The Warning Bell of Democratic Stupidity

Any sentence that starts with “But some in the Senate” is guaranteed to contain something stupid from Democrats. Here’s today’s example from Ezra Klein:

[…]House leadership is still looking to hold a standalone vote on the tax cuts for income under $250,000. But some in the Senate — including Chuck Schumer, Bob Menendez, and Claire McCaskill — are pushing a compromise that would extend $400 billion of the $700 billion in tax cuts for income above $250,000 by extending them for everyone making less than $1,000,000. So those struggling members of the middle class making between $250,001 and $999,999 will get their tax cuts, too, and Democrats will have extended about $3.6 trillion of the $4 trillion in Bush tax cuts, or 90 percent of the total.

If that’s the ultimate agreement we see on the Bush tax cuts, it’ll be worth taking a moment to appreciate how far Democrats have backslid on this issue since BIll Clinton. Clinton, of course, raised taxes in the face of large deficits. The Obama campaign, by contrast, swore not to raise taxes on any family making less than $250,000, and Democrats might now effectively raise that to $1,000,000. In setting up the expectation that taxes can’t go up for anyone but millionaires, Democrats take most of them off the table. And given that Republicans have no interest in taxes, either, that basically removes them as a tool of fiscal policy going forward.

Also, too: if it starts with “But some in the Senate” and contains “Chuck Schumer”, it’s some kind of sell-out to the rich, corporate interests, or both.

82 replies
  1. 1
    Odie Hugh Manatee says:

    When it comes to relief from the tax man, according to the rich it’s “one for you, nineteen for me”.

  2. 2
    srv says:

    It’s always best to surrender early.

  3. 3
    lawguy says:

    I wish these stories would make clear that EVERYBODY gets a tax cut on all income under $.250,000.00. So milionaires get a tax cut on their income that is under $250,000.00 just not on the amount over that.

  4. 4
    ChrisS says:

    Next week Obama is going to bomb the shit out of Iran so that the GOP will play nice with him.

  5. 5
    Matt says:

    Ah, fuck it. Just give us the FairTax and be done with it already.

  6. 6
    ChrisS says:

    Can’t pay federal employees, cut state jobs, slash and burn the budgets. What we’re seeing is America’s labor costs backsliding to equalize with global labor supply. Just wait until gas prices hit $4.50/gln this summer.

    But tax cuts will solve everything!

    Zombie Reagan is still very much alive despite thirty years of supply side failure. God Bless America.

  7. 7
    BH says:

    It is important to point out that those making over one million dollars in a given year are most likely multi-millionaires.

    The framing on this issue has slid so far to the right, it’s beyond ridiculous.

  8. 8
    Sanjuro says:

    Ahhhhh, the irony of Ezra’s comment on the middle class members who are struggling to make ends meet with only a paltry 250K plus income. It makes one want to weep profusely.

  9. 9
    cleek says:

    @lawguy:
    i’d bet that 80% of Americans have no idea how our income tax system works, or what a marginal rate even is.

  10. 10
    geg6 says:

    Fuck it. Let’s just make it so that all of our paychecks are automatically deposited into the various half-millionaire’s and millionaire’s bank accounts. That will save us all the bullshit we’re gonna have to listen to in order for them to do it through the back door. Let’s just be up front and give it all to them and be done with it.

  11. 11
    Alex S. says:

    Hmm…. we’ll have to change the tag to “53-47 superminority”.

  12. 12
    RalfW says:

    It may be time for mass numbers of Democrats to join the Tea Party. I’m joking, and yet, not.

    I don’t believe that the astroturf/Koch/Dick Armey type Tea Party crapola is particularly valid, but if Democrats are not willing to raise taxes back to Clinton levels during a jobless, plodding recovery that features record profits for business, then, heh, we may as well demand massive cuts to government, too, because it’s fiscally fraudulent to go along with the Republican starve the beast strategy.

  13. 13
    Mike Kay (Democrat of the Century) says:

    Using very rough, preliminary numbers, they concluded that the ten-year cost of extending tax cuts for incomes below $250,000 was $3.2 trillion and that the cost of extending cuts for incomes less than $1 million was $3.6 trillion. In other words, the higher threshold would cost an additional $400 billion over ten years.

    I don’t think these numbers are correct.

    Remember Bush’s tax cut when passed in 2001 was 10-year $1.35 trillion. If the rates remain the same, how would those very same tax cuts go from 1.35 to 4 trillion, when income has been stagnant through out the past decade.

