Last week President Obama announced that he and congressional Republicans had reached agreement on a compromise that would extend the “so-called” Bush tax cuts for everyone. This same agreement would also extend unemployment benefits for an additional 13 months, raise the “Death Tax” to 35%- with a $5 million exemption and temporarily reduce the payroll tax rate by 2%.
Initially most Republicans were in favor of the deal, calling it a victory for everyone, despite the fact that neither the extension of unemployment benefits nor the payroll tax reduction were not paid for and most conservatives oppose the estate tax, since it taxes the same income and assets twice. For their part, liberal Democrats were and are furious, publicly attacking President Obama calling him weak and accusing him of folding too quickly.
Obama reacted to the criticism from his base by lashing out at liberals, calling them sanctimonious and telling them that they could reject the deal and have the “satisfaction of their purist position and no victories for the American people”.
Meanwhile, congressional Democrats like Rep. Anthony Weiner of New York attacked President Obama calling him the “negotiator-in-chief,” not the “leader of our country.” Others like self-described Socialist, Senator Bernie Sanders threatened to filibuster the bill after saying that Obama "effed up" by agreeing to the deal.
President Obama spent most of the week defending the deal in the media, holding 3 news conferences. He also dispatched Vice-President Joe Biden to Capitol Hill to convince Democrat members of the House and Senate to vote for the tax compromise. Biden told Democrats this was the best deal they could get and to take it or leave it.
Having made no headway in bringing his party around, and facing increasing attacks from his base, Obama took the extraordinary step of inviting former-President Bill Clinton to the White House to discuss the situation and ask for advice on how to proceed from a man who famously found himself with Republican majorities in both houses of Congress after the 1993 mid-term elections.
This move was a mixed bag for the current president. On the one hand Clinton said that he thought the deal Obama struck with Republicans was a good one and the best he was going to get in the current political climate. On the other hand a joint press conference with Clinton- which Obama left early, leaving Clinton alone in the White House Press Room- showed Obama to be weak, inexperienced and clearly over his head compared to the former-president. It also created a bizarre sense of déjà vu for many people, as Clinton continued to speak and take questions for nearly 30 minutes after Obama’s departure.
In addition, the news conference, when taken with the defiant rhetoric of outgoing House Speaker Pelosi made it apparent that political novice Obama, unlike most sitting presidents, is not the leader of his political party.
As if Obama didn’t have enough problems it now appears that many Republicans, having had time to more closely examine the deal- which is not paid for, are also opposed to it. This may have something to do with the fact that the Senate bill being floated by Majority Leader Harry Reid is filled with “sweeteners” intended to garner Democrat votes. Things like extensions of subsidies for windmills, bio-diesel and ethanol, as well as, tax credits for rum producers in Puerto Rico- all without any offsetting spending cuts- have ballooned the cost of the bill and caused many congressional Republicans and conservative commentators to reject the deal.
Conservative Charles Krauthammer wrote an article for the Washington Post on Friday, which President Clinton referenced in his press conference, where he says, “Barack Obama won the great tax-cut showdown of 2010 - and House Democrats don't have a clue that he did”. Krauthammer points out that what Obama actually has gotten is, “the biggest stimulus in American history, larger than his $814 billion 2009 stimulus package”.
There are now many Republicans, especially those that will be sworn in on January 5th, that believe it would be better to let the current tax rates expire on January 1st and then retroactively cut them in the 112th Congress when they take power.
The president accused Republicans of holding tax cuts for the middle-class hostage, saying: "We all know that the middle-class tax cuts were being held hostage to the high-end tax cuts. It's tempting to not negotiate with ‘hostage takers,' unless the hostage gets harmed. In this case the hostage was the American people." This statement is disturbing both because he compares Republicans standing on principle to “hostage takers” and because it might give actual terrorist hostage takers- like Al Qaeda or the Taliban- the idea that if they threaten to harm or kill their hostages Obama might negotiate with them.
But the reality is Obama and the Democrats got a much better deal this week, at least from their perspective, than they will ever get next year- even if they’re too blinded by their ideology to realize it. If the lunatic-left of the Democrat Party attempts to push what Krauthammer calls “Stimulus II” through the lame duck session of Congress this month, they will fail because not enough members of their own caucus are onboard. Then they will be dealt a huge political defeat in January as Republicans pass tax cuts for everyone, without an expiration date.
President Obama, every House Democrat and the 2/3 of Senate Democrats running for reelection in 2012 will be forced to not only defend their NO votes on cutting taxes, but they will actually have to run on the raising taxes in 2 years.
What started out as a botched deal, agreed to by Republicans, that could have been a huge political trap for the GOP has turned into a potentially major political fiasco for the president, instigated by the far left ideologues in the Democrat Party. Of course this assumes that the Republican leadership doesn’t cave and accept the pork-laden bill currently being presented as a compromise by Obama.