The reaction to the tax deal announced last week has been all over the map. Pundits and politicians on both sides love it and hate it. There is anger on both sides — one Democrat Congressman even said “F**k the president” — and the only person who seems bored by it is President Obama, who could not be bothered to hang around a press conference held with Bill Clinton. He departed to attend a party with his wife, leaving the unfortunate impression that the former president is more engaged than the current specimen. Bookworm summarizes the range of reactions well.
Charles Krauthammer calls the deal “the swindle of the year” that will “blow another near-$1 trillion hole in the budget.”
At great cost that will have to be paid after this newest free lunch, the package will add as much as 1 percent to GDP and lower the unemployment rate by about 1.5 percentage points. That could easily be the difference between victory and defeat in 2012.
Obama is no fool. While getting Republicans to boost his own reelection chances, he gets them to make a mockery of their newfound, second-chance, post-Bush, Tea-Party, this-time-we’re-serious persona of debt-averse fiscal responsibility.
And he gets all this in return for what? For a mere two-year postponement of a mere 4.6-point increase in marginal tax rates for upper incomes. And an estate tax rate of 35 percent – it jumps insanely from zero to 55 percent on Jan. 1 – that is somewhat lower than what the Democrats wanted.
Chris Kobus says Krauthammer falls into the liberal trap of arguing that tax cuts “cost the government.”
Rep. Paul Ryan is for the deal, but Senator Jim DeMint opposes it:
I’m glad the President recognizes that tax increases hurt the economy. I mean, I guess that’s progress. But frankly, Hugh, most of us who ran this election said we were not going to vote for anything that increased the deficit. This does. It raises taxes, it raises the death tax. I don’t think we needed to negotiate that aspect of this thing away. I don’t think we need to extend unemployment any further without paying for it, and without making some modifications such as turning it into a loan at some point. It then encourages people to go back to work. So there’s a lot of problems with it. I mean, and frankly, the biggest problem I have, Hugh, is we don’t need a temporary economy, which means we don’t need a temporary tax rate. A permanent extension of our current tax rates would allow businesses to plan five and ten years in advance, and that’s how you build an economy.
When I hear about deals with the Democrats called swindles, I think of Reagan’s famous deal in the 1980’s. He gave the Democrats a tax rise in exchange for $2 of spending cuts for every $1 in tax increase. America got the tax increase; the spending cuts never came. By the end of the Reagan presidency federal spending had doubled.
In the current deal Republicans don’t even ask for the promise of spending cuts.
All my life government spending has only grown. Somehow these compromises always work to the advantage of the statists. The Democrats say, “Let’s do X.” The Republicans respond with, “Let’s just do half an X.” They work out a compromise and we end up with less freedom.
As I see it, this deal probably is the best the Republicans could manage with a leftist president, but that doesn’t mean it’s a good deal. It’s pretty much more of the same. We need a 180-degree change in direction: cut spending, cut taxes, cut regulations, cut the size of government. That’s just for starters.
The left is screaming about this deal because Obama gave up a tax increase on the rich. What we need is a deal that would turn their screaming up to 11. We need a deal that would not only bring back their fantasies of moving to Canada, but would actually make a good lot of them move there.