Category: Class War

The nefarious payroll tax cut

~ susie ~ 10 Comments

Here are all the “enemies” of Social Security who are pushing this “regressive” idea. Maybe, just this once, we could give Obama the benefit of the doubt:

  • Robert Reich, former Secretary of Labor, (Aug. 25, 2010): “But here’s an idea that might command everyone’s support: Eliminate payroll taxes on the first $20,000 of income.”
  • Noam Scheiber, The New Republic, (Oct. 29, 2010): “One obvious basis for discussion here would be a proposal by Larry Lindsey, George W. Bush’s first White House economic adviser.Lindsey has spent the last 20 months urging a two-year halving of the payroll tax for both workers and businesses.”
  • Ezra Klein, Washington Post, (Sept. 3, 2010): “The White House is considering a push for hundreds of billions of dollars in new stimulative spending, focusing on business tax cuts including a temporary cut in payroll taxes. In part, this is good policy. In part, it’s necessary policy.” Klein has also supported a payroll tax cut more recently (Sept. 10 and Nov. 3, 2010).
  • John Podesta, President and CEO, Center for American Progress (Nov. 7): The question is whether [the President] can offer the Republicans something in exchange. I think one of the ideas that — that he could substitute for tax cuts for the very wealthiest Americans is perhaps a payroll holiday, which the Republicans have endorsed, which would actually create more jobs.
  • Laura Tyson, Former CEA Chair to President Clinton on Face the Nation (Sept. 5, 2010): “I think that’s correct. I think that we already have in place the credit. The credit can be extended or could be extended into a partial payroll tax holiday.”
  • Matt Miller, Senior Fellow at the Center for American Progress, in his Washington Post Column (Sept. 8, 2010): “Ask any economist or businessperson what kind of tax cut would be the biggest boost to job creation and the answer is clear: a cut in payroll taxes, because it would directly reduce the cost of employment. Ask any social justice champion which tax is the unfairest tax of all and the answer is clear: the payroll tax”
  • Arianna Huffington Interview (Oct. 11, 2010): “I mean no dramatic bold proposals are going to come out of Washington of the kind I am suggesting in the book like the payroll tax holiday,huge infrastructure projects…”

Heh

~ susie

Matt Taibbi has a hysterical takedown of Times reporter Matt Bai, and how David Gergen confused him with Bai.

I’ve met Matt Bai. If you remember, I attacked him for half-assed coverage in the same piece last week, so this is pretty funny:

Bai is one of those guys — there are hundreds of them in this business — who poses as a wonky, Democrat-leaning “centrist” pundit and then makes a career out of drubbing “unrealistic” liberals and progressives with cartoonish Jane Fonda and Hugo Chavez caricatures. This career path is so well-worn in our business, it’s like a Great Silk Road of pseudoleft punditry. First step: graduate Harvard or Columbia, buy some clothes at Urban Outfitters, shore up your socially liberal cred by marching in a gay rights rally or something, then get a job at some place like theAmerican Prospect. Then once you’re in, spend a few years writing wonky editorials gently chiding Jane Fonda liberals for failing to grasp the obvious wisdom of the WTC or whatever Bob Rubin/Pete Peterson Foundation deficit-reduction horseshit the Democratic Party chiefs happen to be pimping at the time. Once you’ve got that down, you just sit tight and wait for the New York Times or the Washington Post to call. It won’t be long.

Comedy gold! But on to the actual critique:

So in other words, those of us who think robbing Social Security a second time to pay for the continuation of the obscene Bush tax cuts — well, that’s “demanding fealty to the one” and “brooking no dissent” and lacking “thougtfulness and openness to new ideas.”

On the other hand, approving those Social Security cuts and green-lighting the continuation of those insane tax breaks — tax breaks that were extremely radical even by Republican standards when Bush originally passed them amid two preposterously expensive war efforts — well, that’s being “pragmatic” and seeing “all dogma ” as “anachronistic.”

Here’s what this all comes down to, dogma or no dogma: who is going to pay for a) the Bush tax cuts b) the bank bailouts and c) the Iraq and Afghanistan wars? If you want to get there by making janitors and pipe-fitters wait until they’re 69 to retire, raise your hand. If you want to get there by making Jamie Dimon rent out his 900-foot rooftop terrace in Chicago two nights a year, raise your hand.

