The Fireside chat for December 11th, 2010 (VIDEO)

The President (thanks again to Fireside special guest host, Vice President Biden!) strongly urges both parties in Congress to pass the compromise on tax cuts, unemployment insurance, and job creation. Not doing so would hurt the middle class, those struggling to find work, and the economy itself.



Remember when Krugman said that we tried to fill a $2 trillion dollar hole in our economy with $787 billion worth of Infrastructure projects and tax cuts?

Well, he was right. That wasn't enough. It was just enough to stop the slide. (Remember, no how much Krugman's columns may or may not annoy you, the man is a Nobel Prize winner in Economics. He always gets his Economics numbers right. His political sense leaves much to be desired, but whenever you read his stuff, you have to keep these two ideas in your head. He can be right about numbers, and usually wrong about the Politics.)

And he was certainly wrong about was being able to get more through that Congress. A one $1.2 Trillion dollar Stimulus even though $2 trillion is need? Naaahhh. Big numbers scare those guys.

But if you think about it, maybe Professor Krugman was right. More Stimulus is about to pass the Congress, it just didn't happen at the beginning of the President's term when it should have.

However you feel about the coming Tax Cut Deal, remember its another $700 billion stimulus. Still too much in Tax Cuts for the rich, but a lot in Tax Cuts for everybody else.

So now, after this deal passes...and longtime reader Charmed86 is right (waving hi!), it's gonna pass...we will have filled 1.5 Trillion of the 2 Trillion dollar hole Krugman talked about.

If we got back to 2.2 growth with just the original Stimulus...what will adding this Stimulus do to that number?

The President just bet his Presidency that it will...

I think it will, too. Question is, does it go up enough?

The What We Got / What They Got Chart that's making the rounds (Great Minds Edition)

Steve Benen:

Though it doesn't seem to come up as much as I thought it might, the question of why Republicans would go along with a plan like this is pretty easy to answer: the GOP really does prioritize tax cuts for the wealthy above all. These breaks are so important to them, they'll accept a breakdown that allows that column on the left to be quite a bit higher than the one on the left.

Which follows up something Ezra Klein said before:

4) Republicans really, really, really care about tax cuts for rich people. Many Democrats had been operating under the theory that Republicans would simply obstruct everything Democrats attempted, as that was the best way to make Obama a one-termer. At least when it comes to tax cuts for very wealthy Americans, that's not true. Republicans agreed to far more in unemployment insurance and stimulus proposals than anyone expected, and sources who were involved in the negotiations agree that the mistake Democrats made going in was underestimating how much Republicans wanted the tax cuts for the rich extended.

And to rehash what David Corn said (extended dance mix!):

So at this late stage of the game, in the dwindling moments of the 111th Congress, should Obama have been willing to put those Americans on the line in order to do battle with the nefarious Republicans? Had he done so and won (forcing the GOPers to forgo the the tax bennies for the rich and to accept tax cuts and benefits, including unemployment insurance, for others), he would have saved the nation a lot of money and not established some dangerous precedents (such as the more generous exemptions for the estate tax). He would have served several valuable principles: We don't pay off the rich to help struggling Americans; we don't negotiate with hostage-takers. It would have been glorious. But had he failed, he might not have been able subsequently to work out a deal with the benefits of this one. As the nation has learned, the Republicans cannot be shamed into supporting measures that help besieged Americans -- but they can be bought off.

Erza Klein: Lessons learned from the Tax Cut Deal

Great column by Ezra, and an important read, he's got more.  No. 1 is my favorite.

1) No one really cares about the deficit. No sooner had Alan Simpson and Erskine Bowles completed their work on the deficit reduction package than Democrats and Republicans reached a bipartisan accord to add $900 billion to the debt. Republicans wanted their unpaid-for tax cuts for the rich, Democrats wanted their unpaid-for stimulus measures and both sides wanted the unpaid-for tax cuts for income under $250,000. I think it's appropriate to spend while the economy is weak and then repay when it's strong, but then, I didn't just get elected to Congress by promising to rein in spending.

2) Obama is better at the inside game than the outside game. Sarah Palin likes to ask the president "how that hopey-changey stuff" is going. The answer, it seems, is that the changey stuff is going well, but the hopey stuff is proving more troublesome. Obama might have campaigned in 2008 as the inspirational newcomer who had no patience for the broken ways of Washington, but he has governed like a Washington veteran with little patience for inspired outsiders. In health-care reform, in the stimulus, in financial regulation and in the tax-cut deal, Obama has been a tough negotiator able to move his agenda through a gridlocked Congress - but he has not been able to enthuse Democrats or inspire popular support for his initiatives. He has been prickly when questioned about it.