    Moreover, the progressve Center for Tax Justice said the 37.6% of bush tax cuts went to people averaging $1.1 millions income, while Ezra and Cohn’s say only 10% if the bush tax cuts went to millionaires.

    http://www.ctj.org/html/gwbfinal.htm

  14. 14
    p.a. says:

    point 1: once-a-fucking-gain, is there any Democrat out there
    with the wit to make the public argument that everyone gets a tax break, including people making over $250k, on the first $250k. Frame the issue like that, for christ sake.

    point 2: i used to think that republicans were craven, cynical,
    reality-denying tools of religious kooks and economic interests. but given the clueless responses of democrats (for the most part) since they took over congress, maybe they are all, republicans and democrats, just morons. they make a good case for increasing the inheritance tax exponentially.

    (pls don’t quote the accomplishments of, what is it, the 111th congress? and the admin. to me. i know, i know. but how ’bout standing up for what they have accomplished, instead of playing ‘duck and cover’ when the rep/fox bullshit starts flying. it’s almost as if they’re ashamed of what they’ve accomplished.)

    post script: any thoughts on Barry Ritholz’s idea that focusing on HCR before economic recovery was a strategic mistake? Hindsight 20/20 of course, i think a strong argument can be made there.

  15. 15
    geg6 says:

    @p.a.:

    post script: any thoughts on Barry Ritholz’s idea that focusing on HCR before economic recovery was a strategic mistake? Hindsight 20/20 of course, i think a strong argument can be made there.

    I don’t even understand why this is a question. Who says it had to be either/or? Why couldn’t they have tried to do both? Can’t anyone in this country multi-task?

  16. 16
    Suck It Up! says:

    I seem to remember some cheering on the left for Schumer to become Senate majority leader should Reid lose his re-election.

  17. 17
    James Gary says:

    I don’t think these numbers are correct…Remember Bush’s tax cut when passed in 2001 was 10-year $1.35 trillion. If the rates remain the same, how would those very same tax cuts go from 1.35 to 4 trillion, when income has been stagnant through out the past decade.

    Good observation. It should be worth noting, however, that the people at the top of the food chain are a LOT richer than they were ten years ago. Probably not three times richer, though…I am curious to see Klein’s calculations.

  18. 18
    Morbo says:

    I think they have the right idea in theory. There probably need to be more tax brackets to better reflect the inequality of growth that we’ve seen over the past few decades. As for whether or not any of those potential new brackets should get to keep their Bush tax cuts: lol, no.

  19. 19
    terraformer says:

    At some point, one has to recognize that our Democratic representatives simply don’t want to increase the tax burden on rich people.

    People Party vs. Money Party, etc.

  20. 20
    Suck It Up! says:

    @p.a.:

    post script: any thoughts on Barry Ritholz’s idea that focusing on HCR before economic recovery was a strategic mistake? Hindsight 20/20 of course, i think a strong argument can be made there.

    sorry, ain’t buying that argument.

  21. 21
  22. 22
    Mike Kay (Democrat of the Century) says:

    @p.a.:

    any thoughts on Barry Ritholz’s idea that focusing on HCR before economic recovery was a strategic mistake?

    In general it is easier to expand services during a period of relative prosperity, low unemployment and low deficits. But how long is it gonna take before we see that again, maybe 5 years, maybe 12 years. And then how often does the party have a filibuster proof majority (last time was 32 years ago).

    Progressives have been targeting HCR for 110 years. Think of that – 110 years. And no matter who was president, T.R./FDR/Truman/LBJ/Nixon/theClintons, they all failed.

    Did we really want to wait another 15 to 20 years for the stars to align, and then who knows if an economic crash or a war wouldn’t intervene and ruin that prospective moment.

    It really is a miracle that Obama got HCR passed during this depression, when FDR, Truman, and LBJ couldn’t under more favorable political circumstances.

  23. 23
    PeakVT says:

    As you can see here the bottom of the 95th percentile is $180,000, and the bottom of the 90th percentile is $138,000. If you’re doing better than 90% of the country, you’re not “middle-class” by any definition. Taxes should be raised on everybody at or above the 90th percentile, with additional brackets at $1M and $10M.

  24. 24
    liberal says:

    @Suck It Up!:
    Anyone in the educated left would already know that Schumer, while liberal on some issues, is an unforgivable shill for Wall St. and Israel.

