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Right Turn
Posted at 08:23 AM ET, 12/15/2011

Surtax surrender by the Democrats

It must be disheartening for the left. Its dreamboat president talks a good game, but if you wait long enough he folds. Virtually every time. He agreed to extend the Bush tax cuts. He agreed to a debt-ceiling deal with no taxes. He now says, come to think of it, he won’t veto the defense authorization bill. And now the millionaires’ surtax, which was the hang-up on the payroll tax cut extension, is getting the heave-ho.

The Associated Press reports: “Democrats backed away from their demand for higher taxes on millionaires as part of legislation to extend Social Security tax cuts for most Americans on Wednesday as Congress struggled to clear critical year-end bills without triggering a partial government shutdown.”

Senate Minority Leader Mitch McConnell (R-Ky.) could barely disguise his delight that, once again, the White House had talked itself into a corner:

Republicans minimized the significance of the move. “They’re not giving up a whole lot. The tax they wanted to implement on business owners was something that couldn’t pass the House and couldn’t pass the Senate,” McConnell said in a CNBC interview.
Jettisoning the tax could also require Democrats to agree to politically painful savings elsewhere in the budget to replace the estimated $140 billion the tax would have raised over a decade.
In its most recent form, the surtax would have slapped a 1.9 percent tax on income in excess of $1 million, with the proceeds helping pay for the extension of tax cuts for 160 million workers. Senate Democrats have twice forced votes on the proposal in what officials have described as a political maneuver designed to force GOP lawmakers to choose between protecting the wealthy on the one hand and extending tax cuts for millions on the other.

Moreover, the XL Pipeline, according to Senate Republicans, is gaining traction. A senior Republican adviser told me, “More and more Democrats are supporting it.” And why shouldn’t they? It’s a no-brainer that marries North American energy development with job creation. Only the president’s desperate efforts to woo extreme environmentalists stands in the way. But he may wind up folding on this one, too.

It is apparent that despite the president’s over-the-top class-warfare rhetoric there is no appetite for it, even in the Democratic-controlled Senate. Obama repeats the same error over and over again: He is convinced his own rhetoric is both popular and effective. It’s neither, and more often than not it leaves him with egg on his face and his supporters with the sense they’ve been snookered in going to bat for the hapless president.

By  |  08:23 AM ET, 12/15/2011

Categories:  Budget

 
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