The Tax Cut Trap for the Democrats

Posted: December 4, 2010 in Blame Bush, business, economy
Tags: , , ,

When the initial Bush tax cuts were proposed the making of the tax cuts temporary was a compromise that democrats and liberal republicans managed to forge to keep their constituents happy. If they could not stop the Bush Tax Cuts they could at least make them expire thus giving some consolation to their progressive followers.

Although Bush over and over suggested the Tax cuts be made permanent he could not manage to find the votes.

Now we come to 2010. The economy is bad and unemployment is rampant and now Democrats who were so proud to keep the Bush tax rates from becoming permanent find themselves trapped once again!

Once again the left is screaming “tax cuts for the rich” and their supporters are screaming for them not to cave in figuring that even after the republicans take control in a month they will not have the votes to get it passed.

Meanwhile Republicans are pushing to make the Bush rates permanent.

And so the white house and their advisers are leaning toward compromise, another extension, maybe two years of the Bush Tax Cuts. And thus the trap is set again.

The smart thing for the administration would be to pass the cuts NOW and make them permanent for several reasons.

1.  This will take the issue off the table, every time they simply extend the “Bush tax cuts” it sets up democrats in an election years to defend increasing taxes on business. (You know the folks who actually hire people.)

2.   As long as they are not permanent they remain the “Bush Tax Cuts”. Once they are permanent then they just become the US tax rates. Keeping them temporary keeps them associated with republicans and George W. Bush.

3.   If a democratic congress passes the tax cuts, then they not the republicans will get (and actually deserve) credit for the positive economic results. If it is passed once republicans are in power, republicans will get (and deserve) the credit for the results.

4.  If they are not passed and the economy gets worse (as the result of the tax hike) Republicans can directly blame democrats. Great issue for 2012.

5.   And finally if this is done NOW, then democrats have two years to placate their base. It will be over and done with.

Making the tax rates permanent would be not only the right thing but also the smart thing. That’s why I’m positive the democrats will fall right into the trap and simply vote for an extension at best. Given the chance to do the right or smart thing, the Democrats can be counted on to miss the boat.

I wonder if George W. saw all of this coming years ago and actually intended to set this trap for the left?

Update:
Crooks and Liars thinks the democrats have the GOP right where they want them. I’m telling you it’s just too easy. How do we ever lose elections to those guys?

Comments
  1. […] to compromise, and give the Democrats the provision they wanted that would let the tax cuts expire. Da TechGuy points out they’ve set the trap for themselves. Chances are they’ll extend the cuts for another two years, and then have to fight this […]

  2. Freddie says:

    ah yes… more of that bizarre argument of deficit increase if we don’t fiscally rape taxpayers for more money bit. Like I said to Larry W, that kind of thought is the same as a landlord saying to a tenant, “I charge your $1000 for that house. I should be charging you $1500 for that house, so for over the next 10 years, I’m losing $60K”. WTF? Your framing of the argument may play well with 8th grade mentality, Billy Bob. But not here. Instead of giving the beltway big spenders more cash to cover their proverbial butts, how about we demand they cut spending instead? But throw good money after bad policy is insanity.The taxes should stay status quo for all, not a select group. Increasing taxes in a recession is also insanity.

  3. […] This post was mentioned on Twitter by Peter Ingemi, Peter Ingemi. Peter Ingemi said: The Tax Cut Trap for the Democrats http://bit.ly/eyZLji #bushtaxcuts #taxcuts #economy #tcot hope we will have time for it on today's show […]

  4. […] rather have the deal in the pocket and make adjustments later if possible. If the dems want to walk into the trap I say let […]

  5. […] on the conceptI think Gov Palin is wrong on the Tax Deal « Da Techguy's Blog on The Tax Cut Trap for the Democratsdatechguy on Blog Anniversary and […]