  25. 25
    JAHILL10 says:

    @Mike Kay (Democrat of the Century): Besides, wasn’t the stimulus passed BEFORE HCR? Maybe it wasn’t as big as it should have been, but it wasn’t like the White House ignored economic recovery either.

  26. 26
    Mike Kay (Democrat of the Century) says:

    In any event Congress should be pressured for a vaunted CBO analysis before any extension.

  27. 27
    dirge says:

    @lawguy:

    I wish these stories would make clear that EVERYBODY gets a tax cut on all income under $.250,000.00.

    Also, a pony.

    On the upside, this splits the top bracket into two: the very well off versus the indefensibly wealthy. While the very well off don’t need any help, I’d be willing to throw them a bone if it means that in the future we can raise taxes on the indefensibly wealthy without hearing about “middle class small business owners.” Politically, I think that could be a huge long term win, aligning the interests of the working wealthy with the working everybody else, against the multi-millionaire ownership class. Really, there are people who work for their half million dollars a year, whether they deserve that much or not, and how you come by your money can matter a lot in political terms.

    So, if I trusted that Chuck Schumer, Bob Menendez, and Claire McCaskill were pushing this as a clever plan to shift the debate over the long term, I’d be in favor of it. But I don’t think that’s what they’re doing.

  28. 28
    martha says:

    @cleek: 80%? You’re being kind. Hell, the wingnuts who work for me don’t have a clue and they bitch to high heaven ad nauseum. We hippies, of course, know the exact percent we pay, every year. They’re just lazy asses.

  29. 29
    liberal says:

    @PeakVT:

    If you’re doing better than 90% of the country, you’re not “middle-class” by any definition.

    BS. The point isn’t “who is middle class?” Rather, the point is “who is rich?”

    A couple making $250,000 in an expensive urban area is admittedly relatively well-off, but in the absence of considerable assets hardly belongs to the filthy, parasitic rich.

    Finally, this focus on incomes is just stupid. While it might be harder to get data on actual assets, and while the debate tends to focus on incomes because of the IRS, “rich” is defined by “wealth,” which in turn is defined by net assets, not income.

    IMHO someone is “rich” if they could live a very nice life without ever working again, and at the same time purchase enough insurance to be free of fear of financial disaster. $250,000/year in an expensive urban setting for a couple with children ain’t gonna cut it.

  30. 30
    Corner Stone says:

    @Morbo:

    There probably need to be more tax brackets to better reflect the inequality of growth that we’ve seen over the past few decades.

    I agree. Let’s make the top bracket 90%.
    From 250,000 to 1M = 39%
    From 1M to 10M = 50%
    From 10M and up = 90%

  31. 31
    liberal says:

    @Mike Kay (Democrat of the Century):

    And no matter who was president, T.R./FDR/Truman/LBJ/Nixon/theClintons, they all failed.

    LBJ failed? LOL.

  32. 32
    WyldPirate says:

    @Mike Kay (Democrat of the Century):

    It really is a miracle that Obama got HCR passed during this depression, when FDR, Truman, and LBJ couldn’t under more favorable political circumstances.

    Enjoy HCR–such as it is–while you can. The Rethugs are going to chip away at it until there is nothing left of it, and thats if the courts don’t dismantle part of it first.

    Look for some “Democrats” to join in and help, too. The slack-jawed, idiot electorate will support dismantling something that will help them or will simply be too absorbed in some TV idiocy to notice.

  33. 33
    liberal says:

    @Corner Stone:
    More important than the brackets is the definition of taxable income.

    The reason the filthy, stinking, parasitic rich don’t pay taxes isn’t because the marginal rate is too low; it’s because what they earn steal is, by and large, left out of taxable income.

  34. 34
    JAHILL10 says:

    @dirge: At some point our elected officials have to acknowledge and address the vast gap between the have nots and the have lots in this country. This is a golden opportunity to do so. If the rich are sitting on their piles of cash and not hiring because they are worried about HUGE government deficits, then letting the tax cuts on them expire would go a long way toward fixing that problem. It’s as simple as that. Rhetorically speaking, we’ve to to stop letting them have it both ways.

  35. 35
    Corner Stone says:

    @liberal:

    Finally, this focus on incomes is just stupid. While it might be harder to get data on actual assets, and while the debate tends to focus on incomes because of the IRS, “rich” is defined by “wealth,” which in turn is defined by net assets, not income.

    What happens to wealth and assets assigned to a trust? The individual gets all the benefit but none of the responsibility.
    Treat cap gains the same as income. Let a 50% estate tax take care of the rest.