3) And he's not over health-care reform. Among the president's most passionate moments during the post-deal news conference was his long, impromptu scolding of dissatisfied progressives who're making this into "the public option debate all over again." Obama went on to complain that liberals were so focused on the public option that they lost sight of the rest of the health-care bill - which was much larger. And he's right about that. But it's also time for him to get over it.

4) Republicans really, really, really care about tax cuts for rich people. Many Democrats had been operating under the theory that Republicans would simply obstruct everything Democrats attempted, as that was the best way to make Obama a one-termer. At least when it comes to tax cuts for very wealthy Americans, that's not true. Republicans agreed to far more in unemployment insurance and stimulus proposals than anyone expected, and sources who were involved in the negotiations agree that the mistake Democrats made going in was underestimating how much Republicans wanted the tax cuts for the rich extended.

5) It's still Ronald Reagan's world, at least when it comes to taxes. The Sturm und Drang over the tax cuts for the rich obscured the Democrats' massive capitulation on the tax cuts for everyone else. Even the party's liberals had accepted Obama's argument that the tax cuts for income of less than $250,000 - which includes the bulk of the Bush tax cuts - should be permanently extended. Another way of saying that is Democrats had agreed that the Clinton-era tax rates were too high. If you put it to most Democrats that way, they'd protest vigorously. The economy boomed under Clinton, and the Democratic Party is proud of the efforts it made to balance the budget. But Democrats are so terrified of being accused of raising taxes that they've conceded to the Bush tax rates for 98 percent of Americans.

6) We need tax reform, now more than ever. The end result of this deal is going to be an even weirder tax code than we have now - and the one we have now is pretty weird. We're extending old tax cuts and credits and adding new ones. Some of those may be extended further. Businesses won't want to see deductions for investments expire, and workers won't want to see the payroll-tax cut expire, and the super-rich won't want to see the tax exemption for estates up to $5 million expire. There are so many constituencies fighting for so many breaks that the only hope we're going to have when we actually do need to reduce the deficit - which isn't yet, but will be soon - is to start from square one on the tax code.

I have to confess, I'm not really over Health Care Reform either.

Ezra Klein: The Republicans aren't going to enjoy cutting spending as much as they enjoy saying Democrats spend too much

What Harry Reid is saying makes sense to me, but Ezra's got a point when he says that Democrats haven't exactly reacted well when these kinds of hostages are taken:

What's important to understand about the debt-ceiling vote -- where Democrats and Republicans will either strike a deal to increase the Treasury's borrowing cap or the country will collapse into default -- is that it's not like Democrats have simply forgotten about it. It's not that they haven't realized that they could tie it to the tax cuts, which Republicans want and which will add $900 billion to the debt. It's that they simply don't want to. “Let the Republicans have some buy-in on the debt. They’re going to have a majority in the House,” said Harry Reid. “I don’t think it should be when we have a heavily Democratic Senate, heavily Democratic House and a Democratic president.”

The theory goes something like this: Republicans will demand sharp spending cuts in return for lifting the debt ceiling. Let them. "Boehner et al have had the luxury of proposing all sorts of ideas that bear no relation to reality," says Jim Manley, Reid's spokesman. "Next year, they’ll have to lay it all out. No more magic asterisks, no more 'we’ll get back to you.’ "

In this telling, the debt ceiling vote represents a trap for Republicans more than an opportunity for Democrats. If Republicans want to cut spending, now's their chance. But that means passing a package of spending cuts, which they may find less enjoyable than simply saying that Democrats should stop spending so much. And if the American people aren't supportive of the Republicans’ spending cuts, the GOP will be caught defending an unpopular package as part of a political gambit that could lead to the bankruptcy of the United State of America.

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David Corn doesn't like the Tax Cut Deal either...but even he admits Obama had to do it.

First caught (at least by my eyes) by Jonathan Cohn at the New Republic. What are the odds that we don't see David Corn on Keith for a while?

In meeting after meeting, during which the president and his aides discussed his options, Obama repeatedly asked if anyone could guarantee that were he to put up his dukes, go to the mat, and play chicken with the GOPers, mid- and low-income Americans would end up with the breaks and benefits he believed they need. If he went nose-to-nose, mano-a-mano, and the R's didn't blink, they'd be nothing for nobody -- and the Bush tax cuts would end for the middle class, mean that come Jan. 1, hard-working Americans would see a smaller paycheck. To make matters worse, this might have an anti-stimulative effect on the economy.

