Since former president George W. Bush passed tax cuts for the wealthy in 2001, Barack Obama vocally made it his sole mission to reverse the tax policy during his campaign and career as president since 2008.
Unexpectedly, the long battle over the financial policy has led Obama to strike a deal with the GOP that would let the Republicans extend their precious tax cuts for two more years in exchange for a 13-month extension of unemployment insurance benefits.
According to Ezra Klein from the Washington Post, Obama and the GOP came to an agreement that the GOP would get around $95 billion in tax cuts for wealthy Americans and $30 billion in estate tax cuts. Democrats got $120 billion in payroll-tax cuts, $40 billion in refundable tax credits (Earned Income Tax Credit, Child Tax Credit and education tax credits), $56 billion in unemployment insurance, and, depending on how you count it, about $180 billion (two-year cost) or $30 billion (10-year cost) in new tax incentives for businesses to invest.
Unfortunately, House Democrats have nothing but utter disdain and fury over the compromise and put out a flurry of complaints, saying Obama gave in too quickly to the GOP.
“I still don’t think it’s in the best interest of our country, I really don’t,” said Sen. Tom Harkin (D-Iowa). “I just don’t think we fought hard enough. I disagree with the president. He had a press conference and called it a political fight. It’s not a political fight, it’s a fight about what our country is about.”
Sen. Bernie Sanders (I-Vt.) vowed on Tuesday night to filibuster what he called a “very bad agreement,” while Sen. Frank Lautenberg (D-N.J.) said: “I think a ransom was paid and it was a very high price,” according to a report from The Hill newspaper,
Meanwhile, Obama stood firm and hit back at his own party for wallowing in politics in a Tuesday press conference on Dec. 7, 2010. Claiming the deal was all for the sake of the American people.
“My number one priority is to do what’s right for the American people, for jobs, and for economic growth. I’m focused on making sure that tens of millions of hardworking Americans are not seeing their paychecks shrink on January 1st just because the folks here in Washington are busy trying to score political points,” Obama said and also continued to stress the importance behind his decision.
“I’ll cite three of them. Number one, if you are a parent trying to raise your child or pay college tuition, you will continue to see tax breaks next year. Second, if you’re a small business looking to invest and grow, you’ll have a tax cut next year. Third, as a result of this agreement, we will cut payroll taxes in 2011, which will add about $1,000 to the take-home pay of a typical family,” Obama said. “So this isn’t an abstract debate. This is real money for real people that will make a real difference in the lives of the folks who sent us here. It will make a real difference in the pace of job creation and economic growth. In other words, it’s a good deal for the American people,”
I believe the President was very genuine with the reasons he gave for compromising with the GOP. Even 67 percent of Americans get why Obama did what he had to according to the Politico polls.
After a ridiculous amount of overspending on the war in Iraq and Afghanistan for over seven years, George W. Bush left the American economy in major financial crisis, leaving a heap of shit for Obama to clean up. The tax cuts have only been Bush’s retribution and have been welcome in the American economy given the devastation of the recession and unemployment. However, not everyone deserves these tax cuts especially these dishonest wealthy corporate businessmen who already cheat on their taxes. Middle income families that are struggling to get by- do.
I understand the frustration of the Democratic party with the extension of the tax cuts because they were supposed to expire at the end of nine years. However, Obama is not to blame. The GOP went back on their word and made this their number one agenda. The Republicans opposed every measure Obama took to end the tax cuts so he did what could. I understand he campaigned to end the tax cuts for the rich since 2008 but he has until 2012 to deliver on his promise. Until then, Democrats should understand the compromise is better than nothing.