  36. 36
    LarsThorwald says:

    I have just started in on Robert Caro’s excellent three-volume series on LBJ, and he doesn’t cut corners, going back to LBJ’s grandfather and (where I am now) his father’s role as a legislator in the Texas statehouse.

    What is not surprising to me is the fact that monied interests have always worked their persuasive magic,going back and back. Caro writes about how the lobbyists in Texas (and this is in the early 1900s) used to have accounts that legislators could use to buy the three B’s: Beef, Bourbon, and Blondes. Hell, there used to be open accounts that legislators could run their charges to, and the tabs would be picked up by lobbyists, and these were accounts at whorehouses.

    So the fact that lobbyists and the powerful rich used to grease palms is a well-entrenched reality of this nation is nothing surprising.

    What is surprising is the fact that there were state legislators — such as Sam E. Johnson — who would reject that kind of graft out of hand, and regardless of the consequences to themselves, would stand up and take principled stands for those things that were good for the people, or against those things that were bad for the people.

    Caro recounts how during the outbreak of World War I there was a feverish anti-German rage running through the nation, and in Texas steps were taken to enact a law that would make any commentagainst America, even in casual conversation, punishable as a crime, along with other anti-German measures (banning the teaching of German, etc.).

    Caro writes that on the day the bill came to the floor the galley was packed with angry Texans who loudly demanded passage of the bill. And he writes that lanky Sam Johnson took to the floor and gave a barn-burner speech against the bill. And he worked behind the scenes to get it killed.

    Sam Johnson was a Populist at heart, even twenty years after the Populist party was dead and buried. And Johnson and a handful of men in the statehouse knew that they fought losing battle after losing battle, eating beans on their paltry salaries while other legislators ate steak and drank whiskey on the dime of lobbyists.

    One time a frustrated compatriot of Johnson’s half-jokingly asked why the Hell they didn’t just surrender. And Johnson responded that the things worth fighting for are worth fighting for in their own right. Win or lose.

    That was 100 years ago. And I wonder now, as I look to my own party, where the Sam E. Johnsons are. Where are the men who will stand up and say, “No, it’s not right that the burden of sacrifice should fall to those least able to bear it while those who enjoy the greatest privilege sacrifice little.”

    I worked for President Obama in four states. I saw in him a man who could follow that path. A man who could see the benefit of compromise, but who would not, when compromise failed, back away from principle.

    There comes a point where compromise on policy equals compromise of principles.

    Compromising to allow the very wealthiest in our nation to benefit while those who can bear the burden least — of those who are caught in the tentacles of circumstance — is a compromise not only of policy. It is also a compromise of the very principles that used to form and should remain the bedrock foundation of the Democratic Party.

    It absolutely pains me to say this, but if he compromises that away and capitulates to the Republicans on the issue of the tax cuts, he has lost me.

  37. 37
    Punchy says:

    @Matt: Missouri is itchin’ to enact the fair tax in place of a state income tax.

    What I wouldn’t do right now to open up a business just over the border on the Kansas side….the traffic/profits would be mind-blowing.

  38. 38
    liberal says:

    Addendum: doesn’t mean I think a household making $250,000/year can’t afford to have its income taxes increased (especially on the marginal income over the bracket). But creating a higher bracket for millionaires (regardless of the rates set for both brackets) is IMHO a good idea.

  39. 39
    Jamie says:

    And another bold Democratic plan to snatch defeat from the Jaws of victory is deployed.

  40. 40
    liberal says:

    @LarsThorwald:

    I saw in him a man who could follow that path. A man who could see the benefit of compromise, but who would not, when compromise failed, back away from principle.

    Where did you see that? If you’d bothered to consult his e.g. ADA voting score from his time in the Senate (Americans for Democratic Action), you’d have known in advance that he was about as liberal as Hillary, and hardly that liberal over all.

    Not to mention stuff like getting more campaign dollars from the vampire squid than any other candidate.

  41. 41
    Corner Stone says:

    @PeakVT:

    If you’re doing better than 90% of the country, you’re not “middle-class” by any definition. Taxes should be raised on everybody at or above the 90th percentile, with additional brackets at $1M and $10M.

    I recently kept prodding my winger friend to define for me who was and was not middle class. He refused to draw any line. To him, being a top 5% earner did not qualify you as “elite”.
    So apparently earning $1M or more a year still qualifies you for middle class status.

