that Obama never gives them a seat at the table while Democrats are moaning that he caves to them all the time.  Now that Obama has agreed to extending the tax cuts for the rich, Republicans seem to be all smiles.

    When the Healthcare Reform Bill was passed, the left was not happy that the public option was conceded to the Republicans.  However, from a Republican point of view, everything in the bill is stuff they don’t want.  There was only one thing they wanted in healthcare reform and that was tort reform which wasn’t included.  So from their point of view they got nothing.

    Stimulus?  Nothing there the Republicans wanted.

    Fair Pay Act? Pfft.

    Extracting money from BP for gulf cleanup?  That just embarassed the Republicans, made them apologize to BP.

    Pigford settlement?  Ha! How many black farmers vote Republican?

    Unemployment insurance renewal/tax cuts for middle class?  Republican voters are either fabulously wealthy or on social security (or both).

    Tax cuts for billionaires? Aha!    Finally something the Republicans really wanted.  A good sign that Obama is willing to reach across the aisle.

     

  11. jsfox

    A poll out this AM finds that a majority of both Democrats and Republicans like this deal

    http://www.gallup.com/poll/145…

    Two major elements included in the tax agreement reached Monday between President Barack Obama and Republican leaders in Congress meet with broad public support. Two-thirds of Americans (66%) favor extending the 2001/2003 tax cuts for all Americans for two years, and an identical number support extending unemployment benefits for the long-term unemployed.

    …

    Opposition Limited to the Extremes

    (like you couldn’t see that coming)

    Looking more specifically at the different ideological wings of each party, only liberal Democrats oppose extending the tax breaks for everyone: 39% are in favor, while 55% are opposed. Among the other groups, support ranges from 64% of conservative/moderate Democrats to 87% of conservative Republicans.

    Similarly, conservative Republicans are the only political/ideological group opposing the extension of unemployment benefits. The majority of moderate/liberal Republicans are in favor, as are most Democrats, regardless of ideology.

  12. Chris Blask

    Have I said that before? Feels familiar…

    Very bright guy who is often right about complex things. Unfortunately, he is extremely biased and assumes that being smart means he is always right, and he isn’t, which makes him a nob.

  13. spacemanspiff

    He’s been proven wrong on the majority of his predictions for this administration (and the Bush years for that matter).The guy writes so much crap that he’s bound to be right sometimes. But he’s not. He’s always wrong. If I had a nickel for every thing he’s been proven wrong on I’d cancel our debt with China and get a Nobel Prize for myself.  

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