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It is true, unfortunately, that the proposed deal now being hammered out to lift the debt ceiling does not include any new revenue, as the President and Congressional Dems had long advocated.  The Rs won a concession on that point, as they have on so many in this abysmal process, by threatening to destroy one of this country's most valuable national assets, the full faith and credit of the U.S. treasury.  They took the hostage and threatened to shoot and a significant chunk of their members are just crazy enough to make that threat serious.
That sucks -- no way around it.  We need new revenues to balance this deficit eventually and we didn't get them in this negotiation.
But we may get them yet.  The Bush tax cuts will expire at the end of next year, and the Rs badly want them extended.
Next time around, it will be the President and the Dems holding the strong cards.

In exchange for spending cuts, this proposed deal will extend the debt ceiling through the end of next year, long enough to get us past the 2012 election without having to repeat this agonizing and profoundly idiotic process.  This will allow the government to continue to borrow as needed to function into 2013.  The deal will also set up a committee of Congress members to come up with recommendations for further ways to cut the deficit: additional spending cuts and/or increased tax revenues.  The committee is to make their recommendations by December 23 of this year, 2011.  If the committee can't reach agreement then the deal now being finalized will require deep cuts in both domestic and defense spending.  Neither side will want that, although many Rs will probably like the idea of entitlement cuts while not wanting the defense cuts. Therefore, this deal doesn't seem like it gives the Rs enough of an incentive to agree to anything in the committee -- if those were the only considerations, the traditional Republicans will be nervous about cutting defense and social programs going into an election year, but the tea party types would probably say "yeah, baby, bring on the deep cuts!"  
But remember those tax cuts.  They expire at the end of 2013.  By the end of this year the Bush tax cuts will have just one more year to go.  Those aren't just revenue increases from closing loopholes and ending deductions.  They are increases in tax rates for all rich and many upper-middle-class taxpayers.  Those folks are the GOP base.  The Rs will have a powerful incentive to reach an agreement to try to save as much of that tax cut as they can.  Don't forget how devoted the Rs are to tax cuts at all costs, always.  It's the only principle that still defines and holds the Republican Party together.  They may hope that they can defeat President Obama (and hold onto the House of Representatives) in 2012, but they have to know they will be taking a real risk if they don't cut a deal and instead roll the dice on the outcome of that election.  If they lose that gamble and the President is re-elected they will be facing a newly-re-elected Democratic President right at the start of his second term, free of any re-election considerations whatsoever.  And they've seen the polls -- they know how popular the idea of tax increases on the wealthiest Americans are.  

We haven't heard much about the Bush tax cuts lately, and I suspect that is not unintentional on the part of Obama administration officials.  But those cuts are ending in less than a year and a half -- and that flips the leverage completely around between Republicans and Democrats.
Keep that in mind in evaluating this current debt ceiling deal.  
I'm sure that the administration is.

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Comment Preferences

  •  I have little faith the tax cuts will end. n/t (8+ / 0-)

    Fuck me. He made it.

    by dagolfnut on Sun Jul 31, 2011 at 11:51:16 AM PDT

    •  But they expire by law (1+ / 0-)
      Recommended by:
      Sanuk

      If nothing happens, they disappear.  That's the way they are written into law.
      So they are a valuable bargaining chip.
      At the end of last year that led to an extension in unemployment benefits for millions of unemployed Americans -- no small benefit.

      •  As they were last year, and yet they (10+ / 0-)

        somehow, miraculously, they survived. I am not so sure about the value of UE benefit when the destructive costs to the deficit are factored in.

        Fuck me. He made it.

        by dagolfnut on Sun Jul 31, 2011 at 11:58:50 AM PDT

        [ Parent ]

        •  Unemployment benefits are huge (1+ / 0-)
          Recommended by:
          thematt523

          The extension of unemployment benefits in the midst of the deepest economic recession in 75 years was HUGE.  Not only are they about most economically stimulative thing the government could do, but they are an absolute lifeline for millions of desperate Americans.

          That's pretty important.
          And President Obama did that.