  42. 42
    liberal says:

    @Corner Stone:
    Not gonna disagree on any of that. The disparate impact of the treatment of cap gains and income are exactly what I have in mind, but I’m sure that it goes well, well beyond that.

    The best thing to tax, actually, is land (as in land value, not acreage); it’s disproportionally held by the rich (especially valuable commercial land); it cannot be hidden from tax authorities or spirited overseas; and income from land itself is all ill-gotten gains. People aren’t going to listen to that in the aftermath of a huge land bubble crash, though. (And it most definitely was a land bubble, not a housing bubble.)

  43. 43
    Agoraphobic Kleptomaniac says:

    So those struggling members of the middle class making between $250,001 and $999,999 will get their tax cuts,

    I wish I could “struggle” like that. Also, Ezra gets a poke in the eye for phrasing it that way, since those people will get a tax cut on the first $250,000 as well.

  44. 44
    Dennis SGMM says:

    Raising the top marginal tax rates to some sane level would be a good thing. So would raising the cap gains tax because a substantial portion of the money being made in this country is now capital gains. Unfortunately, as both lawguy and cleek already mentioned, Americans don’t understand marginal tax rates. Any proposal to raise taxes on the top 10% of earners would be filtered through the Wurlitzer and the idiocracy would then be convinced that they’d be taxed at 90%.

  45. 45
    PurpleGirl says:

    @liberal: Yup, that he sure is.

  46. 46
    balconesfault says:

    By the way … it doesn’t take making a million a year to be a millionaire.

    A person with a million a year income is probably likely to have $10 million or more in assets. They’re multi-millionaires. They are so wealthy that they could live without working in perpetuity on $100 grand a year simply off interest, even at today’s paltry interest rates, and never see a decline in their net wealth.

    One can argue that the current tax structure is actually an incentive for these people NOT to work.

    Meanwhile, there are probably an awful lot of millionaires who make $250,000 a year – especially given the incredibly low tax rates we’ve had over the past decade.

    The argument here is about structuring the tax code to concentrate more wealth in upper brackets – at the same time America is clearly suffering because so much of our national wealth is tied up in the hands of the upper brackets.

    During the 00’s, the middle class was able to keep up their spending by borrowing more, even if that meant putting their home at risk to borrow. We need to shove more of society’s wealth downward to prosper.

  47. 47
    Suck It Up! says:

    @liberal:

    You would think. I was certainly surprised to see so many wanting him to be majority leader. their main reason: he’s got gutzzz!!

  48. 48
    WyldPirate says:

    @Corner Stone:

    Treat cap gains the same as income. Let a 50% estate tax take care of the rest.

    Dream on.

    Cap gains treated as income? Please. How then will our economic betters and “small business men and women” (yeah Rethugs will add them and the idiot electorate will fall for it) manage to then “invest in America and create good-paying jobs”? How then will the give us the “golden showers” of their daring risk via investment?

    Inheritance tax? There is none this year. Look for it to remain that way through the rest of the next two years at least. We can’t expect our small business and our economic superstars to work hard and steal if they can’t leave it completely sheltered and untaxed to their spawn.

  49. 49
    liberal says:

    @Corner Stone:

    Let a 50% estate tax take care of the rest.

    Big problem with the estate tax isn’t the rate (though I have nothing against a 50% rate). It’s that it’s completely porous to anyone who can find and pay for a good lawyer. I don’t know the exact mechanisms, but my impression is that the assets are inserted into an insurance wrapper or something.

  50. 50
    PeakVT says:

    @liberal: Somebody making $250K is very well-off everywhere in the country. But talking about specific amounts is a distraction because people will always want to move the cutoff points around. If somebody makes more than 90% of the country, they aren’t in the middle of anything. Call it upper middle-class, or working wealthy, or whatever, but those people are a very different position than somebody making the median, which is $50K.

  51. 51
    p.a. says:

    @Mike Kay (Democrat of the Century): and others. i think ritholz’s point was that turning the economy around FIRST would have been a far better use of the dems’ political capital (retching sound) at the time, since an improving economy could have cemented the dem. congressional gains of ’06/’08, and then enabled reform of hc, dadt, doma, carbon issues etc.

  52. 52
    Mike Kay (Democrat of the Century) says:

    @liberal: yeah, I don’t know what history books you have, but LBJ did not pass HCR.

    in fact when medicare passed, US life expectancy was 69 years. today, it’s in the late 70s. So there you have it. when he passed medicare, on average, merely provided 4 years of service and with no drug coverage. Now, it’s gotten better and more people are covered as life expectancy has extended from advances in medicine and life styles, but not at the beginning.

