Through the last few weeks of budget negotiations, there’s been a backdraft of commentary suggesting that for all the talk about defeat for Republican principles, the tax rate endgame actually represents a massive vindication of Republican tax-cutting principles. Here’s but one example from today. After all, virtually every deal discussed involves making the great majority of the Bush tax cuts permanent. This is partly right but mainly wrong.I say partly right because I suspect to get the country’s finances in order we need still higher taxes. This goes well beyond saying people should pay higher taxes. I don’t want to pay higher taxes. I’m simply not convinced we can make the budget math work otherwise. On this front, actually caring out budgetary balance means something. It has consequences. On that front, we’ll see.
But this the idea that this is a 98% victory for the Bush tax cuts only works if you buy what’s really a bogus sales pitch. The political genius of the Bush tax cuts was that they really did cut taxes for almost everyone. And people tend to care a lot more about getting some savings for themselves than whether someone else is getting more savings than the country as a whole can manage. Such an effort may not garner huge support but it’s also unlikely to sustain much opposition. But the purpose of the Bush tax cuts was really for the high income earners — if not the 1%, maybe the top two percent of the country. The rest was part of the marketing push.
In any case, to say that Democrats were really against marginal rate reductions for middle class families is questionable at best. Especially since under Clinton and more recently under Obama they’ve pushed various tax rebates and cuts targeting people in the lower income tiers.
Now, a rejoinder to this claim would be that this is a partial or tendentious reading of the question. How do I know that the whole exercise was really about the top rates? Maybe that’s just my desire to believe the worst.
On that I’d say, look at what conservative policy people actually say. Not just what the arguments about rights and wrong but the arguments about intended policy outcomes. Then there’s where the intra-party interest groups line up.
But these points are perhaps debatable and secondary.
To really know what’s up, watch how people vote with their feet. Or to put it more simply, watch what people really do.
We’ve been through two years of budgetary trench warfare. And we’ve seen a more compressed form over the last month. If Republicans really believed Democrats were offering to concede 98% of the debate and substance of the Bush tax cuts, what would we be arguing about? That’s about as abject a surrender as you can imagine.
And yet, through the phony war of ‘deductions and not rates’ to the simple refusal to raise rates at any level to the on-going indifference or opposition to retaining various tax cuts that target middle or low-income earners, the entire drama has made one thing clear: IT’S ALL ABOUT THE TOP INCOME TAX BRACKET.
No matter how you slice it, whether it’s common sense or Occam’s Razor or really anything else, it all comes out the same: it’s all about the top rates. And that’s why Republicans continue to pull a plain old Charlton Heston ‘take these top Bush era rates from my cold, dead hands’ routine. And we end the day and the year not having seen the last of it.