          •  And we'll just have to keep extending them (4+ / 0-)
            Recommended by:
            Losty, MJB, Odysseus, Redbug

            Because with cuts like these, there sure as hell ain't gonna be any more jobs.

            You might want to google "Pyrrhic victory".

          •  Look I do not disagree that extending UE (4+ / 0-)
            Recommended by:
            Shahryar, Odysseus, lgcap, Redbug

            mattered greatly to those who needed it. Frankly the cost of the deal vastly outweighed the benefits obtained, in the grand scope of things. It showed the world that Obama cared more about the 'deal' than about what the deal produced. He said he had no choice but to take the deal. The repubs realized they could get pretty much ANYTHING they wanted at that point. That O would compromise/capitulate to get the 'deal'. It is a direct line from that 'deal' to where we are this weekend.

            Fuck me. He made it.

            by dagolfnut on Sun Jul 31, 2011 at 12:17:53 PM PDT

            [ Parent ]

            •  Helping millions of Americans, and the economy (0+ / 0-)

              That's what the deal produced last December, dagolf.  That's pretty important.

              You seem to be assuming that the Rs would have simply caved if he hadn't accepted the deal.
              That's a mighty big assumption.
              Yes, it would be much, much better if the President didn't have to deal with a Republican party that includes a number of right zealots and controls the House firmly and can block anything moving in the Senate.
              But he does.
              That's just reality.

              I'm saying that he'll be in a stronger position next time around than he was this time.

              •  Nope. I am sure the repubs wouldn't have (0+ / 0-)

                caved. We got the short end of the stick in that 'deal' and it set the precedent for how the repubs would deal with O, going forward. There will be some new 'crisis' hostage come 12-31-2012, that is guaranteed.

                It appears we will have to agree to disagree when it comes to your theories on Obamas' past and future negotiations/deals.

                Fuck me. He made it.

                by dagolfnut on Sun Jul 31, 2011 at 01:00:15 PM PDT

                [ Parent ]

                •  2 yrs of lower taxes worth it 4 unemplymnt benef's (0+ / 0-)

                  We also disagree on whether the last deal was worth it, obviously.

                  You would have let the tax cuts expire two years earlier at the cost of letting unemployment benefits expire for millions of Americans.
                  I think it was better to keep the tax cuts in place for two more years and get the continued unemployment benefits (not to mention clearing the decks for the rest of the legislation that was held up, such as ending Don't Ask, Don't Tell, etc.).

                  I think the stimulative effect of the continued unemployment benefits plus their critical importance to those millions of vulnerable Americans and their families was worth extending the cuts for another two years.

                   But I agree that the Rs have employed unprecendent legislative tactics of blatant obstructionism and hostage-taking, and they have paid very little price for it -- essentially, they have gotten away with being truly the "party of no," and even the "party of burn it down and break the President."
                  And I find that incredibly frustrating and outrageous.  

    •  Right (6+ / 0-)

      They will be negotiated away to close a few tax loopholes, and the maximum tax rate for billionaires will be lowered between 23-25%.  Yup, and that's when Obama will jump up and down and really declare victory.

      •  You think tax rates will be lowered, Major Tom? (0+ / 0-)

        I doubt it.
        That may be what the Rs want, but I don't see that happening.
        If anything, tax rates on the richest Americans will go up.

        The President and the Dems will hold the cards in the next round.

        •  The tax rates are supposed to go into (0+ / 0-)

          3 ranges.  The GOP want this 3 tier and bring the top rate down....moving closer to a flat tax.  Are you freaking joking? Then they will have fees that are put on people who use thinigs - like auto licenses, etc....and fee you to death.  It is just more shifting of the wealth to the rich and sticking the poor with the bills.   MORE SHOCK DOCTRINE!

  •  Do you in your right mind think Obama will (13+ / 0-)

    Let thos tax cuts expire? I don't, the guy doesn't have the courage to let it happen. This deal is a complete cluster fuck to the elderly, poor and minorities.

    •  They give him and Congressional Dems leverage (2+ / 0-)
      Recommended by:
      Sanuk, thematt523

      The Rs really don't want them to expire.
      That puts them in a weaker position, and gives the leverage to the President and the Democrats.