  53. 53
    Mudge says:

    I am sitting here imagining anyone earning $1,000,000 a year going from paycheck to paycheck. Doesn’t compute. Even the facile argument “but some live in New York City” that is used for the nominally over $250,000 earners loses all traction.

    All of these folks have one objective, to accumulate wealth. At some point below $250,000 the objective is to pay the bills. That value, whatever it is, should be the cutoff.

  54. 54
    Judas Escargot says:

    @ChrisS:

    Zombie Reagan is still very much alive despite thirty years of supply side failure.

    It hasn’t been a failure at all, from the point of view of the supply side.

    Not sure how they expect the game to continue once they’ve managed to destroy all demand, though.

  55. 55
    Mike Kay (Democrat of the Century) says:

    @p.a.: on the other hand, if obama had said, we’re scrapping HCR until the economy recovers, the base would have staged a revolt and the net effect would have been the same as 1994.

  56. 56
    WyldPirate says:

    @LarsThorwald:

    It absolutely pains me to say this, but if he compromises that away and capitulates to the Republicans on the issue of the tax cuts, he has lost me.

    Watch out Lars. The Obots are sharpening their fangs.

  57. 57
    Earl Butz says:

    @LarsThorwald: Caro’s books should be required reading. Johnson was an SOB. That being said, he always found a way to help the little guy, even sometimes forgoing opportunities to line the pockets of his contributors to do so. They don’t make them like that anymore.

    Compromising to allow the very wealthiest in our nation to benefit while those who can bear the burden least—of those who are caught in the tentacles of circumstance—is a compromise not only of policy. It is also a compromise of the very principles that used to form and should remain the bedrock foundation of the Democratic Party.

    Ought to be chiseled in stone as a bedrock commandment of the Democratic party. Perhaps we could try “thou shalt not fuck over the poor”.

    It absolutely pains me to say this, but if he compromises that away and capitulates to the Republicans on the issue of the tax cuts, he has lost me.

    I’m curious. He’s already capitulated to monied interests, time and time again (banks, HCR, etc.), allowing them to line their pockets while doing nothing for the little guy. Why is this your Rubicon?

  58. 58
    Corner Stone says:

    @p.a.:

    i think ritholz’s point was that turning the economy around FIRST would have been a far better use of the dems’ political capital (retching sound) at the time

    IMO, there was no reason not to move forward with HCR early in the Congress. Kennedy was still relatively ambulatory, and Byrd wasn’t quite at death’s door, IIRC.
    The disaster was letting it draw out over a year+. The secondary disaster was setting it up so the bulk of beneficial results do not kick in until 2014.
    Get it done in a reasonable time period. Roll it out to the people so they can see all the lies the GOP spread about it were untrue. Then dare the GOP to run on repealing it.
    Additionally, IMO implementing HCR on a quicker timescale would have been stimulative for the economy.

  59. 59
    PeakVT says:

    @Corner Stone: Baucus dragging out the “negotiations” in his little group was the big mistake IMHO, though I’m not sure if there is a Senate rule that allows a bill to bypass the relevant committees.

  60. 60
    Corner Stone says:

    @liberal:

    It’s that it’s completely porous to anyone who can find and pay for a good lawyer. I don’t know the exact mechanisms, but my impression is that the assets are inserted into an insurance wrapper or something.

    I don’t know the details about this tactic either. But if true, I wonder why the wealthiest 18 families in the US have spent 100’s of millions trying to kill this tax?
    Maybe the wrapper can only shield so much. Then it’s 50% baby!

  61. 61
    p.a. says:

    @Corner Stone: i tend to agree with your view myself, but since it objectively did not happen this way, i wonder if ritholz’s idea would have been better in the end. (my original question way back when in this thread.) one argument i can see against the ‘fix the economy first’ meme is the fact that during flush times hcr motivation has tended to recede from public consciousness.

    i’d have to go back, maybe into tpm’s archives, to see what they were thinking in dragging the main reforms out ‘tlll 2014. it’s baffling.

  62. 62
    Bulworth says:

    Yes but we’re saving $5 bill by freezing fed salaries, so $4 trill or so tax cuts can be extended safely without impacting the deficit.

  63. 63
    catclub says:

    @cleek:
    It’s actually 87%. The rest are just innumerate.