Then what would happen? He might be able to win the blame-game against the Scrooge-ish Republicans -- which would be a significant victory, especially heading into the next Congress. But there would be no action until next year, and any tax-related bill would have to originate in the Republican-controlled House and pass a Senate with a larger and more tea party-ish GOP caucus. It could take weeks or months to hammer out a package. What were the odds it would contain as much assistance for the non-rich? In the meantime, working-class Americans would be contending with less money. That is, hurting more.

So at this late stage of the game, in the dwindling moments of the 111th Congress, should Obama have been willing to put those Americans on the line in order to do battle with the nefarious Republicans? Had he done so and won (forcing the GOPers to forgo the the tax bennies for the rich and to accept tax cuts and benefits, including unemployment insurance, for others), he would have saved the nation a lot of money and not established some dangerous precedents (such as the more generous exemptions for the estate tax). He would have served several valuable principles: We don't pay off the rich to help struggling Americans; we don't negotiate with hostage-takers. It would have been glorious. But had he failed, he might not have been able subsequently to work out a deal with the benefits of this one. As the nation has learned, the Republicans cannot be shamed into supporting measures that help besieged Americans -- but they can be bought off. ...

It's not hard to see why the guy who had to make this difficult call opted not to go nuclear. Obama was engaged in asymmetrical warfare, He apparently worried about what would happen to the unemployed and put-upon Americans without a deal. The Republicans didn't. This put Obama at a disadvantage. I don't counsel anyone not to criticize the package (and how Obama steered himself and his party into this corner). But I can almost feel his pain.

Steve Benen: "For those inclined to blame President Obama for Senate Republicans defeating repeal today, spare me."

Ouch.

For those inclined to blame President Obama for Senate Republicans defeating repeal today, spare me. The White House clearly pushed for repeal, and did everything possible to use the Pentagon's report last week to apply the necessary pressure to deliver. By most counts, there really are 60 votes to make repeal a reality, and that's the case because President Obama has helped take the lead on the issue. If you're looking to blame someone, I'd start with 40 senators who filibustered today.

Your Senate still sucks...

From the Citizen Cohn blog, a piece by Bradford Plumer:

What was particularly appalling about this vote was that the bill failed because of petty procedural objections on the part of individual senators—and not for any substantive reasons.

First, there was the tug-of-war between Majority Leader Harry Reid and Maine Republican Susan Collins. By all accounts, Collins was sincere about wanting to scrap the policy. She just wanted four days of debate on the defense spending bill (which included DADT appeal). According to Greg Sargent, after hours of haggling, Reid concluded that this was unworkable—four days of debate would be acceptable if that was all, but Republicans like Jim DeMint and Tom Coburn would've been able to drag things out for far longer with constant cloture votes and other procedural gimmicks. And there's just not a whole lot of time left in the Senate's lame-duck session. So Reid pushed for a vote this afternoon. And while Collins ended up voting for repeal anyway, the whole fracas over floor time gave other wavering Republicans an excuse to vote no.

Two Republicans in particular, Scott Brown of Massachusetts and Lisa Murkowski of Alaska, had earlier said they were committed to DADT repeal. But both ended up voting against it, claiming they wanted to see the tax-cut bill resolved first and more time to debate. Principled! Meanwhile, West Virginia's newest Democrat, Joe Manchin, also voted no, but here's what his aide told Huffington Post's Sam Stein: "I would say that if he was somehow the 60th vote, I do not think he would have voted the way he did." In other words, there actually were 60 senators who wanted to end discrimination against gays in the military, it just didn't work out that way.

Jonathan Bernstein's three sentences that I suggest everyone (who's mad about the Tax Cut Deal) read:

Read and try to understand.

And thus, I give you Jonathan Bernstein:

The problem is that Obama either had to abandon the core commitment to end the Bush-era tax cuts for the rich, or the core commitment to continue Bush-era tax rates for everyone else. He didn't have the votes to keep both core commitments. End of story.

Jeff Parker: "Do As I Say, Not As I Do..."

Thanks Cagle Cartoons!

The look on the Donkey's face in the third panel slays me.

Let there be a deal, even though it sucketh! So sayeth the Goolsebee!! (VIDEO)

The Goolsebee has spoken...



The one thing I'll say is, that the block of what even he calls "Obama Tax Cuts", specifically the middle class tax cuts will be on the long-term debt only because there ain't no way in hell, Obama is going to turn that spigot of money off while he's President.

And you will note that Goolsebee said the President's against the Tax Cuts for the high income earners...but he didn't say he'd veto them.

Lawrence O'Donnell might need a toothpick after tearing into Former Rep. Alan Grayson like he did (VIDEO)

Damn.