The really infuriating thing? Bai has it backwards. The real consensus, i.e. the consensus of actual human beings, outside Washington, overwhelmingly backs the idea of not fucking with Social Security benefits and ending the Bush tax cuts for people making more than $250,000. In fact, only 26% of Americans support extending the cuts for everybody.

So when Bai talks about “bipartisanship” and suggests that extending the Bush cuts is a move to the center, what he’s talking about is the Washington consensus.

In some very vague way I suppose it could be argued that Barack Obama crawling into bed with John Boehner represents “post-partisanship,” but if you want to talk about building actual political bridges, the only meaningful way to achieve that is through the union of voters on the left who want to end the Bush tax cuts, and the voters on the right who want to end the Bush tax cuts. Unite the elderly Democrats who want to hold on to their Social Security Benefits and the elderly Republicans who want the same thing. That’s bipartisanship, but not in the way these Silk Road types like it.

Isn’t it ironic

~ susie ~ 16 Comments

Don’t ya think? I’m not usually in so rarely in the position of defending Obama, so I’m sort of detached from this morning’s outrage (my blood pressure’s fine, for a change). Steve Benen came to the same conclusion I did: It’s just not that bad.

Krugman: Not as bad as expected, still not worth it.

Atrios: Deal is much stronger for jobs than anyone expected.

Ezra Klein: Something for everyone, something to annoy everyone. He also says it was a meaningful compromise, a breakthrough of sorts.

Matt Yglesias: The real tax-cut sellout was two years ago.

I was talking to one well-known writer-activist last night who said he thought it was odd that the UI extension was being “shrugged off” by so many. I agree. I think a lot of the online bloggery outrage is being fueled by people who don’t have a visceral understanding of what it’s like to be at the end of your financial rope. (Class matters.)

With this president, with these Republicans, at this time, I think this is approximately as good as it can get. There will be changes before the deal is approved (it would be swell, for instance, if Bernie Sanders held out for the 99ers), but this is about what it’ll look like.

And for the people who can breathe, knowing they can survive for another 13 months, that’s a good thing.

Now let’s see how much better (or worse) our half-assed Congress can make it. The payroll tax holiday? A real sand trap for Social Security. Let’s see how far it gets.

Here’s the tax cut deal

~ susie ~ 11 Comments

Senior administration officials talked to bloggers tonight after President Obama addressed the nation on the results of the extortion negotiation with the Republican leadership, and I have to tell you, I’m not all that unhappy with the results. This is an actual compromise deal. (And, as I’ve said before, giving tax cuts to the rich is the best insurance policy we can get for Social Security.)

First of all, the unemployed who are still collecting benefits get to heave a sigh of relief, because they’re covered for the next 13 months. (I did ask about the 99ers. Sorry, nothing. Apparently we’re still invisible. I also said if they were still in negotiations, they might want to considering exempting unemployment benefits from the income tax, the way they used to before Reagan.)

But that’s not all. The package includes a shiny new one-year 2% payroll-tax cut for employees, which will stimulate the economy because the people who get it are the ones most likely to spend it. Thumbs up on the payroll-tax cut!

It also includes a fix to the Alternative Minimum Tax.

The aforementioned millionaires and billionaires do get their tax cuts — but only for two years. (That will cost us $95 billion, by the way, and will be financed by borrowing from China.) But they’ll have a merry Christmas anyway, because of the jingle in their pockets from (you knew this was coming) reinstating the estate tax with a $5 million exemption. (The officials said that issue will be fought again at a later date.)

If the president had his way, one of the officials said, they would only be making the middle-class tax cuts permanent, but it “wasn’t possible to get through. If there was a compromise, though, he wanted lots of other pieces included.”

Bottom line, as the officials pointed out, if he didn’t deal with the Republicans, they would have dragged this out for “months and months and months,” and there was a good possibility they wouldn’t get any UI extensions at all.

Honestly, I don’t care that he promised not to raise these taxes. With a gun to his head, he didn’t have much choice. But Obama needs to learn that an occasional piece of cheese from the Republican rats doesn’t mean a new era of understanding.