  64. 64
    FlipYrWhig says:

    @p.a.: I don’t think it’s a very good argument, mostly because it imagines “fixing the economy” being something that doesn’t itself fall prey to demagogues and know-nothings whipping up fear and craziness.

    Also, I know that have well-established Obot tendencies, but this article itself points towards Senate Democrats being weasels, and yet a big chunk of the comments want to blame Obama. If Senate Democrats feel like being weasels, how is Obama supposed to stop them? Every time there’s a Democratic president, suddenly the rest of his party decides that they’re pretty much co-presidents, dicking around and making things complicated. But the legislature is where these things get hashed out. Everyone wants Obama to crack heads and make “the Democrats” stop acting stupid, but, still, and I’ve raised this plenty of times before, _how_? Now, predictably, someone will say, “He doesn’t even try!” or “bully pulpit!”

    I still think that there really isn’t a lot any president can do to stop his own party from undercutting him if they’re so inclined, and that tendency has been worse with Obama because a big swath of his own party’s office-holders think he’s too young and/or too far to the left and/or too far to the black.

    And the idea of freezing wages for public employees is still stupid.

  65. 65
    FlipYrWhig says:

    @p.a.:

    i’d have to go back, maybe into tpm’s archives, to see what they were thinking in dragging the main reforms out ‘tlll 2014. it’s baffling.

    IIRC, they wanted to improve the CBO score for the first ten year chunk by counting some cheaper years up front. And that was probably important for getting votes from non-liberal Democrats who worry about either big spending or being tagged as “big spending.”

  66. 66
    Corner Stone says:

    @p.a.: I would argue that “fixing the economy” is a decidedly more drawn out process than passing any one piece of legislation, even a grand one like HCR.
    By the time people could actually start unclenching their sphincters regarding their financial stability and the “economy” as a whole it would most likely be time to ramp up for the 2012 elections.
    Not to mention that it would have taken a series of legislation and other steps to properly situate the economy to start getting it’s feet again. And there was little or no stomach for that kind of process among conservative Democrats, and zero amongst Republicans.

    So on the whole, my answer remains that HCR was worth doing early. It just acted like a bouncing betty on them.

  67. 67
    FlipYrWhig says:

    @Corner Stone: Agreed on policy. I think there’s a better case to be made for having started by coming out swinging against investment banks and their bullshit — but even there I see public opinion shifting, as it did on HCR, where initial widespread approval of kicking some corporate ass could be made by propagandists into at least half the country ranting about redistribution and socia1ism.

  68. 68
    El Cid says:

    @Judas Escargot:

    Not sure how they expect the game to continue once they’ve managed to destroy all demand, though.

    If you rob and clean out enough big bank vaults to last yourself a lifetime, why care about whether or not there are still bank vaults filling up to rob later? Or so that others like you can rob later? Dude, IGMFY.

  69. 69
    El Cid says:

    @Dennis SGMM: Yep. The number of times I’ve spoken with My Fellow Americans about X% marginal tax rate for Y bracket, they think it’s like a trap springing once you cross some line — step over $Z, and all of a sudden they gon’ take 90% of all yer munee!

  70. 70
    Corner Stone says:

    @FlipYrWhig: The failure to deal with the banks in any meaningful way will, I hope, go down in the history books as the spectacular debacle it was and is.
    IMO, making banks take a haircut off the top and restructuring some terms on compensation deals would have been hugely popularly. And could have been a solid foundation for Democratic talking points.

  71. 71
    sukabi says:

    it’s my understanding that the $$ folks earn below $250K is subject to the tax cuts… so with this proposal the folks earning $$ ABOVE $250K but under $1M will get additional tax cut revenue IN ADDITION TO the tax cut on their FIRST $250K… this is just more handouts to those that don’t need it.

  72. 72
    FlipYrWhig says:

    @Corner Stone: I think it would have been hugely popular initially, then gotten bogged down as Fox Nation learned that capitalism itself was at stake and Democrats just wanted to punish success. “Keep Big Government out of My Bank Account,” that sort of thing. I don’t think any effort to do anything that makes rich entrenched interests less arrogant and comfortable would _remain_ as popular as it would begin. At this point I think any entity with a lot of money can count on persuading at least 45% of America to take its side through crafty gamesmanship and switching the discussion to standards from the Great Republican Songbook like “Democrats don’t care about national security,” “Democrats wage class warfare,” and “Democrats want to take your money and give it to a black guy with gold teeth named Da’quawn.”