    •  you lefties make me sick (7+ / 0-)

      always being right and all, and then having the nerve to mention it when you're being right about the next thing.

      No wonder nobody takes you seriously!

      Besides, let's take a look at all the good things that have happened under President Obama.

      He's 100% totally responsible for giving women a larger window in which to sue their employers.

      He single-handedly made it possible for all Americans, starting in 2014, to have to buy unregulated medical insurance.

      He ended the Iraq war by agreeing to leave only 50,000 troops there.

      He ended the Afghanistan war by killing bin Laden and reducing our forces there from 33,000 to 70,000.

      He's now about to strengthen Social Security and Medicare. Let's face it. Americans today live longer than ever, are healthier than ever, can work until they're in their 80s. Now, thanks to these new discussions, SS and Medicare will be there when these octogenarians retire.

      He's sharply redefined the Democratic brand. We now have the easier task of explaining to low information voters that the Democrats stand for the letter "D" and the letter "D" stands for whatever the President is doing.

  •  You mean the Obama/Bush Tax Cuts... (8+ / 0-)

    Obama owns them now.

    This is a crisis I knew had to come, Destroying the balance I'd kept. Doubting, unsettling and turning around, Wondering what will come next.
    --Ian Curtis

    by jethrock on Sun Jul 31, 2011 at 11:52:40 AM PDT

  •  LOL (5+ / 0-)

    And we now return to our reality programming.

    •  Paleo, leverage is important (3+ / 0-)
      Recommended by:
      ajr111240, Sanuk, thematt523

      This isn't all about being pure of spirit and progressive of mind.
      It's about the cold, hard reality of politics.
      And the reality is that the Rs want those tax cuts extended, while President Obama and the Dems don't, particularly.
      That puts them in a more powerful position than they were in this time.

      •  Just like in December 2010? (3+ / 0-)
        Recommended by:
        RainyDay, Sychotic1, marty marty

        How did that turn out?

        What this is about is constantly caving in to blackmail.

        •  Yes, when unemployment benefits were extended (1+ / 0-)
          Recommended by:
          thematt523

          For those millions of unemployed Americans and their families, having those benefits extended worked out incomparably better than having them cut off on December 31, 2010.

          And for their landlords.
          And their grocers.
          And their local gas station owners.
          Etc.
          Etc.
          Etc.

          •  The Big Lie (2+ / 0-)
            Recommended by:
            Odysseus, lgcap

            There was never a connection between the two until Obama and his apologists made one.  In '12 they'll come up with some new cover story for their capitulation.

            •  The connection was they both expired on 12/31/10 (2+ / 0-)
              Recommended by:
              thematt523, FG

              And the Rs refused to extend the unemployment benefits, Paleo.
              It wasn't President Obama and "his apologists" who connected the two things.  It was the Republicans in the Senate, led by Mitch McConnell.

              You may think President Obama is the enemy of progressives.  He's not.
              It's Republicans.

              •  Simply untrue (0+ / 0-)

                Read back.  No mention until the tax cut capitulation.  The problem with Obama is that he cabes every time the Republicans make a threat.  Rather then daring them to go through with it.  Which just emboldens them for the next round.  Senate Republicans never would have blocked unemployment extension on the eve of X-Mas. They had blocked it previous times only to end up relenting.

                Had Obama threatened to veto any bill that contained a tax cut extension for the wealthy, this would have been a moot point.  But this president does't threaten Republicans.  He appeases them.

                •  Paleo, the GOP blocked it over and over and over (1+ / 0-)
                  Recommended by:
                  FG

                  You are the one who has forgotten what happened here.
                  The Republicans didn't just "threaten" to block the extension of unemployment benefits.  They did it -- over and over and over again, all year long in 2010.

                  Here, for instance, is the start of a report from ABC News on July 1, 2010:

                  More than 1.3 million unemployed workers won't be getting their next round of unemployment benefits, after Congress failed again to pass an extension bill Wednesday night. With Congress taking a Fourth of July recess, those hoping to get their benefits reinstated will have to wait until at least July 12th, when Congress comes back in session to pick up the issue.