All three Tax Policy experts politely (or not so politely) let it be known that Alan Grayson had no idea what he was talking about.

He was a waste of Congress' time.  I won't miss him.

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For the record again, Arianna Huffington in her one shot a running for Political Office (California Governor), she got .55% of the vote. Who is she to be giving political advice to anyone???

And now Part 2:

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And a little James Clyburn, who did not get his ass kicked by Lawrence:

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Tom Toles reveals your secret Liberal Fantasy (GRAPHIC)

Deep down, this is what you really want, right?

Plum Line: Does this count as Triangulation??

Greg Sargent's answer is...no:

Whatever you think of Obama's broadside yesterday, it seems clear that it has nothing to do with "triangulation," at least as it was practiced by Bill Clinton. Obama's dispute with the left isn't an effort to position himself ideologically as a centrist. It's part of a broader effort to present himself as Washington's lone resident adult in a room full of bickering children on both sides -- the last line of defense for the American people against Washington business-as-usual.

The problem here is that people tend to view Obama's stated aspiration to always seek common ground between warring parties through the prism of ideology. But that aspiration has always been more about temperament and process than about occupying the ideological "center." During the 2008 campaign and since then, he has insisted he would unite opponents by finding points of agreement between them and working outward from there. This isn't really about ideological "centrism" in any meaningful sense. It's a case about process. It might better be described as "Beer Summit-ism."

The reason Obama's attacks on the left smack of triangulation is that he persists on painting the left and the right with the same brush: He presents himself as the last reasonable man trapped between two sides blinded to reason by ideology. Hence his insistence yesterday that he won't be held to any unreasonable "ideal." But as irksom as this is, it isn't really the same as positioning oneself ideologically by arguing that the left is wrong on policy substance, as Bill Clinton did.

The man behaves as he says he will behave...yet there is shock.

And what do the Polls say about the Tax Cut Deal?

This from Greg Sargent:

Does the public support Obama's tax cut deal? White House officials have been predicting that the public would support the deal once they realized what Obama is getting in return for temporarily extending the high end cuts, and the new Gallup Poll suggests they might have a point.

It finds broad public support for two major elements of the compromise, with 66 percent favoring both the temporary extensions of the tax cuts and unemployment benefits. One other key point: This compromise was reportedly all about winning back independents, and they strongly support both provisions.

Bloomberg says otherwise.

I might be switching from "Countdown" to "The Last Word" after last night (VIDEO)

I didn't bother watching Keith Olbermann last night. Why??  I don't do "You're Not Doing It Right" Television.  Keith will have his Domestic experts on and then not listen to them.

Lawrence O'Donnell had four Progressives on, and with the exception of Erza Klein, metaphorically speaking, beat the holy snot out of them.

Granted, these are the weak-sisters of a Professional Left, but they still can't answer the central question: if not this deal, then what?

You gotta love a ideological cockroach like Roger Hodge saying that he appreciates Lawrence's expertise in this matter (he was Chief of Staff to the Senate Finance Committee), and then saying he doesn't know what he's talking about.  And calling the President Barack Hoover Obama?  Really?  Gutless punk.

I do believe Lawrence actually called actual bull@#$% on Roger Hodge and Jane Hamsher:

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Second segment:

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President Obama addresses supporters directly on the issue of the Tax Cuts deal (VIDEO)

Via the Democrats.org.

Hmm.

I like this. I think he needs to do more of this (along with more White House White Boards):

President Obama's complete Press Conference (VIDEO)

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Andrew Sullivan: Illinois state senator, Ricky Hendon kicks the crap out of professional politicians.

Wow. Absolute, fantastic, must-see catch from Andrew Sullivan.

Illinois state senator, Ricky Hendon kicks the crap out of professional politicians. He's really talking about Civil Unions in the clip (he's, like me, a charter member of the "I don't care" Democratic Caucus...as in I don't care if Adam and Steve get married)...

...but...(hee-hee) it applys to so many other things, especially today.

Loved it.

TPM: Obama Dresses Down 'Sanctimonious' And 'Purist' Progressives (VIDEO)

Transcript (first posted at TPM), and analysis (also at TPM):

With respect to the bottom line, in terms of what my core principles are, yeah look, I've got a bunch of lines in the sand. Not making tax cuts for the wealthy permanent, that was a line in the sand. Making sure that the things that most impact middle-class families and low income families, that those were preserved, that is a line in the sand. I would not have agreed to a deal, which, by the way some in Congress were talking about, of just a two-year extension on the Bush tax cuts and one year of unemployment insurance, but meanwhile all the other provisions of earned income tax credit or other important breaks for middle class families, like the college tax credit, that those had gone away, just because they had Obama's name attached to them instead of Bush's name attached to them.

