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Is the Obama tax cut deal with Republicans fraying out of control already?

Democrat leader Harry Reid talks about the Senate lame duck agenda 12-8-10

Some folks may remember last winter when a rude Republican representative exclaimed "You lie!" during President Obama's State of the Union address. Speaker Nancy Pelosi was particularly perturbed.

Emotions now seem to be running high on the other side of the aisle. The target is the same president, but the exclaimer is a fellow Democrat.

During one of Pelosi's House party caucuses Thursday, Nevada's Rep. Shelley Berkley was making a fervent, if lonely, pitch to support the tax cut/unemployment extensions negotiated with Republicans by President Obama.

She was interrupted by a colleague exclaiming, "F___ the president!" Only, he said three more letters after the F.

The angry Democrat remains unidentified because, of course, the....

...party session was closed in the interests of government transparency. Berkley tried to brush off the incident, saying she didn't think the curse word was directed at her.

Following the outburst, the assembled Democrats, who remain a lopsided chamber majority until the new Congress takes over on Jan. 4 under a returning Republican speaker, John Boehner, held a nonbinding vote to reject the deal and demand more concessions from the GOP before agreeing to a vote.A happy Senate Republican leader Mitch McConnell

Wednesday, as The Ticket reported here, VP Joe "Effing Big Deal" Biden spent two hours apparently unsuccessfully trying to persuade the caucus to support the pact.

He left members with the impression that what the president had agreed on with GOP Senate Leader Mitch McConnell (photo, left) was not to be changed.

Having turned the Obama-McConnell deal into legislative language, the Democratic leader Harry Reid's disciplined Senate is close to voting on it.

It better hurry.

Because after a few days of chuckling and gloating over taking the Obama White House to the cleaners with the deal to extend, among other things, the Bush era tax cuts of eight years of failed policies fame, a number of prominent conservative voices are now awakening in opposition.

They've added up the costs of all the provisions, including 56 more weeks of unemployment insurance for millions.

And they realize that the total bill of the bill is larger than the original Pelosi-Reid stimulus bill's bill that accomplished so little. And they realize now that nearly a trillion new dollars will be added to the deficit that the newly elected GOP folks are coming to town to tame.

Charles Krauthammer has his take here, titled "Swindle of the Year." He writes: "Barack Obama won the great tax-cut showdown of 2010 -- and House Democrats don't have a clue that he did."

Melissa Clouthier has hers here at LibertyPundits.com titled "America is getting rolled. Again." She writes: The deal "had to be done NOW though, because the party is over for the Republicans and Democrats. Come January, the American people will be angered if they see Republicans spend like this."

According to a new Bloomberg News Poll out this morning, Americans are increasingly worried about the mushrooming size of the deficit and they'd really, truly like somebody to do something about it, maybe cut it way back or something like that, but without touching any entitlements, of course.

So good luck with that Santa list.

-- Andrew Malcolm

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Photos: Alex Wong / Getty Images (Reid); Harry Hamburg / Associated Press (McConnell).

 
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The Republicans should be demanding that the actual tax rates be cut. Bush's tax rates are 10 years old and have for more than five years now been factored into Congress's budget spending. Keeping them the same will not have much ability to 'stimulate' only by cutting the actual rates lower will that 'stimulate' anything. Also, if Congress is going to re-start the 'Death Tax' due to--as Weiner claims--the fact the to the heirs it is an 'unearned income', then the money that a college kid gets from home should also be taxed since there is no difference it is unearned income.

What is a Republican? A Republican is a person who hates the middle class, the poor, minorities and all immigrants. The Republicans want the entire population to be homeless, powerless and without medical insurance. The new big Republican project is to kick public school teachers out of the middle class and leave them destitute. The Republicans are seething at the amount of power the teachers' unions are exerting and they won't be happy until the unions have been destroyed. When is America going to wise up to the Republicans? We should be fighting them in the streets, not compromising with them. Mark Montgomery NYC, NY [email protected]

This decision has increased the likelihood Obama will be a one term president. He's kicked this can down the road into the middle of the next presidential election campaign and as a result Palin is not looking like such a long shot after all. Remember, no one does disinformation and propaganda better than the right wing especially with all the help they can get from their pals on the Supreme Court and MSM. This decision strengthens those beltway insiders that advocate tackling the deficit by the wholesale slaughter of existing programs. Obama should have let the Bush tax cuts expire and then sponsored emergency legislation to extend unemployment benefits and tax cuts ONLY for those under 250K and DARED the Republicans TO STAND IN HIS WAY by keeping them in Washington over the holdiays. Some say that Obama’s triangulating like Clinton. Well, it won’t work. Clinton had a stong economy on his back. Voters know that the Republicans screwed the world economy but they have short tempers and memories and the two party system isn’t going to save the day. Obama will get the blame for everything past, present and future. The long decline continues. The only thing left now is to get it over with and drown Amerika in the bathtub. Grover Norquist is laughing his fool head off. Starts to give meaning to that silly question we keep hearing from that nitwit Palin. How’s that hopey changey stuff?

