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November 26, 2011 11:00 AM The looming GOP tax hike

By Steve Benen

Following up on the last item, all six of the Republican members of the super-committee wrote a joint op-ed for the Washington Post today, trying to avoid blame for the panel’s failure. There’s a lot of nonsense in the piece, but the gist is about what you’d expect: Democrats wanted the GOP to accept some tax increases as part of a balanced compromise, and Republicans refused.

There was, however, one tidbit in the op-ed that stood out for me. From the piece:

The 2001 and 2003 changes to the tax code reduced marginal rates for all taxpayers as well as the rates for capital gains, dividends and the death tax. For technical reasons, all of these provisions expire at the end of next year — meaning that if Congress does not act, Americans will face the largest tax increase in our history.

This prospect has put a wet blanket over job creation and economic recovery. It would be the wrong medicine for our ailing economy. As President Obama has famously said, “You don’t raise taxes in a recession.”

The six Republican co-authors of the piece are playing fast and loose with several key details, hoping the public won’t know the difference. For example, the mere possibility of tax increases in 2013 is not holding back the economy in 2011. That’s ridiculous.

But let’s put that aside for now and look at the argument at face value: these six powerful and influential Republican lawmakers are saying they’re against a tax increase in the short term, and believe such an increase would hurt the economy.

And that leads to a different question: doesn’t this mean these same Republican lawmakers will have to agree with President Obama’s call for an extension of the payroll tax cut, which is set to expire next month?

The White House is eager, if not desperate, for the payroll break to go through 2012, with projections showing weaker economic growth next year without it. Republicans have balked and said they want taxes to go up on practically all American workers in January because, well, they haven’t exactly explained why they want this. (To see how much your taxes would go up if Republicans succeed, the White House has put together an online calculator.)

And that leaves GOP lawmakers in an interesting position. On the one hand, they’re killing a super-committee deal because they refuse to raise taxes on the wealthy in 2013. On the other hand — indeed, at the exact same time — the identical Republicans have no qualms about supporting a tax increase on practically every American who earns a paycheck, which would kick in on Jan. 1, which is just six weeks away.

You see the problem. Republicans are afraid a tax increase affecting a small sliver of the population over a year from now is awful for the economy, but they’re comfortable with a tax increase affecting practically everyone a month from now.

The GOP message machine is an impressive operation, able to convince millions of people to not only believe nonsense, but oppose their own interests. But I’ll look forward to this message machine spinning Republican support for a major tax increase on working families nationwide during a jobs crisis and a weak economy.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

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  • c u n d gulag on November 26, 2011 11:08 AM:

    Here's how they'll explain it:

    Taxes on workers will be called "Patriot Taxes."
    What, you don't want to help your country, you great American?

    Taxes on the rich are always "Unpatriotic Job-destroying Taxes."
    What, you want to destroy your job and our country, you Socialist?

  • T2 on November 26, 2011 11:56 AM:

    "technical reasons". Yeah, a technical reason that all Republicans voted for...a small detail this band of crooks and liars forget to mention.

  • boc on November 26, 2011 11:59 AM:

    Steve, that is the best and clearest analysis I have read on the current situation.

    It's blatant. Now how do we get the Fox mouth breathers to know this?

    Thanks, that's really just excellent positioning.

  • N.Wells on November 26, 2011 11:59 AM:

    OK, the R's have received their talking points (no doubt tested with focus groups beforehand), and are once again trying to slam Obama for pursuing one of their own ideas.

    What has Grover Norquist had to say about failing to extend the payroll tax? So far, he has unfailingly found his way to opposing anything that even vaguely approaches a tax hike, but since this in no way helps the obscenely wealthy perhaps this time he will make an exception.

  • LL on November 26, 2011 12:16 PM:

    Steve. Please. You're joking, right?

    This is so easy, even I can write it: The GOP will blame the Democrats for the tax increase. And that's pretty much that.

    Of course, if the Dems had any brains or balls, they'd make it clear that, say, a smaller tax increase for the 99%, and a bigger increase for the 1%, would be the way to go. But Dems have no principles, far as I can tell, so they won't make that argument.

  • FriscoSF on November 26, 2011 12:23 PM:

    Sorry
    But, if Obama is re-elected in 2012....

    I don't really think he'll end the tax cuts for the rich

    I'm afraid he'll 'compromise' to be 'bi-partisan' and extend tax cuts for the rich
    Maybe in exchange for middle class tax cuts or to extend the debt limit

    Faith No More in Obama

  • SYSPROG on November 26, 2011 12:31 PM:

    Well FriscoSF, too bad for you, because this is the game we've got. We have a crappy economy, we have liars in the other party and we have Obama. He has my total support and faith. No Ralph Nader for me.

  • SW on November 26, 2011 1:16 PM:

    Well its simple really. "We don't want to do anything that will help the nigger in the White House".

    I am sure they are honest enough to come right out and say it. After all they are honorable men.