So this notion that somehow we are willing to compromise too much reminds me of the debate that we had during health care. This is the public option debate all over again. So I pass a signature piece of legislation where we finally get health care for all Americans, something that Democrats had been fighting for, for a hundred years - but because there was a provision in there that they didn't get, that would have affected maybe a couple million people, even though we got health insurance for 30 million people, and the potential for lower premiums for a hundred million people, that somehow that was a sign of weakness and compromise.

Now, if that's the standard by which we are measuring success or core principles, then let's face it, we will never get anything done. People will have the satisfaction of having a purist position, and no victories for the American people. And we will be able to feel good about ourselves, and sanctimonious about how pure our intentions are and how tough we are. And in the meantime the American people are still seeing themselves not able to get health insurance because of a pre-existing condition, or not being able to pay their bills because their unemployment insurance ran out. That can't be the measure of how we think about our public service. That can't be the measure of what it means to be a Democrat.

This is a big, diverse country. Not everybody agrees with us. I know that shocks people. You know, the New York Times editorial page does not permeate across all of America - neither does the Wall Street Journal editorial page. Most Americans, they're just trying to figure out how to go about their lives, and how can we make sure that our elected officials are looking out for us? And that means because it's a big, diverse country, and people have a lot of complicated positions, it means that in order to get stuff done we're gonna compromise.

This is why FDR, when he started Social Security, it only affected widows and orphans. You did not qualify. And yet now it is something that really helps a lot of people. When Medicare started it was a small program, it grew. Under the criteria that you just set out, each of those were betrayals of some abstract ideal.

This country was founded on compromise. I couldn't go through the front door of this country's founding. And you know if we were really thinking about ideal positions, we wouldn't have a Union.

And so, my job is to make sure that we have a North Star out there - what is helping the American people live out of their lives? You know what is giving them more opportunity, what is growing the economy, what is making us more competitive. And at any given juncture there're gonna be times where my preferred option, what I'm absolutely positive is right, I can't get done. And so then my question is, does it make sense for me to tack a little bit this way, or tack a little bit that way, because I'm keeping my eye on the long term, and the long fight, not my day to day news cycle, but where am I going over the long term?

And I don't think there's a single Democrat out there, who if they looked at where we started when I came into office and look at where we are now, would say that somehow we have not moved in the direction that I promised. Take a tally, look at what I promised during the campaign. There's not a single thing that I said that I would do that I have not either done or tried to do. And if I have not gotten it done yet, I'm still trying to do it.

And so, to my Democratic friends, what I'd suggest is, let's make sure that we understand this is a long game, this is not a short game.

And to my Republican friends, I would suggest, I think this is a good agreement, because I know they're swallowing some things that they don't like as well, and I'm looking forward to seeing them on the field of competition over the next two years.

UPDATE 2:05pm Pacific:

Added commentary from Jonathan Bernstein:

The truth is that there are a lot of people who just don't accept that the President of the United States can want something, fight for it, fight effectively and correctly, and still not get it. If it doesn't happen, it must have been—in Obama's words—a "betrayal." Those people are wrong.

He added some more negative points. Those are here as well.


Greg Sargent:

Obama was as visibly frustrated and angry as he's perhaps ever been in public, and some folks are pointing out on Twitter that he seems more angry with the left than he is with Republicans. In fairness to Obama, though, he directed harsher rhetoric at Republicans, implicitly comparing them to hostage takers at one point, and his basic message was that he needs fellow Dems to understand the nature of the opposition and allow him the space to act accordingly.

That was by far Obama's sternest publicly rebuke yet of his liberal critics, and his frustration with them -- which seems to have built up over the past two years -- was palpable. If Obama is going to play the role of adult-in-chief going forward, his tormentors on the left clearly will not be spared the rod.

Ezra Klein (explaining my Father's position):

My conversations with various progressives over the past 24 hours have convinced me that the problem is less the specifics of the deal -- though liberals legitimately dislike the tax cuts for the rich, and rightly point out that Obama swore to let them expire -- than the way in which it was reached. Put simply, Obama and the Democrats didn't fight for them. There were no veto threats or serious effort to take the case to the public.

Instead, the White House disappeared into a closed room with the Republicans and cut a deal that they'd made no effort to sell to progressives. When the deal was cut, the president took an oblique shot at their preferences, saying "the American people didn’t send us here to wage symbolic battles or win symbolic victories." And this came a mere week or two after the White House announced a federal pay freeze. The pattern, for progressives, seems clear: The White House uses them during elections, but doesn't listen to, or consult them, while governing. In fact, it insults them, and then tells them to quiet down, they got the best bargain possible, even if it wasn't the one they'd asked for, or been promised.