                  The main holdup is coming from Republicans, who have filibustered the bill three times. They say paying for the benefits by adding to the national debt is unacceptable. Instead they propose using the leftover money from last year's economic recovery package to pay for the bill. For now, Democrats have rejected that offer.

                  "The only reason the unemployment extension hasn't passed is because Democrats simply refuse to pass a bill that doesn't add to the debt," said Senate Republican leader Mitch McConnell of Kentucky.

                  (Emphasis added).
                  GOP blocks unemployment
                  Paleo, if you think the Rs would have caved on Christmas Eve out of the goodness of their hearts, I'm afraid you've got a hopelessly rosy outlook on the character of the modern Republican party in Congress.  They had been blocking that extension all year long.

                  •  Revisionism (0+ / 0-)

                    Obama did not promise to use the extension as a bargaining chip for the unemployed.  

                     

                    Sep 9, 2010  OBAMA: Look, the reason is because those folks, as I said over the last decade, at the time when the Republicans were in charge, didn't see a wage increase. Did not see their incomes go up at a time when their costs for health care, for college tuition, for everything else was going up. So, they are just barely keeping their heads above water. The one group that actually saw their incomes increase substantially when … Republicans were in charge, were the top two percent of Americans. The folks who saw the biggest jump were the top one tenth of one percent of Americans.

                        STEPHANOPOULOS: Does that mean you will veto an extension of tax cuts to the wealthy?

                        OBAMA: What I am saying is that if we are going to add to our deficit by $35 billion, $95 billion, $100 billion, $700 billion, if that's the Republican agenda, then I've got a whole bunch of better ways to spend that money.

                        STEPHANOPOULOS: But you're not saying you're gonna veto it.

                        OBAMA: I, there are a whole bunch better ways to spend the money.

                        STEPHANOPOULOS: How come you don't want to say veto?

                        OBAMA: There are a whole bunch better ways to spend the money.

                    •  lg he *did* use the extension to extend unemplymnt (0+ / 0-)

                      Maybe you've forgotten, but that was the deal in December.  
                      Your quote is from early September.  Later that month the Dems in Congress caved and agreed not to bring up the tax cut extensions before the November election, scared that the Rs would label them as "increasing your taxes" even on the very wealthy.
                      So, in December, with unemployment benefits AND the Bush tax cuts both expiring as of the end of the month, he cut the deal that extended both (AND included a payroll tax cut, AND cleared the way for Congress to repeal Don't Ask, Don't Tell, etc.).
                      From the December 7, 2010 Washington Post:

                      President Obama and congressional Republicans have reached a tentative accord on a far-reaching economic package that would preserve George W. Bush administration tax breaks for families at all income levels for two years, extend emergency jobless benefits through 2011 and cut payroll taxes by 2 percent for every American worker through the end of next year.
                      The scope of the agreement, announced by the White House late Monday, was far broader than lawmakers in either party had been expecting. The deal would extend a college tuition tax credit and other breaks for middle-class families that were due to expire New Year's Eve. And it would revive the inheritance tax after a year-long lapse, imposing a 35 percent rate on estates worth more than $5 million for individuals and $10 million for couples.

                      (Emphasis added).
                      12/7/10 Wa Po

      •  Obama uses leverage against Dems, not GOP... (1+ / 0-)
        Recommended by:
        marty marty

        If he has leverage against the GOP, he'll give it away and get nothing in return.

        Please help to fight hunger with a donation to Feeding America.

        by MJB on Sun Jul 31, 2011 at 12:51:49 PM PDT

        [ Parent ]

        •  MJB, like an extension of unemployment benefits? (0+ / 0-)

          In December of last year President Obama got an extension of unemployment benefits for millions of out-of-work Americans in the midst of the worst economic times in 75 years, in addition to clearing the way for the repeal of Don't Ask, Don't Tell and other important legislation.
          You consider that "nothing?"

          I respectfully suggest you are wrong about that.
          I think it was very important to the nation's weak economy, and it was absolutely crucial to those millions of desperate Americans and their families, MJB.