  73. 73
    Nick says:

    Chuck Schumer and Bob Menendez represent states where $250,000 doesn’t go nearly as far.

    I grew up on Long Island. $250,000 is basically upper-middle class when you price in property taxes, which are fucking ridiculous, it really isn’t that much. My parents live in an upper middle class neighborhood, they pay $12,400 a year in property taxes.

    That’s not to say I support it, I want all the cuts to expire…period, but I get it. ending tax breaks on the rich isn’t something you’re going to find a lot of support for in New York and New Jersey outside of poor neighborhoods.

  74. 74
    lol says:

    Do the firebaggers still want Chuck Schumer for majority leader?

  75. 75
    Nick says:

    @PeakVT:

    though I’m not sure if there is a Senate rule that allows a bill to bypass the relevant committees.

    There is, but the only option would be to bring the House bill to the floor as is, but that wasn’t going to get anywhere in the Senate.

    Basically, you can get around the committee, but you probably would have to compensate for the vote of the chairman who would vote no on the bill because it bypassed his committee. We did it with Civil Rights because a Mississippi Senator chaired the relevant committee, but he was never going to vote for the bill anyway, we NEEDED Baucus’ vote.

  76. 76
    Nick says:

    @FlipYrWhig:

    think it would have been hugely popular initially, then gotten bogged down as Fox Nation learned that capitalism itself was at stake and Democrats just wanted to punish success. “Keep Big Government out of My Bank Account,” that sort of thing. I don’t think any effort to do anything that makes rich entrenched interests less arrogant and comfortable would remain as popular as it would begin.

    Agree. The stock market would have tanked and that would have been imprinted into the psyche of the country. It would have been “Obama destroyed the country taking these drastic unnecessary steps”

    It wouldn’t have helped the unemployment rate, might have made it worse.

    We would be exactly where we are, possibly worse. And the left would have just blamed “messaging”

  77. 77
    lol says:

    @Nick:

    $250,000 is still rich, even in New York City.

    All this “250K isn’t very rich in this very desirable neighborhood” talk is besides the point. You’re choosing to spend your money to live in a highly desirable area.

    Yes, it costs more to live in New York City or Manhattan. Wah wah wah. You’re still living in New York City and not Rural Bumfuck, Mississippi. Living in a highly desirable city or neighborhood is a choice.

    It’s like arguing that $1 million isn’t rich because that barely keeps up with my neighbors in Beverly Hills.

    This is one of the reasons people in this country have no understanding of the tax codes or who it affects. They only look at their neighbors when determining who’s “rich” or “poor” and not looking at objective numbers for the country. Thus you have people in Rural Bumfuck making $40,000 think they’re rich and their taxes are going to go up because everyone else around them is dirt-poor. Stop comparing yourself to just your neighbors.

  78. 78
    PeakVT says:

    @Nick: My objection to this argument is that while real estate is more expensive in certain areas of the country, most other things are about the same. And because lenders restrict the amount of money that goes towards housing to less than 33% (sometimes 40%), people who live in expensive areas have substantially more disposable income. That means the purchaser of an average home in Iowa and the average home on Long Island have different standards of living. The person in Iowa will have disposable income (guessing) of $10-15,000 a year, but the person in Long Island will have $30-40,000.

  79. 79
    ChrisS says:

    @lol:
    What’s really fun is that the people-who-aren’t-rich in NYC sell their condo in Manhattan for a million or three, buy a $600k house in NJ or LI, take some out of the remainder and put a fat down-payment on a couple of hundred acres of recreational property in upstate NY and start bitching that they can’t drill the fucker full of holes for natural gas. That despite a fair number of their neighbors not really thrilled with the environmental risk.

  80. 80
    Bruce (formerly Steve S.) says:

    Yesterday we had that big thread about the federal wage freeze and the question arises, what sacrifice would you be willing to make? Well, here it is. Instead of that idiotic, bullshit wage freeze our government should simply do nothing and let ALL the tax cuts expire, including the ones on me.

    Sadly, we live in stupid, cowardly times and a simple shared sacrifice that makes sense for all of us is not even on the table.

  81. 81
    DougW says:

    Sorry, but with the cut off of unemployment benefits that expired today, their will be no tax cuts for anyone. Or Else!

  82. 82
    water balloon says:

    @Nick, that’s just not true. I grew up on Long Island, and still live here. My parents combined didn’t make anywhere close to 100K a year, and I certainly don’t now. Property taxes are high here, but you don’t need to make hundreds of thousands of dollars to live well.

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