If you're worried about stimulus, joblessness and the working poor, this is probably a better deal than you thought you were going to get. "It’s a bigger deal than anyone expected," says Bob Greenstein, president of the Center on Budget and Policy Priorities. "Both sides gave more expected and both sides got more than expected." The White House walked out of the negotiations with more stimulus than anyone had seen coming. But they did it in a way that made their staunchest allies feel left behind, and in many cases, utterly betrayed.

That the Obama administration has turned out to be fairly good at the inside Washington game of negotiations and legislative compromise and quite bad at communicating to the public and keeping their base excited is not what most would have predicted during the 2008 campaign. But it's true.

Chris Cillizza:

Obama, to be fair, didn't only single out Democrats for criticism. He compared negotiating with Republicans to negotiating with hostage takers and said he only did so because of the danger that the hostage -- aka the American public -- would be harmed.

Taken broadly, this press conference was a true rarity for Obama: the president as populist -- and an angry one at that.

The president repeatedly sought to frame the compromise on tax cuts as a choice between playing politics and looking out for the American people. "My number one priority is to do what's right for the American people," Obama said at the start of the press conference.

The image of a visibly irritated -- if not outright angry -- Obama was a stunning contrast to cool, calm and collected persona that he has long cultivated.

Allies of the president insisted his tone was justified and winning -- that he was channeling the frustration of the American people with a government unable to solve big problems.

But, anger is a dangerous emotion in politics.

Used tactically, it can help convey a sense of shared concern/upset with the American people. Used less skillfully, it can make a politician look small and petty.

The best -- and the worst -- of the anger equation can be found in former president Bill Clinton.

At his best, Clinton used his anger to channel the best of the best southern populist politicians -- turning an issue into an "us versus them" argument that he almost always won.

At his worst, Clinton would turn his fire onto the process itself -- the media, the rules of Congress etc. -- which almost invariably ensured political defeat either of the temporary or permanent variety.

UPDATE: 3:16pm Pacific: I put up the MSNBC Video of the brushback, since it has a little more meat on its bones.

Also, given the fact that the President ended the presser with this statement I think pretty much proves it was planned from the beginning.


UPDATE: 4:31pm Pacific. Okay, I botched that. Turns out the clip was the complete Press Conference. It deserves its own Post, so I gave it one. Now, this OFA bit has more meat on it than the TPM video, but I don't think its the complete answer. Still looking for that.

Think Progress: How many people will benefit under Obama's parts of the Tax Plan versus the GOP? (GRAPHIC)

From Think Progress:

The Center for American Progress says the Tax Cut Deal could create 2.2 Million Jobs??

Saw this on Erza first, the Center for American Progress has given the President (and wayward Liberals) some cover, but the actual report is interesting:

Our analysis of the framework tax agreement that President Barack Obama announced yesterday, including additional tax cuts and an extension of unemployment insurance, finds that 2.2 million jobs will be the end result. In this time of economic distress, millions of new jobs are, of course, very welcome. It is, however, unfortunate that these jobs have to come from an agreement that is a balance between large, unneeded, bonus tax breaks for the wealthiest Americans and the needed continuation of unemployment benefits, middle-class tax relief, and additional help for the economy for the rest of us.

While the terms of the deal are understandable given the effective veto power of conservatives, it is unfortunate that policies aimed at the vast majority of Americans and at boosting the economy were held hostage to wasteful tax cuts for the wealthiest 2 percent. But the Obama administration clearly had its eye on job creation in its willingness to accept $133 billion in misallocated bonus tax breaks for the rich in exchange for policies to sustain the economic recovery and help the middle class.

We estimate that the deal as described would save or create 2.2 million jobs, excluding jobs associated with the extension of the broader-based portions of the Bush tax cuts on which all parties were agreed. To give an example of how the $133 billion used for the bonus tax cuts, including estate tax cuts, could have been better used: If it had been instead put to additional payroll tax cuts, 2.7 million jobs would be saved or created. Or alternatively, of course, the deficit could have been $133 billion less.

@chucktodd: Nancy doesn't have the votes for the Tax Cut Deal.

This is also good, in my opinion. Chuck just tweeted this:

Decipher Pelosi statement on WH-tax deal http://bit.ly/hd8y5r //not an endorsement; not a rejection; Translation:she doesn't have the votes

(MJ's note: The above link isn't highlighted, because it doesn't work).

