Bernie Sanders finally yielded the floor this evening after an all-day speech against the White House's tax-cut plan. He could have saved himself a lot of effort if he had just read Charles Krauthammer today. The Post columnist concluded, in his usual neutral-minded spirit of good faith, that the agreement to protect millionaires and billionaires from paying taxes is secretly a triumph for Obama's unwavering socialistic vision.
So why was pinko Bernie carrying on about yachts and heating bills? The truth, according to Krauthammer, is that the moneyed interests are getting rolled:
At great cost that will have to be paid after this newest free lunch, the package will add as much as 1 percent to GDP and lower the unemployment rate by about 1.5 percentage points. That could easily be the difference between victory and defeat in 2012.Stupid left! The Republicans agreed to betray their deeply held principles of fiscal responsibility, and all they get in return is tens of billions of dollars carved out of federal revenue and given to rich people. This is terrible for the budget, which is the most important thing to Republicans, except for when the budget had to take a hit for George Bush to get those tax cuts to begin with. How did that sly Obama get the Republicans to forget their core values?
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The left never understood that to nationalize health care there is no need for a public option because Obamacare turns the private insurers into public utilities, thus setting us inexorably on the road to the left's Promised Land: a Canadian-style single-payer system. The left is similarly clueless on the tax-cut deal: In exchange for temporarily forgoing a small rise in upper-income rates, Obama pulled out of a hat a massive new stimulus - what the left has been begging for since the failure of Stimulus I but was heretofore politically unattainable.
He preyed on their emotional vulnerability, that's how—offering to protect them from his party's left flank. As David Brooks helpfully pointed out on the New York Times website earlier this week, the Democrats have been recklessly indifferent to Republicans' fears on this whole tax thing:
We’re in a horrible economic climate. The entire business community thinks the government is out to destroy them. Do we think raising taxes on small business people is going to improve their willingness to invest and take risks?It must be awful to be in business in America now. David Brooks' small business owners—the small business owners who are clearing more than $250,000 each year in profit (not revenue, pace Joe the Plumber: profit)—are painfully conscious of being hated. Raising tax rates on them would be insensitive at a time like this. It's like Mort Zuckerman warned us: if rich people don't feel appreciated, they'll stop participating in our economy altogether.
In other words, the economy did fine in the Clinton years with a 39 percent rate. Eventually, we should return to that. But this is not the moment to take another sledgehammer to market psychology.
I’m actually a little depressed by Democrats’ inability to think dynamically about this. Yes, the rich have made a ton of money over the past decades. They could probably afford to pay more. But some percentage of them really, really cares about tax rates and those people will change their behavior if they think the U.S. hates business and if they think they won’t get to keep their profits.
Money is fearful these days; it wants to huddle together with other money. Don't traumatize the money by making it get out there and circulate among people who don't have other money. It will just get spent and shoved around from person to person, like an unwanted foster child.
Why can't the Democrats think dynamically? Times change. That 39 percent tax rate that was good enough under the Clinton Administration is scary and insulting in the world of 2010. That liver transplant for a poor person is a pointless luxury. We are in an economic crisis and a budget crisis. Yes, if you go to the budget calculator and click all the options for Return Tax Rates to Clinton Levels and for Let Bush Tax Cuts Expire, the five-year budget crisis basically disappears. But that is old-fashioned, static thinking.
No, don't dwell how things were on the past. Charles Krauthammer doesn't. If the Republicans don't go ahead and cave to this piece of extortion by the White House, he writes, the estate tax "jumps insanely from zero to 55 percent on Jan. 1." Insanely! And what's Krauthammer's adverb for what happened the previous January 1, when the rate dropped from 45 percent to zero?
So Republicans, big-hearted dupes that they are, will grit their teeth and allow some poor people to become slightly less poor for a while, even though it is bad for the country. They know that if they don't, the White House will refuse to protect rich people from becoming slightly less rich. And that would be the end of America as we know it.
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