  • l on November 26, 2011 1:20 PM:

    Why? Everyone knows the why, a bank shot off the American worker to sink Obama in a corner pocket. And everyone knows the how, GOP just says no to everything Obama proposes. The results are that no one believes government works and the weak minded begin to think that Obama is weak. Even though the President has negotiated, cajoled, threatened and campaigned against GOP obstructionism Republicans haven't budged. The faint hearted, instead of rallying around Obama, scorn him and even sat out the 2010 congressional elections in retaliation for him not getting them single payer health insurance. So far the GOP has done everything right in their campaign to destroy America and Barack Obama.

  • qwerty on November 26, 2011 1:40 PM:

    The six Republican co-authors of the piece are playing fast and loose with several key details, hoping the public won’t know the difference.

    It's a safe bet. If/when it stops working, our country might start to recover.

  • Anonymous on November 26, 2011 1:41 PM:

    @FriscoSF never misses a chance to sow doubts about Obama. Wonder who s/he is working on behalf of?

    Don't forget how much good, progressive legislation Obama asked for, initiated and passed when he had a Democratic majority in both houses, despite the GOP's concerted obstructionism.

    The extension of the tax cuts was the price he agreed to pay to get the legislation through the 'lame duck' that achieved so many things. He ASKED his Democratic House to initiate tax cuts for the rich and to maintain the low rates for the other 99%. They refused, and they lost the House big time.

    But FriscoSF has a short memory--or else s/he hated what Obama accomplished. Which is it?

  • LosGatosCA on November 26, 2011 1:52 PM:

    Two things work in favor of the Republicans and they exploit them relentlessly:

    1. Tribal identity - by invoking this marker first, everything that follows is less powerful and less susceptible to cognitive dissonance. For conservative, Republican, TeaBaggers variations on selfish Randism, and it's sibling religious self-righteousness provide a strong selfish incentive to belong to the tribe that says you can be selfish, fully justified in being selfish, and your god insists you judge others harshly when they are inferior to yourself.

    2. Collective ignorance/confirmation bias - Selfish people don't want to think critically, only judgmentally. Once they lose or never develop that skill, they aren't open to any other interpretation of any message except it confirms their belief (the media is biased, my beliefs are fully substantiated, the superficial explanation may appear to favor the other tribe but on closer inspection it confirms my tribes view).

    The reasoning seems to be - the new information proves I'm right or the new information proves the messenger/media is a liar.

    It's a strong model of behavioral conformity based on willful ignorance born of selfishness. It's pretty hard to break - even for very highly educated, supposedly data driven professionals. The example of 'world class' economists counseling austerity and denying depression economics because of their political views and their consulting revenue stream is pretty hard to top.

    If they can't deal with facts effectively, there's really not much hope for lesser educated, less analytical, emotionally/religiously driven, less informed conservatives.

    Republicans use the same tried and true methods based on confirmation bias because there is virtually no critical thinking happening within their base.

  • burro on November 26, 2011 2:19 PM:

    "The White House is eager, if not desperate, for the payroll break to go through 2012,..." Mr. B.

    We'll see how desperate they are. They should be desperate enough for POTUS to get up in front of folks and call B.S. on the r's and explain to the people why the payroll break is good for them, and why the pooped out r alternative is rotten.

    The White House has resources to at the very least make an attempt to educate the people to help themselves by being encouraged to raise a stink that they are about to be screwed and really would rather not be. President Obama can go on the toob any time he wants and put his oratorical blessings to good use.

    The President, and every decent Democrat in this country has my support. What's the alternative, (real please, not symbolic)? But are Dems this totally helpless that the only plan can always to be curl up in a ball and call the r's amoral meanies?

    Speak POTUS. Tell the country when, where and how they are going to be screwed. Time and again, the vaunted r's messaging "machine" is shown to be a thin veneer when it's confronted with truth in a way that can't be ignored for longer than a single news cycle. Let desperation ring. Let B.S. be identified in a way that rises above the constant background noise.

    We'll see how desperate they are.

  • jcricket on November 26, 2011 3:23 PM:

    Republicans don't give a rat's ass whether the payroll tax breaks help with working class. The working class is not their constituency.

    Unlike other taxes, the payroll tax is capped. The 1% (the real republican constituency) reach the cap within the first couple of pay periods in the year, if they even earn via a payroll at all. Maybe some do at a nominal level.

    This is part and parcel of their scorched earth political methodology. They will gladly be a mechanism by which the economy is ruined, just so they can point to the ruins.

  • rrk1 on November 26, 2011 4:11 PM:

    As impressive as the Rethug mighty Wulitzer message machine is, so is the Democrats pathetic lack of any message machine shamefully woeful.

    I had dinner last night with the right hand of our Secretary of State. My dinner companion was rolling her eyes and lamenting the White House operation, which she said was all but clueless when it came to messaging (among other things). Nothing new there.

    The Democrats on the hill have no message. The White House has only a sporatic one, and the Rethugs use the corporate MSM as their press agency. The dumbed down public hears the sound bites, and decides both sides are at fault for everything. Goebbels is laughing somewhere.

