Taxation and tax cuts aren’t my issue. I don’t claim to have done the research on their impact or lack thereof, I’ve seen all the same conflicting and contradictory studies you probably have.
That said, I know in my gut that the dumbest thing President Obama could possibly attempt to do at this juncture would be to screw with the middle class. Thankfully, his latest statement on making the Bush tax cuts permanent for people earning under $250,000 was a pragmatic one – a sign that he gets it.
From the Huffington Post:
His position, he said, is to work first on an extension of the tax cuts for those making less than $250,000 a year. After that, Obama added, Republicans and Democrats can debate or vote on whether to continue extending the tax cuts for the wealthy.
A very smart way for him to frame the debate, not all tax cuts are bad and middle class earners spend the money, unlike the über-wealthy who are more likely to just let it pile up with little benefit to the economy at large. Some more:
“My position is, lets get done what we all agree on,” said the president. “What they’ve said is, ‘We all agree that the middle-class tax cuts should be made permanent. Let’s work on that, let’s do it.’ We can have a further conversation about how they want to spend an additional $700 billion dollars to give an average of $100,000 to millionaires.
The permanent tax cuts for Million Dollar Babies is a separate issue and Obama is correct for drawing a distinction between the two. If he can get across to the American people that he favors lower taxes for the middle class and can show a willingness to ease the taxes on small businesses, then the “redistribution of wealth” attacks he faces will be greatly mitigated going into his party’s trial by fire this November.