President Barack Obama is extending a new proposal to Republicans that he hopes will break the political gridlock on budget negotiations, offering to cut corporate tax rates in exchange for job investments.Given that you couldn't get most congressional Republicans to say yes to a free million dollar bill if it had Obama's picture on it, the prospects of Grand Bargain 2.0 really aren't any better than Grand Bargain 1.0. Indeed, House Speaker John Boehner's office has already come out and rejected the proposal, even before the president has formally delivered it.
White House officials say just because they’re at an impasse with congressional Republicans over a grand bargain on reducing the deficit doesn’t mean they shouldn’t look for other areas of agreement. So Obama plans to use a trip to an Amazon.com distribution center in Chattanooga, Tenn., on Tuesday to propose a “grand bargain for middle-class jobs.”
Obama long has called for a cut in corporate tax rates, but previously insisted such business tax reform be coupled with an individual tax overhaul. He’s dropping that demand and says instead that he’s open to the corporate tax cut that that businesses crave. But he wants it to be coupled with a significant investment on some sort of job creation program, such as manufacturing, infrastructure or community colleges.
But at least this time, the president seems to have gotten the politics right. It's impossible to fathom rallying the Democratic Party around a 2014 message criticizing Republicans for refusing to accept Social Security cuts in exchange for tax hikes. But going after them for caring so little about job creation that not even corporate tax reform could entice them to take action? That's something that could work.
President Obama will deliver his remarks at 2:00 PM ET at an Amazon facility in Chattanooga.