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Thursday, December 09, 2010

Tax Deal: Done Deal Despite Progressives? Not So Fast, House Dems Defy Obama

Despite the caterwauling from progressive liberals in the media, the blogosphere and liberal Democratic politicians over the weekend after Barack Obama announced a deal on taxes that included the continuation of all Bush-era tax cuts, a deal on estate taxes aka death taxes, an extension of unemployment insurance, payroll-tax cuts, incentives for businesses and tax credits, it seems Democrats are being told by the Obama administration, via Joe Biden, to take the deal or risk "plunging the country into a double-dip recession if they reject his tax-cut deal with Republicans."

Obama’s White House started a full-court press on the agreement Wednesday that included a meeting between House Democrats and Vice President Biden.

House Democrats emerged from the meeting saying Biden told them the agreement essentially was final.

“It’s up or down,” Biden told them, according to Rep. Yvette Clarke (D-N.Y.)

Senior advisers to Obama told wavering Democratic lawmakers the tax package will speed the recovery and warned that failure to pass it would have disastrous consequences for the economy.

Senate Democrats led by Harry Reid are already set to schedule a vote on the package, but House Democrats are still "angry" the Washington Post describes and do not like the deal in it's current form, although VP Biden has made it clear this is the final bill.

In a forceful presentation, however, Biden made it clear that big changes are not in the cards. "The vice president said: 'This is the deal. Take it or leave it,' " an irritated Rep. Henry A. Waxman (Calif.) said, paraphrasing Biden.

I am sure that went over well... not.

Perhaps Democratic House Representatives should try a novel idea... listening to Americans, their constituents, the voters, who in two separate polls, Gallup and Rasmussen show a majority favor the tax deal the President cut with Republicans.


Two major elements included in the tax agreement reached Monday between President Barack Obama and Republican leaders in Congress meet with broad public support. Two-thirds of Americans (66%) favor extending the 2001 and 2003 tax cuts for all Americans for two years, and an identical number support extending unemployment benefits for the long-term unemployed.


A new Rasmussen Reports national telephone survey finds that 56% of Likely U.S. Voters favor the agreement that extends the Bush tax cuts for all Americans for two more years, cuts the Social Security payroll tax rate for one year and renews long-term unemployment benefits for an additional 13 months. Just 29% oppose the deal, but 15% are not sure about it.

For those whining about the estate tax aka death tax, Gallup found recently (11/23/10) that the top three issues for Americans are (from first to third) "passing legislation that would keep the estate tax from increasing significantly next year", "extending some form of federal income tax cuts passed by George W. Bush that are set to expire at the end of this year," and "extending unemployment benefits for the long-term unemployed."

Those are the top three issues Americans wanted to see dealt with during the lame duck session of Congress (after elections before the newly elected politicians are seated).

This deal between Republicans and Barack Obama covers all three of the issues mentioned above.

Over the last two years liberal Democratic politicians have ignored the American people and passed their own ideological agenda time and again, in some cases in direct opposition of the majority of Americans wanted and it looks like they are about to set themselves in direct opposition yet again over this issue.

Only this time, they are not only ignoring Americans but are giving the finger to Barack Obama, the leader of their own party.

Breaking from CNN "House Democrats defy Obama on tax cut bill"

Defying President Obama, House Democrats voted Thursday not to bring up the tax package that he negotiated with Republicans in its current form.

"This message today is very simple: That in the form that it was negotiated, it is not acceptable to the House Democratic caucus. It's as simple as that," said Democratic Congressman Chris Van Hollen.


"There is an important debate on Capitol Hill that will determine in part whether our economy moves backward or forward," Obama said at an Export Council meeting. "The bipartisan framework we have forged on taxes will not only protect working Americans from seeing a major tax increase on January 1, it will provide businesses with incentives to invest, grow, and hire."

"Every economist I have talked to or read over the last couple of days acknowledges that this agreement would boost economic growth in the coming years and has the potential to create millions of jobs," Obama continued. "The average American family will start 2011 knowing that there will be more money to pay the bills each month, more money to pay for tuition, more money to raise their children," he said. "But if this framework fails, the reverse is true. Americans will see it in smaller paychecks that will have the effect of fewer jobs."

My headline yesterday has been proven spot on "Liberals Want To Let Taxes Rise For Everyone And Cut Off Unemployment Benefits."

Side Note: If Democrats led by Pelosi don't allow this issue to be dealt with before Republicans take over control of the House of Representatives in January, they could deal with it and make it retroactive. The problem there is that IRS has already warned "that retroactively changing 2010 tax laws early next year "would be extremely detrimental to the entire tax filing season and to tens of millions of taxpayers."

[Update] Outgoing Democratic Representative Michael McMahon tells liberal Democrats and others who are howling at President Barack Obama for dealing with the GOP on taxes to stop acting like "petulant children".

[Update #2] White House issued a statement:

"The House and Senate are working through the normal process of bringing a bill forward and we are confident that the major components of the tax framework that we fought for will remain in the final package brought to the floor and ultimately passed by Congress."

[Update #3] Democratic House vote by Nancy Pelosi defying Obama is non-binding and may just be a way to "save face" in the eyes of progressive base, but White House has a plan B!!!

Take it away NRO:

UPDATE: Thanks to a commenter for pointing out the White House is sufficiently worried about the House Democrats that it is considering alternative legislative strategies. Speaker Pelosi has already said she won’t touch the Obama-McConnell deal until the Senate acts on it (if at all), and now CNN’s Ed Henry reports that, in light of the caucus vote, an unnamed senior White House adviser is saying that the strategy now is to use a bill already passed by House as a vehicle for the new tax deal, and send it back to the house — something the adviser called “jam[ming] the House.”

This, ironically, would amount to giving House leadership a taste of their own medicine, since they used the procedural advantages associated with the “amend a Senate bill” trick to pass their middle-class-only tax bill without giving the Republicans an opportunity to offer an alternative.

Regardless, the ball is still in Pelosi’s court. House leadership has wide prerogatives on what that body does and does not consider. Just about the only real way to force a vote without the Speaker’s approval is a discharge petition, which would require 218 signatories and 30 days. So — oh, delicious irony! — the only thing standing between President Obama and what looks like it would be the most popular initiative of his term – is Nancy Pelosi!