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Mon Nov 26, 2012, 11:02 AM

OBAMA's Trojan Horse - No, He Won't Cave! - by David Corn [View all]

The Myth of the Obama Cave-In
With the "fiscal cliff" looming, the conventional wisdom is that the president capitulated during the last tax-cut fight. Here's what really happen


by David Corn

...................

Obama's aides, though, also knew that by the end of the year there would be some legislation regarding the Bush tax cuts—however that knotty issue was to be resolved—and they came up with a plan to turn this measure into something of a Trojan Horse that could contain (or hide) various stimulative measures. Before the midterm elections, Obama's economic team began compiling a list of possibilities, including a payroll tax cut and various tax credits.

............

Two years later, Obama still does not tell the story of that period well. In response to Yellin's question, he did not take explicit issue with her cave-in characterization:

Well, two years ago, the economy was in a different situation. We were still very much in the early parts of recovering from the worst economic crisis since the Great Depression. And ultimately, we came together not only to extend the Bush tax cuts, but also a wide range of policies that were going to be good for the economy at that point—unemployment insurance extensions, payroll tax extension—all of which made a difference, and is part of the reason why what we've seen now is 32 consecutive months of job growth and over 5.5 million jobs created and the unemployment rate coming down.


Yet Obama is right: the current circumstances are different, and after his reelection he is in a better position to do battle on the tax-cut front. He told Yellin:

What I said at the time is what I meant, which is this was a one-time proposition. And what I have told leaders privately as well as publicly is that we cannot afford to extend the Bush tax cuts for the wealthy. What we can do is make sure that middle-class taxes don’t go up.

In a recent White House meeting with labor leaders and progressive activists, Obama signaled he is ready to fight the GOPers—and this time dare the Republicans to block continuing the tax cuts for the middle-class. But no one ought to forget that Obama, a progressive in his policy preferences, remains a pragmatist. What happened two years ago is not an indication that Obama is likely to yield in the new face-off, but that he will be assessing the political dynamics in gridlocked Washington and be willing to bargain hard for a good deal with true benefits.

That's not caving in. It's governing.

much more:
http://www.motherjones.com/politics/2012/11/obama-fiscal-cliff-budget-deal-bush-tax-cuts?page=2

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Reply OBAMA's Trojan Horse - No, He Won't Cave! - by David Corn [View all]
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