I haven't written much about politics in recent months - been busy, been disappointed, and just decided not to focus on little things every day.
But, President Obama's tax "deal" that he struck with the Republicans is an utter disaster. If the American people actually want to address the budget deficits and long term debt situation, then the crazy deal that Obama and the Republicans struck should be criticized by Americans from both parties.
The two year extension of Bush tax cuts that Obama and the Republicans are proposing includes a bunch of other tax cuts/tax credits, including - most alarmingly - a 2 percent reduction in FICA for next year. It is bad enough to extend the tax cuts for those making over $200,000 because the budget deficit will only continue to rise. But the 2 percent cut in FICA is immoral. If you are going to do this, then you might as well just eliminate Social Security.
As it is now, Social Security (i.e., the 6.2 percent of FICA that we see taken out of our paychecks) is running a deficit. Taking away 2 percent without any explanation of where the money to pay for Social Security will come from makes no sense whatsoever. For a worker making $50,000, they will have less than $1000 extra per year after income taxes. This will come to about $38 more per paycheck for someone who gets paid every 2 weeks. But it will create a budget hole of tens of billions of dollars that will have to be paid back when we have to borrow even more money to pay for the deficit.
Over the next two years, these proposed tax cuts are going to add almost $1 trillion to the national debt. This is going to ensure that President Obama makes no dent in the annual budget deficit - in fact it will probably be worse than when he started.
Why does he say he had to make the deal? So he could ensure that taxes wouldn't be raised on the middle class and so that he could secure 13 more weeks of unemployment benefits for people whose benefits are running out.
That is utterly pathetic. President Obama and the Dems could very easily have done the following:
1. The House could have passed middle class tax cuts and allowed taxes to increase on those making over $200,000 ($250,000 for married couples). They could have also included the 13 week unemployment extension in the bill.
2. Send it to the Senate and if Republicans actually wanted to filibuster it - let them. Don't hold a cloture vote to end debate - make them actually do the filibuster. Let the American people watch as Republican Senators held up all Senate work doing the filibuster. They would have caved - there is no way that Republican Senators were going to spend their Christmas in DC filibustering tax cuts for middle class Americans and an extension of unemployment benefits, just so wealthy Americans can continue to have a 4 percent tax cut that they don't really need.
3. As soon as Dems in the Senate secured the 60 vote majority to end the filibuster and pass the bill, the President could have signed it and shown the power he had.
Instead, he has negotiated away his strength, made it easier for Republicans to walk over him next time, and worst of all, ensured that the deficts will rise significantly in the short run, and the national debt will rise significantly in the longer run.
It is bad policy, and it is bad politics. Given how utterly devastating this "deal" is, I am going to hope that Dems refuse to go along with it - but they will cave. Now, I am seriously going to have to consider the challenger for the Democratic nomination that is almost surely going to emerge to challenge the President in the primaries.