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Obama Capitulates on Bush Tax Cuts

President Obama appeared at the White House this evening to announce that he had finally, after months of delay, caved to Republicans and allowed all of the Bush tax cuts to be extended for two years.

During a January 2009 meeting, Obama famously told Republicans “I won” when challenged on the amount of spending relative to tax cuts in the stimulus bill. Well, last month, he lost.

Obama of course said he had no choice but to be above politics and accept GOP demands for the good of the American people. ALL WHILE PLAYING POLITICS HIMSELF.

Instead of casting the deal as a launching pad for a future Land of Bipartisan Compromise he says he wants, the president basically accused Republicans of a politically motivated plot to hold the middle class hostage while seeking favors for the wealthy.

I know there’s some people in my own party and in the other party who would rather prolong this battle, even if we can’t reach a compromise. But I’m not willing to let working families across this country become collateral damage for political warfare here in Washington. And I’m not willing to let our economy slip backwards just as we’re pulling ourselves out of this devastating recession.

I’m not willing to see 2 million Americans who stand to lose their unemployment insurance at the end of this month be put in a situation where they might lose their home or their car or suffer some additional economic catastrophe.

So, sympathetic as I am to those who prefer a fight over compromise, as much as the political wisdom may dictate fighting over solving problems, it would be the wrong thing to do. The American people didn’t send us here to wage symbolic battles or win symbolic victories.

Awww. Obama didn’t lose a fight. He just walked away.

This is very noble of Obama, since he’s keenly aware that Republicans have no principles. Nevermind that Obama would have written his own Political Obituary if he had failed to reach a deal with Republicans and taxes had gone up.

The deal in fact included many items Obama sought, including a generous extension of unemployment benefits.

So if he really wants to, you know, act like a president, he would have said something like, “I didn’t get everything I wanted, but that’s life.”

Here, courtesy of the Associated Press, is the rest of the deal.

Officials said that under the plan, unemployment benefits would remain in effect through the end of next year for workers who have been laid off for more than 26 weeks and less than 99 weeks. Without an extension, two million individuals would have lost their benefits over the holidays, the White House said, and seven million would have done so by the end of next year.

The Social Security tax cut would apply to workers, not employers, and would drop from 6.2 percent of pay to 4.2 percent for one year. The White House said the result would be to fatten take-home pay by $120 billion over the course of the year.

In addition, administration officials emphasized that the agreement would extend a variety of other tax breaks for lower and middle-income families, including the Earned Income Tax Credit and the child tax credit.

The estate tax provision under discussion would mean the first $5 million would pass tax-free to heirs. Anything over that would be taxed at a rate of 35 percent. Democrats favored a $3.5 million threshold, with a 45 percent tax on anything higher.

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4 Responses to Obama Capitulates on Bush Tax Cuts

  1. To him give and take means give me your ideas and I will take the ones I like–he liked this because it saved him from torches and a mob, and the Republicans gave him cover. He is pretty “transparent” after all.

    • Great point – Republicans gave him the cover he needed to do what he had no choice but to do. Raising taxes on anyone now would have killed everything, and his economic advisers are actually more moderate than he and probably told him that.