Still, this is what Nancy was made Minority Leader to do, hold the caucus together, and get us a better deal. If we can wring something else out of those bloodsuckers, I'm all for it.

One of the things that I do like about this deal, is its existence. What happened yesterday is what Barack Obama saw for his Administration early on. The problem was he ran into blockheaded GOP opposition that found itself rewarded for its blockheaded opposition with power.

Only thing is now the blockheaded GOP, since they're in power, have to deliver, and the only way to deliver is to get stuff passed, and the only way to do that is to deal with Barack Obama.

So expect more of these kinds of odious compromises. Getting core some Liberal priorities done in exchange for the GOP advancing some of its agenda.

And to my fellow Liberals, I have to ask: What's more important, getting what we want done? Or denying the GOP what they want? I have the ugly sick feeling, that if those were the only two choices...

Erza Klein on the reality of Governing. You play the hand you're dealt.

If there's one area about Countdown with Keith Olbermann that even I, the affirmed Liberal, can't stand is his propensity for "You're Not Doing It Right" Television.  It's always easier yelling from the cheap seats than actually having to, you know...coach the Team.  Likewise, governing is always easy in theory.  When you get down to the brass tacks of it, when it's your ass on the line (and in the President's case, a lot more than that) it gets a lot harder.

Erza Klein opened a piece today with all the various scenarios that coulda/woulda/shoulda happened over the Tax Cut Deal.  It's hard to imagine the President not getting a similar menu of options. Which would you have chosen? I know I was probably with Krugman more than anything, but I'm at least willing to admit that there were possibly heavy costs to that chosen path. Wonder if he'd be willing to acknowledge them?  I wonder if Keith will have even one guest on that will challenge his already held belief that this was a bad deal (like say...Erza?)

No deal: Paul Krugman made the case for this yesterday. In a "no deal" scenario, Republican demands to extend the tax cuts for high-income earners are met with simple refusals from the Democrats. The two sides can't agree, and the tax cuts expire. This sparks a bitter showdown, with the Republicans blaming Democrats, and vice-versa. It also hurts the economy, as markets both adjust to the idea that taxes might increase and that the two political parties prefer outcomes that neither side likes -- and that the public opposes -- to compromise.

Partial deal: Two months ago, President Obama could've simply issued a veto threat against extending the tax cuts for income over $250,000. Multiple high-profile Republicans had admitted that there was little they could do in that scenario. The tax cuts for the rich would have expired. The rest of the tax cuts would have been extended permanently -- at a much higher total cost to the deficit. But an angry Republican Party wouldn't have cooperated on unemployment benefits, the tax extenders or the payroll tax cut.

Bad deal: Democrats simply get rolled in the negotiations. There's a two- or three-year extension of all the tax cuts, and a short extension of unemployment benefits. That's about it.

Better deal: Democrats get more out of the negotiations. There's a two-year payroll tax cut, and a vote to lift the debt ceiling (which will have to happen in February, anyway). There's also a direct spending component of some kind, probably on infrastructure.

I find ranking these quite difficult. The Partial Deal was the White House's preference, but I think extending the bulk of the tax cuts in perpetuity is bad policy. On the other hand, it's likely to happen anyway. No Deal might take care of that problem, but it's potentially damaging to an economy that remains weak and a market that remains skittish. Better Deal looks good in some ways, but all this money will eventually have to be paid back, so the more you spend, the more deficit reduction you'll have to do later -- and there's no guarantee that the mix of policies we use for deficit reduction will be good.

The reality is that it's hard to judge this deal without knowing the deals that will come after it...

I think we wound up a hair's breadth short of Better Deal. (I don't recall Infrastructure spending being part of this deal, so...)

Wide and varied reactions from...well, you know...various Liberal Pundits and Reporters

Katrina Vanden Heuvel (along with a few of my least favorite Liberals) already has mouthed off in the pages of the Washington Post. You can find her stuff there. Joan Walsh and Roy Seikoff were on with Ed Schultz. (There's a reason I don't listen to his show anymore). I'm waiting for Randi Rhodes and Josh Marshal, who even if they disagree with have a sense of perspective about the deal.

Again, consider the facts and our whipsmart media. We went from the President getting exactly nothing for the Tax Cuts, to the President getting just Unemployment Benefits extended for the Tax Cuts, to the President getting Unemployment Benefits extended plus additional Stimulus (or Stimulus preservation) that will never happen under a Republican Congress.

All he's got to do now is hope it works.

Until then, here's the rest.

