Congressional Black Caucus Voices Opposition to Tax Cut Deal. Their plan is much more sound than the President’s, and includes protection for Social Security.
In the tax deal, where do you stand? A point-by-point review of the pros and cons of the Obama-McConnell plan, which in my opinion makes the case for opposing it. Pay attention to this:
Economic forecasters are unanimous that the deal will prompt a modest additional increase in U.S. growth in 2011 and a small drop in unemployment. Goldman Sachs predicts that the gross domestic product will rise between 0.5 percentage points and 1 percentage point more than it would have without the package of tax cuts and jobless benefits. Macroeconomic Advisers says the deal could push American economic growth past 4 percent next year.
However, the additional debt burden created by extending the tax cuts and new spending will cause a long-term drag on GDP if Congress doesn’t act next year to reduce the deficit, the analysts added.
First, note that “growth” doesn’t mean anything if it’s all going into a few pockets. What we need is not just any kind of growth — especially if it’s only a modest increase. What we need is growth that will create jobs and help the people who are hurting right now. Second, note that the article gives no projected figures for unemployment. Appearing on NBC’s “Meet the Press,” the chairman of the White House Council of Economic Advisors “sidestepped a question on when the country would see a meaningful reduction in the unemployment rate.”1 That’s because this trickle-down approach is not going to address our unemployment problem, and everybody knows it.
Do Americans Support Obama’s Tax Cuts Deal? Depends How You Ask This is an important article by Jon Terbush pointing out how polling data is being used in this debate. When asked specific questions putting forth different alternatives, most Americans do not favor extending the tax cuts for the wealthy. This is important because even over on the Huffington Post, bloggers are using polling data to argue for the Obama-McConnell plan. See http://www.huffingtonpost.com/mark-penn/democrats-need-to-back-ob_b_795143.html by Mark Webb and “Washington: Extend the Tax Cuts to Create a Business-Friendly Environment” by Wendy N. Powell. Both are claiming that two-thirds of Americans support this package, and it’s safe to assume that both know exactly what they’re doing. They’re selecting the polling data that bolsters their case. Don’t be fooled.
Block Those Metaphors by Paul Krugman. “The point is that while the deal will cost a lot — adding more to federal debt than the original Obama stimulus — it’s likely to get very little bang for the buck.”
1 Katherine Skiba, “Tax cuts will pass despite Democratic uprising, Obama advisor says” in the Los Angeles Times.