          I understand that many are frustrated that our national politics hasn't more favorable to progressives over the last few years.
          But let's not forget what's important.

          •  You've said that same thing in > 10 comments (1+ / 0-)
            Recommended by:
            lgcap

            We understand your point of view.

            Please help to fight hunger with a donation to Feeding America.

            by MJB on Sun Jul 31, 2011 at 01:07:29 PM PDT

            [ Parent ]

            •  MJB, so what's your response? (0+ / 0-)

              I mean, aside from "Obama sucks!"

              You claimed the Presidenbt gets "nothing" in return in his negotiations with Republicans.
              I pointed out just what he has gotten in return in his past negotiations.
              I get that you're frustrated that everything isn't as you would like it to be.
              But, in the real world, where Republicans have a share of the power and wield it effectively, what do you expect?

              You don't seem to think it will make any difference that President Obama and the Dems may have some increased leverage from the tax cuts expiring.
              So what do you think should be done?

            •  The unemployment extention was (0+ / 0-)

              trivial compared to the disaster that the Bush tax cuts will cause. Six months of benefit to some unemployed people, compared to the austerity that the teabaggers (with Obama's acquiescence) are now forcing on us? Come on, it makes absolutely no sense whatsoever.

               

              •  Trivial? Not for millions of desperate Americans (0+ / 0-)

                The unemployment benefit extension continued modest benefits for millions of unemployed Americans and their families right in the midst of extremely hard times.
                Almost every single dollar of benefits was spent and very quickly began recirculating in the national economy, going almost immediately back out to landlords and grocery stores and hardware stores and vendors and businesses of all kinds.
                There was also a payroll tax cut as part of the bargain that also helped put some additional dollars into the paychecks of millions of people.

                I'd hardly call that "trivial," lgcap.

                And remember, it was in exchange for a two-year extension of the tax cuts -- so those cuts will expire at the end of next year, giving the Dems and President Obama leverage over the Rs.

  •  And will be renewed. (5+ / 0-)
    Recommended by:
    Major Tom, RainyDay, Losty, Sychotic1, gharlane

    Next?

  •  Just in time for the new President to extend them (4+ / 0-)

    whichever helmet-headed puppet gets installed.

  •  Do you honesty believe (4+ / 0-)
    Recommended by:
    RainyDay, Sychotic1, Odysseus, marty marty

    That the Democrats will allow them to expire? I certainly don't.

  •  So You're Saying..... (0+ / 0-)

    that will be Obama's platform?  He will run on extending the Bush taxcuts?  Do you seriously think he's not going to be asked about those tax cuts every single frigging minute of the entire 2012 campaign?

    I don't know why I don't feel cluster fuc*ed.  I'm elderly & on both SS & Medicare.  The last time I checked I was a lucid, highly functioning member of society.  You must know more than I about the future status of SS & Medicare.  

    •  when did you start getting SS/Medicare? (0+ / 0-)

      how long have you had them? Could you have done without them for a few years?

      •  I've Had SS for 3 Years....It's Fabulous. (3+ / 0-)
        Recommended by:
        Shahryar, Odysseus, marty marty

        I turned 65 in September....I started Medicare the month after my birthday.  Ditto.....It's more than fabulous.

        I retired early at 60 after 25 years as a nightshift RN.  I certainly could have done without SS for a few years.  We saved 20% of each paycheck for decades.  Took it right off the top, never even missed it.  

        My husband paid into teachers pensions for 30 years.  We took one at 60 & one at 65.  We're comfortable & very grateful for SS & Medicare.  Medicare especially.....it takes the worry out of healthcare insurance for us.  

    •  I'm saying that puts him in a stronger position (2+ / 0-)
      Recommended by:
      AAMOM, snapples

      Remember, the Rs wanted to include an extension of the Bush tax cuts in whatever deal was cut to increase the debt ceiling.
      They didn't get that.
      That leaves that issue out there, and it's an issue that cuts strongly in favor of the President and the Dems .
      The idea of tax cuts on the wealthy to help reduce the deficit is broadly popular.
      The tax cuts will expire automatically on 12/31/12 unless Congress & the President affirmatively act to extend them.
      The Rs badly want them extended.

