We Can Do Better Than Tax Cuts

Thursday, 09 Dec 2010 09:47 AM

By Lanny Davis

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Sen. (later President) John F. Kennedy wrote a Pulitzer Prize-wining book in the 1950s titled, “Profiles in Courage.” Bill Clinton in 1992 had an incident called his “Sister Souljah moment” — a phrase that has become synonymous with the same definition of political courage used by Kennedy in his famous book: The willingness to stand up to your own base when you feel it is the right thing to do, even though it is the hardest thing to do.

On the merits I strongly disagree with extension of any of the Bush tax cuts — disagreeing with President Obama and most Democrats that the middle-class tax cuts included in President Bush’s tax cuts should be extended. I am concerned that by extending all the Bush tax cuts we are adding another $3 trillion or more to the national debt, leaving our grandchildren and probably our great-grandchildren (I should live so long) to pay the tab.

I would have preferred allowing the Bush tax cuts to expire and reverting back to the tax rates and policies that existed under President Clinton. As I recall, Clinton ended his second term after an era of unparalleled prosperity, having created more than 23 million new jobs created and converted a $300 billion deficit at the beginning of his first term into a $1 trillion dollar surplus by the end of his second term (with a 65 percent job approval rate, by the way).

Instead, thanks in part to the Bush tax cuts (and, to be accurate, also because of 9/11 and many other factors), Democrats and Republicans spent eight years using credit cards to pay for two wars and a multitude of social programs (also, to be fair, programs that we liberals supported without being willing to pay for them). It is accurate to say that we decided to borrow from the Chinese government to pay for our current expenses, including allowing multimillionaires (and most of the rest of us) to pay less taxes.

But given the slow recovery from the Great Recession of 2008-09, I can understand the reluctance of most Democrats, including Obama, to allow the middle class higher pay checks derived from the Bush tax cuts to continue what appears to be a slow but steady economic recovery.

So, I didn’t get my way today when the president chose to compromise.

But then again, I recognize that we lost the November elections because there aren’t enough Americans who vote who agree with my liberal views. So I don’t end up with saying to Obama, “my way or the highway.” The reason, for me, is simple: I am not one of the unemployed whose unemployment compensation will now be renewed for a year thanks to Obama’s willingness to compromise and take the heat from his liberal base.

So I ask my fellow liberals (and in particular, the brilliant liberal New York Times columnist, Frank Rich, who wrote quite an ugly personal attack on Obama this past Sunday for his apparent willingness to compromise with Republicans on the tax cuts among other issues): Would you prefer no deal at all (and thus, no extension of unemployment compensation) if you were unemployed and your unemployment payments were about to run out just before Christmas?

Or to put it another way, Do you believe there is a single unemployed person whose unemployment payments would cease who opposes Obama’s compromise agreement with the Republicans?

I don’t think so. Do you?

So while I disagree with the extension of these tax cuts, especially to those in the highest income brackets, I appreciate the willingness of President Obama to take the heat from his own political base knowing the larger good to the middle class to avoid paying higher taxes and to the unemployed to enjoy continued unemployment benefits.

In the final analysis, elections are won between the 20 yard lines. Only a wealthy purist liberal has the luxury of preferring to “just say no” rather than accepting incremental progress through compromise, as Obama showed the profile-in-courage to do.

Davis is the principal in the Washington D.C. law firm of Lanny J. Davis & Associates, which specializes in strategic crisis management and is a partner with Josh Block in the strategic communications and public affairs company Davis-Block. He served as President Clinton’s special counsel in 1996-98 and as a member of President Bush’s Privacy and Civil Liberties Oversight Board in 2006-07. He is the author of “Scandal: How ‘Gotcha’ Politics Is Destroying America” (Palgrave Macmillan, 2006).




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