Hendricks County Flyer, Avon, IN

November 20, 2012

GOP should take up Obama on his tax 'word'

By Taylor Armerding
CNHI

— Since President Obama won re-election, the talk now is all about "compromise" to avoid the so-called "fiscal cliff" of broad-based tax increases along with major cuts in spending, set to kick in on Jan. 1 if Congress can't agree on an alternative.

But, as is the case with just about every word regularly used in politics, "compromise" means very different things to different people.

The president's definition is roughly as follows: You (Republicans) agree to give away your major bargaining chip right away. And then we'll talk later about whether I might be flexible on anything.

In short, he wants Republicans to agree immediately to keep current tax rates in place for families with incomes less than $250,000 or individuals making less than $200,000. Later, he says he will "negotiate" on how much to raise taxes on "millionaires and billionaires" and supposedly on how to slow the growth of spending on entitlement programs so they don't bankrupt coming generations.

That sounds a bit like my favorite distortion of the "third-way" method of resolving conflict. You want A, I want B, and we compromise on C, a third way that allows both of us to get some of what we want, but also requires us to give up some of what we want. Obama's version is that he wants A, Republicans want B, and the third-way compromise is A, with some vague declaration that sometime in the future he might consider something that he will decide has elements of C in it.

The president and his supporters, some of the least gracious winners in history, are busy reminding everybody that he won the election. They're right. But if Republican Mitt Romney had won by the same margin, they would be busy pointing out that a majority that didn't even hit 51 percent is no mandate. And that would be correct too.

The president has to know that, despite his "great victory," he has not quite reached dictator status. Republicans still hold a majority in the House, and Democrats still lack a super-majority in the Senate. He has to know that if he continues with the arrogant swagger he has displayed since the election, his window to get anything done before he becomes a lame duck will close rapidly.

So, if he expects Republicans to give - and Speaker of the House John Boehner has indicated that his party is willing to do so - he needs to give as well. He needs to give something significant, not some trifle that doesn't matter and then try to spin it otherwise.

If he doesn't, he should not complain about "obstruction." As I noted last week, Massachusetts Sen. John Kerry, said to be under consideration as the next secretary of defense, said while campaigning for Senator-elect Elizabeth Warren that if Romney won the presidency, she would be needed to "block" his agenda. You know, actively try to cause him to fail - exactly what Democrats self-righteously condemned anytime it was aimed at Obama.

So, I'm here to bring both sides together - to offer a compromise rooted in one of Obama's favorite campaign lines. The president and his surrogates have been going on for years now about ending "tax breaks for millionaires and billionaires."

Republicans should take him at his word. They should agree to let the tax rates set under President George W. Bush expire for people who actually make more than $1 million.

The compromise for Obama, of course, will be to own up to the fact that he has never meant that. Every time he would talk about millionaires, in the next breath he would promise that your family's taxes won't go up if you make less than $250,000 ($200,000 for individuals). That, as the president surely knows, is not a million. People would have to make four or five times that much to be millionaires.

And that will expose the fact that, as the president also surely knows, raising taxes on millionaires and billionaires won't be enough to "pay down our debt in a balanced way" as he claimed all through the campaign - not nearly enough.

The president also knows that even if he gets exactly what he has demanded - increased taxes on everybody making more than $200,000, it won't be enough. Estimates on both sides of the partisan divide are that it might be enough to cut the current annual deficit by about 7.5 percent.

It might not bring in even that much. As a few Republicans have pointed out, not very successfully, Obama could set tax rates on the very wealthy as high as 90 percent, but if the current byzantine collection of deductions and loopholes remain in place, the rich will be able to dodge them.

But that argument will have to wait. Nobody will listen to it until government sticks it to the rich. Obama himself said even if raising taxes on the rich didn't bring in any more money to government, he wanted to do it, "as a matter of fairness."

So, Republicans should vote unanimously to let the Bush tax rates expire on millionaires, and let the president explain why it won't be enough. Only then will everybody be able to get to a conversation that has something to do with the fiscal realities facing the nation.

- Taylor Armerding is an independent columnist. Contact him at t.armerding@verizon.net.