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Obama’s winning message on taxes?

at 02:30 PM ET, 04/18/2011


Can President Obama successfully sell a message of tax increases for the wealthy? Mark Wilson/Pool via Bloomberg
President Obama will head out on the road this week, making stops in Virginia, California and Nevada to begin the sales effort of the debt reduction plan he outlined last week.

The most contentious element of the plan to date is his pledge to not extend the Bush era tax cuts for the wealthiest Americans — those making $250,000 or above.

House Speaker John Boehner, before the President even delivered his speech last week, came out in opposition to any plan that would raise taxes — calling it “unacceptable” and a “non-starter”.

While Democrats do traditionally shy away from tax talk — for fear of being labeled “tax and spend liberals” by their Republican opponents — there is some polling evidence to suggest that President Obama can win the tax fight if he keeps his rhetoric and proposals focused squarely on corporations and the wealthy.

New number from Gallup suggest the political opening that exists for President Obama.

With nearly six in ten Americans voicing the belief that wealthy Americans don’t pay their fair share of taxes — and nearly seven in ten saying the same of corporations — President Obama is preaching to the choir when he advocates the end of the Bush tax cuts for upper-income families.

Looking deeper into the numbers provides more evidence that suggests Obama can win on the tax fight. Two-thirds of those making under $100,0000 a year believe that those in the upper-incomes are not paying enough in taxes.

Those middle-class people are a huge target in any election but particularly one where the economy will be a central issue. If Obama can use the idea of rescinding tax cuts for the wealthy to appeal to middle class voters who feel as though they are forever on the short end of the stick, it could have significant electoral consequences next fall.

Or not.

David Winston, a Republican pollster who works closely with congressional leaders, argued that while Obama could score points bashing the wealthy and corporations, he will ultimately lose the tax tussle.

“People believe increasing taxes hurts economic growth,” said Winston.

(Recent polling on that question is sparse; a Gallup poll last November showed 31 percent of people said that the “best approach” President Obama could take in dealing with the economy was to raise taxes on the rich. It was the second most popular choice; 39 percent cited reducing the debt/deficit.)

Winston added that when the tax debate heats up over the coming months, several facts — the U.S. corporate tax is the highest in the world and ending the Bush tax cuts on those earning $250,000 and above would impact 894,000 small businesses to name two — that aren’t widely known by the public will help Republicans ultimately win the tax debate. (A recent study by PriceWaterhouse Coopers LLP put the U.S. corporate tax rate as sixth highest in the world; Winston was citing data from the Tax Policy Center, a joint project between the Brookings Institute and the Urban Institute.)

The question for Republican strategists is whether the underlying dynamics of the tax debate have shifted in recent years — amid rising concerns about spending and debt — in a way that makes the issue far less of a slam-dunk win for them in political terms.

In the NBC/Wall Street Journal poll conducted earlier this month, 32 percent of people said that Republicans were better equipped to deal with tax issues while 30 percent chose Democrats. (Another 17 percent said both parties were equally able to handle tax matters while 20 percent said neither were.)

That slim Republican advantage stands in stark contrast to where things stood in a March 2010 NBC/WSJ survey that put Republicans 11 points up on Democrats on the tax trust question.

It’s far too early to draw any broad conclusions about where the tax fight is headed politically over the next year. But with President Obama sending signals that he will not back down on his pledge to end the tax cuts for those making $250,000 and above and Republicans digging in on the idea of not raising any taxes to help bring down the deficit, we are headed for an epic political clash with major implications for the 2012 presidential contest.

 
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