Just imagine Boehner's tears if President Obama
force Republicans to choose between the trigger
and repealing Bush high-income tax cuts.
Yesterday, President Obama
said the Gang of 12 super committee created by the debt deal should come up with a deficit reduction package that relies on tax reform and Medicare "adjustments" to achieve budgetary savings. Meanwhile, Eric Cantor and John Boehner once again
ruled out supporting tax increases from the Gang of 12.
Whatever ends up happening, it's important to recognize that this time around, President Obama has all the leverage he needs to get what he wants. The reason is simple: nothing the Gang of 12 proposes can become law without President Obama's signature. Even if it passes Congress, he can veto it. Yes, that would trigger automatic cuts, but those cuts don't begin until 2013 and they could be repealed.
At a minimum, President Obama should insist on repealing the Bush tax high-income tax cuts. There's a variety of ways this could happen: one way would be by extending the middle-income tax cuts permanently and allowing the high-income tax cuts to expire. Another would be tax reform that produces the same amount of revenue (with the same distribution) as would be generated by expiring the Bush high-income tax cuts. And yet another way would be to simply end the Bush tax cuts altogether, for everybody.
But while any of those proposals would be acceptable, they fall short of what President Obama proposed in April, when he embraced both tax reform and ending the Bush high-income tax cuts. His revenue plan would have generated about $2 trillion over the next decade, blowing far past the Gang of 12's deficit reduction target, even if there weren't any spending cuts at all.
Unfortunately, President Obama has all but abandoned that revenue plan. Instead, his opening bid is tax reform plus Medicare cuts. Based on what happened last time, there's a good chance it'll get worse from there.
Whatever ends up happening with the Gang of 12 super committee, let's be clear on one thing: this time, thanks to the power of the veto, President Obama has the leverage. How he chooses to use that leverage is up to him. Hopefully he uses it to take a principled stand for fairness and equity, and to fight for the people who sent him to the White House.
