The costs of the Obama-GOP tax deal

By Michael J.W. Stickings

The Senate voted yesterday to end Bernie Sanders's admirable filibuster and to send the Obama-GOP package to the floor for debate and a final up-or-down vote.

The vote was overwhelming: 83 to 15. (Nine Democrats, five Republicans, and one independent (Sanders) voted against it.)

An initial critic of the deal, I now go back and forth. In principle, I'm still against it. But what is principle? The reality is that Obama needs this (and we still care about his 2012 re-election, right?) and for the most part the American people need this. At the very least, given the continuing poor state of the economy, the stimulus that Obama won in exchange for extending the Bush tax cuts for the wealthy is critical. (For more on this, see our two guests posts by Nicholas Wilbur here and here. He makes a persuasive case.)

This is what happened with health-care reform. I wanted more, like so many others, but I nonetheless ended up supporting the bill. It was much, much better than nothing, and a lot was achieved.

Can that not be the case here? It will be, if Obama follows through on his promise not to extend the Bush tax cuts for the wealthy past 2012. If he stands firm, this will be, as Jonathan Chait puts it, "a huge victory." (And if he doesn't? Then this will be "a massive defeat." The president hardly inspires much confidence these days, particularly within his base, but there's good reason to believe that he will stand firm. I just hope I'm not trying to convince myself of this at the risk of looking stupid when, as so often happens, Obama and the Democrats give in once again to Republican demands.)

Anyway, Chait posted a couple of helpful charts yesterday -- one from the White House and one from MoveOn.org:

The first looks good (for our side), the second looks bad (for our side) -- if, in the latter case, the Bush tax cuts for the wealthy are extended (contra Obama's pledge).

So which one is right? Well, we'll have to see -- time, and politics, will tell. There is no doubt that making the deal entails significant risk for Obama and the Democrats.

But Chait is right, I think, that "the liberal revolt does help demonstrate the costs the administration will pay if it capitulates on the upper-bracket Bush tax cuts in 2012."

For that, I fear, there would be no excuse, and the president would deserve to be held accountable for such costly failure.