  • samsa on November 26, 2011 4:55 PM:

    @mrk1

    It's worse than that.

    If White House is criticized for not having an effective message machine, the leftist Obama bootlickers come out of the woodwork to prove by their exalted analyses that 'even if Obama had given a good speech, nothing would have changed'.

    I call that the ant-message machine.

  • pea on November 26, 2011 5:03 PM:

    Steve,

    A belated thanksgiving for all you do. Today's pieces (as usual) illustrate how you contribute to public discussion of policy and politics (which the MSM too often fails to do -- do they even know how to treat it as more than a sport??) through documentation and analysis, ...

    reminding us of "history" -- i.e. relevant previous events or positions taken (busy people tend to forget or miss such things or not see the forest for the trees at times) that relate to today, and

    spelling out the logical (or all too often, illogical) connections between positions or events, of which the GOP hopes the public remain unaware.

    Keep up the good work and your sense of humor. You manage to attract commenters with interesting, informative, and/or witty insights, a lot deeper than those at many other sites. Our continuing "assignment" is to pass on your work to others. Long live your blog. It keeps some of us from going totally bonkers and just giving up.

  • exlibra on November 26, 2011 6:11 PM:

    [...] Republicans have no qualms about supporting a tax increase on practically every American who earns a paycheck,[...] -- Steve Benen

    People who "earn a paycheck" are just worker bees; they form unions, can't pay for their own damned healthcare and, half the time, can't even be bamboozled into voting Republican. So eff them and the steerage they came here in. The real American heroes -- the job creators -- live off their investments (taxed at the preferential, lower rate for that very reason), not some piddling paychecks. And their taxes are not to be raised, ever, or the yacht, jet, and luxury car industry might falter.

  • exlibra on November 26, 2011 6:43 PM:

    Here's how you, too, can avoid paying taxes. But you have to make a couple of billions, first:
    http://www.nytimes.com/2011/11/27/business/estee-lauder-heirs-tax-strategies-typify-advantages-for-wealthy.html?hpw

  • samsa on November 26, 2011 6:48 PM:

    Republicans are a*holes, so I don't care about them.

    What I don't understand is the rich.

    During the period 1961-2011, there have been 28 years of Republican Presidency, and 23 years of Democratic presidency.

    During the Republican Presidencies, the SP500 rose by annualized rate of 3%. And so a rich man would have increased the value of his investments by a factor of 229% when Republicans were Presidents.


    During the Democratic Presidencies, the SP500 rose by annualized rate of 10%. And so a rich man would have increased the value of his investments by a factor of 895%. Even if the evil democrats raise taxes to take away half of these gains (they don't), the wealth grows by a factor of 445% under Democrats as opposed to 229% under Republicans.

    Given these hard numbers, is a mystery why the rich support the Republican.

  • Texas Aggie on November 26, 2011 7:54 PM:

    "For technical reasons, all of these provisions expire at the end of next year "

    Those technical reasons being that when Bush and the regressives passed the tax cut in the first place, they had to pretend that it wasn't going to cause a massive deficit, so they put in the bit about it not being permanent. Now when it comes time to go back to what it was before, they all of a sudden forgot about their deficit worries.

  • Rudy Gonzales on November 26, 2011 8:00 PM:

    The current crop of TEA-GOP-Republican candidates that mean business is the same puppeteer-controlled bunch who have compromised their sovereignty, independence and integrity. Everyone of the TEA-GOP-Republican candidates have signed a pledge to Grover Norquist, Bob Vander Plaats, Edward H Crane and David Keene, and other puppeteers, rather than honor their commitment to the constituents in their respective districts. All constituents require representation. The budget impasse and repeated contentiou­s bickering over taxation increases to the most affluent of America, has side track­ed the real issues. It has always been about jobs, jobs, jobs. Americans need new blood with kahunas to exact America's people's needs, not the wants of the elite few. We know The concentrat­ion of wealth in the hands of fewer and fewer people and the concentrat­ion of power in stricter, less compassion­ate hands in all aspects of local, state and the federal government. It's always been about jobs, jobs, jobs. Someone once said, "It's the economy stupid!" The biggest reason the TEA-GOP-Republican debates matter less and less these days is there are all the same. A stage to sound off against president Obama.

  • pj in jesusland on November 27, 2011 4:16 AM:

    Republicans are re-fighting all the old issues from the 1920s and 1930s: progressive income tax; rights of unions to organize; child labor laws; public education; evolution; bank regulation; Glass Steagal; international cooperation; Keynsian stimulus programs; nativism. Add in a couple of newer issues like family planning and global warming and you basically have the Republican platform of 2012.

    Like Hoover the current crop of Republicans don't care what the predicted impact of their policies will be on America as long as they are the ones who get to decide it. For them, it's not about what works, it's all about control. If some of their positions are contradictory their attitude is who cares as long as they maintain their funding pipeline to rich donors.

    It's totally cynical.

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