The Bloomberg poll says all you need to know about America today. Don't raise taxes, don't cut spending and eliminate the deficit.

And bring me a pony for Christmas, too!

Most Americans just don't want the tax cuts for the rich extended period. All the other positions - deficits, payroll tax cuts, unemployment extension - are important to be addressed separately - but by far Americans are very, very angry that Republicans and their bosses (ie Wall Street, TBTF banks) are continuing to prosper while the middle class and the American Dream has been destroyed. Americans want revenge. We are willing to make sacrifices, such as no tax cut extension for ANYONE, as long as it results in higher taxes for the wealthy (that alone would get the country out of debt pretty fast). All this other stuff is a sideshow. Increase taxes on the rich, stop bailing out Wall Street instead of Main Street where the money would be better spent. That's what people want.

The problem with democrat's egalitarian policys is that egalitarian regimes
degenerate in equal poverty for all except for party bosses.Many dem congressman have an appetite for the return of the Stalin blood baths and the goulag.Socialism is democracy's greatest ennemy as the socialist dogmatic
elites believe they are the god-chosen sheppards of sheeps.(Lenin,Stalin
Castro,Chavez,Zapatero,Gordon Brown,etc.)

President Obama has placed the democrates in a" heads I win and tails you lose position".

Here's what I think they should do. Consider your health care and educational cost tax exempt when your marginal rate approaches 50%, Without a massive bureaucracy half of these bills get paid by the (other) taxpayers.

Thanks.

1. All persons residing in the U.S. shall come together in households for the purpose of reporting all income from any source, each item to be identified by payer's and payee's tax number. Members of a household need not be related, need not reside together, and a household may consist of as few as one person. With equality as the primary goal, this act established households to be taxed, so that all persons, whether related or not, legally here or not, are taxed equally.
2. Each year congress shall set by legislation a "minimum wage" and a "tax rate".
3. The following income shall not be subject to taxation:
• An amount equal to a year's earnings at the minimum wage rate, for each adult (age 20-65) member of the household, decreasing 10% per year to 50% at age 15 and increasing 10% per year to 150% at age 70. (Family of two adults and two young children would receive exemptions equaling 100% + 100% + 50% + 50% = 300% minimum wage, currently about $42,000)
• All payments for what is classified as necessary health care for all members of the household including medical care, any pharmaceuticals prescribed by a recognized health care professional, vision and hearing aids, and membership fees for health-enhancing entities such as gyms or other exercise facilities. Health care insurance premiums may be deducted but not health care expense paid for by such insurance.
• All educational expenses including day care for young children or legally incompetent persons, that portion of state and local taxes identified as spent on education, that portion of parochial school tuition, fees and other expenses identified as going for non-sectarian education, tuition, fees and educational materials for private school education at any level, and a per-diem allowance for students traveling more than 50 miles from primary residence for education.
• All income saved into an identified account from which investments may be made.
This encourages growth of the tax base, thus growth of the government's ability to pay for its responsibilities, by fostering health care, education and investment, all of which contribute to growth of income, taxable to support legitimate government purposes.
4. The "tax rate" shall be applied to any income over and above the deductions listed above, regardless of amount. It seeks the elusive concept of fairness by taxing at the same rate all "disposable" income.
5. There shall be no federal tax on corporations or other business entities. August 20th was declared the point at which we, on average, end working for government and start working for ourselves. This suggests a tax rate of 63%, which would create a backlash against big government that no amount of campaigning could evoke.
6. The Office of Management and Budget shall compute revenues to be expected using the newly set tax rate and minimum wage, applied to the previous year's reported incomes. No expenses in excess of that amount may be authorized or made by the federal government without approval by 75% of each house of Congress. It sets the Federal budget to produce a surplus in times of economic expansion and a deficit in times of contraction to promote economic stability.
7. At the request, by legislation duly enacted by a municipality having greater than 100,000 inhabitants or a state, a surtax may be imposed on citizens of that municipality or state which shall be applied in a manner exactly as applied for the Federal tax. It recognizes disparity in cost of living among various locations. It facilitates sufficient sources of revenue for states and municipalities.
8. For households whose deductions exceed total income, the Federal Government shall make payment equal to the tax rate multiplied by the shortfall in income, as shall municipalities and states. This addresses aid to the truly needy.
I would expect a tax rate in the neighborhood of 35-40%. Consider how it would affect your behavior, motivating you to save for retirement, and how it would, by exempting from this high rate, encourage spending on health care and education.

Your suggestions sincerely requested. E-mail them to [email protected]


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About the Columnist
A veteran foreign and national correspondent, Andrew Malcolm has served on the L.A. Times Editorial Board and was a Pulitzer finalist in 2004. He is the author of 10 nonfiction books and father of four. Read more.
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