      This gives the President and the Dems some significant leverage that they didn't have this time around.

    •  Hey it worked for him in 2008 (0+ / 0-)

      Why not try it again?

  •  Please explain why the Rethugs can't just (1+ / 0-)
    Recommended by:
    Norm in Chicago

    pass an extension in the House next fall BEFORE the election and dare the Dems in the Senate and the White House to oppose them?

    Just another faggity fag socialist fuckstick homosinner!

    by Ian S on Sun Jul 31, 2011 at 12:27:52 PM PDT

    •  they can, but that would be great for the Dems (0+ / 0-)

      The Dems in the Senate could then amend the bill to extend the tax cuts ONLY for those earning less than $250,000 per year -- and the Senate Rs would be forced to filibuster that just before the election.

      Polls show that something around 70% of respondents say that any deficit reduction should be include tax hikes on the rich.
      The Dems should LOVE to have that fight just before the election.

  •  If economy tanks, could be a '12 campaign plank (0+ / 0-)

    It really depends on how bad things get.  If the GOP balances the budget with only spending cuts, then they own the economy.  They will have everything they wanted.  Low taxes and low gov't spending.

    So by everything they've said, jobs should be popping up everywhere.  If by election day the jobs have not come back, then the Teabagger economic philosophy can be judged a failure for all to see.

    It can then be explained to the American people that making the rich richer did NOT create jobs, and that only revenue increases can stimulate the economy.

    I would argue that an import tariff should be strongly supported by Democrats, but the Bush tax cuts should also be included, with new tax revenue to be spent on infrastructure projects to create jobs and pave the way for manufacturing to return.

  •  a friendly reminder... (1+ / 0-)
    Recommended by:
    carpunder

    The budget has to be submitted and approved next and you can expect this whole scenario to repeat itself in about a month...

    Fox News, The triumph of stupidity over reason.

    by laughingriver on Sun Jul 31, 2011 at 12:43:36 PM PDT

  •  These tax cuts will not expire. (1+ / 0-)
    Recommended by:
    marty marty

    The tax cuts will be reauthorized.

    The executioner sneered as the young queen ascended the stairs to the guillotine; in the old days, he thought, at least there was some buildup, a little time on the rack or some disemboweling, but nowadays everyone wants instant gratification. - Rossi

    by A Runner on Sun Jul 31, 2011 at 01:09:40 PM PDT

  •  The Rs will always have the leverage (0+ / 0-)

    they don't care about the well being of the country, democrats do.

    Republicans hate Obama more than they hate taxes.  They would have let all the taxes expire in 2010 to make Obama look bad.  

    Obama and Reid thought the debt ceiling would push the tea party and republicans into a corner, otherwise they would have raised it back in Dec 2010.  It was a huge miscalculation as the tea party does not care if America defaults.

    no entitlement cuts. period.

    by The Clevelander on Sun Jul 31, 2011 at 01:47:26 PM PDT

  •  It takes 60 in the Senate to extend the cuts. It (1+ / 0-)
    Recommended by:
    twcollier

    won't happen next time. However, just  to make sure, we have to ramp up the "class warfare". Voters like it. The Dems can win with it.
    It's going to be important to immediately pivot out of this mess to capitalize on the GOP's big mistake in getting this mess started in the first place.
    Dems should be talking about jobs and why the GOP is not doing anything to create jobs.
    Etc.
    One thing that Progressives should understand is that even though they may hate the Pres, the average American likes him and trusts him much more than they do Boehner, etc.
    Criticize him if you will, but we need to leverage his credibility against the GOP.
    The GOP will definitely try to pivot out of this mess with another distraction. We need to cut them off at the pass.

    •  YES! Time for the Dems to go on the attack (0+ / 0-)

      The President and the Dems should set to work tomorrow morning driving home the message that the Rs were willing to destroy the economy and cut Medicare benefits to protect tax breaks for corporate jet owners, while the recovery sputters and ordinary people are suffering.

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