Ezra Klein (from yesterday morning, before it all went down):

In other words, rather than paring the tax cuts and the deficit back, they're making both larger. If you're of the mind that the economy needs all the extra help it can get right now -- and you should be -- this is a lot more extra help than anyone expected Republicans and Democrats would agree to give it. And from a political perspective, if you believe that what matters for elections is the economy -- and you should -- then it's worth it for the White House to lose news cycles in 2010 if it means adding jobs by 2012.

That's the policy of the deal. The politics are similarly focused on the next election: Democrats are negotiating toward a two-year extension of the tax cuts. They've rejected a three-year extension. That means the next fight over the tax cuts will be part of the 2012 election. And the White House believes that an improved economy and a bigger deficit will make it much harder for Republicans to support extending tax cuts for the rich. If they try, that gives Democrats both a populist cudgel and a way to take hold of the deficit issue.

The White House's problem is that they handled the politics of this argument so poorly in 2010 that their allies on the Hill don't trust them to do better in 2012. One Senate staffer summed up his reaction to the deal in one word: "Nausea." Another said the deal is fine -- but it was getting hard to trust the White House. "Will they actually have that fight in 2012?" He asked. "They dropped the ball this time around."

Uhh, they weren't the only ones to drop the ball there, Congressional Democrats.


Jonathan Bernstein:

This goes back to Ezra Klein's comment about health care, in which he realized that Republicans could have had achieved practically any substantive policy concerns in exchange for a few votes. The same was true on the other major Democratic priorities.

Understanding the tax cut debate just requires seeing that this is another of the Democrats' big agenda items -- only this time, Republicans are playing for the substance, not the issue. And with both sides having substantive goals that they really care about, and neither having the votes to get there on their own, a deal makes lots of sense. Indeed, seen from this perspective, the eventual deal isn't bad at all for the Democrats; they'll be getting the middle class cuts plus whatever other stimulus and safety net they can bargain for, while the GOP gets, well, the only thing they seem to care about in domestic policy.

Jonathan Chait:

It appears that President Obama got more out of Republicans, in return for extending all the Bush tax cuts, than I expected he would. Of course he also gave up more, agreeing to an extension of a low estate tax rate, which is apparently crucial as an incentive for rich people to, uh, die.

Why were Republicans so flexible? They are willing to deal away a lot if they're getting tax cuts for the rich. President Clinton got Republicans to establish a Childrens' Health Insurance Program in 1997 in return for a capital gains tax cut. Now Obama got a fair amount of stimulus in return for upper-bracket tax cuts. Unfortunately, it tends to be terrible policy. But it's the party's core policy goal, and if you help them attain it they can be surprisingly reasonable.

Jonathan Cohn:

So is this a good deal? Uh, not exactly. Is it a better deal than expected? That depends on what you were expecting and when you expected it.

Here, quickly, are five reasons to like this deal:

1. By adding an extension of unemployment insurance (and a payroll tax holiday to extension of the Bush tax cuts, the deal amounts to a new stimulus—one larger than the Republicans would have supported otherwise. One senior administration official suggested in a briefing call that, given Republican demands, “most people thought it would be impossible” to get such an extension.

2. Purely on policy grounds, permanent extension of any tax cuts is a bad idea. The country can’t afford them. No, you don’t want to raise taxes when the economy is so weak. But you don’t want to deprive the government of revenue permanently when the long-term budget picture is so bleak.

3. Obama gets a chance to look serious and less obstructionist than the Republicans. Americans say they like that.

4. Obama gets to give people a tax break. Americans say they like that too.

5. Obama couldn’t win this fight now, given the lack of will among more conservative Democrats in Congress and his low political standing. This way, he lives to fight another day--hopefully, with a stronger economy and stronger polls to buoy him. Ezra Klein laid out the political calculus this morning. Obama seemed to suggest he was thinking along the same lines when, during his press conference, he vowed to make his case to the American people in 2012. Maybe the Great Explainer will prevail after all.

And here are five reasons to hate this deal:

1. Tax cuts that benefit only very wealthy people are a horrible way to stimulate the economy. They also do a lousy job of addressing human needs at a time of considerable suffering. Obama used to decry these cuts. In fact, once upon a time most people would have thought it impossible that Obama would support such an extension.

2. Yes, permanently extending the tax cuts are a bad idea. But it’s not as if temporarily extending them makes permanent extension less likely. As Paul Krugman wrote today, "if tax-cut blackmail works now, why shouldn’t it work again later?" This was arguably Obama's best and last chance to kill a tax cut that will, over the next decade, starve government of money necessary to run its most important programs.

3. Americans already think Obama is more serious and less obstructionist. Based on the election results, they don't seem to care.

4. Americans already got a tax cut from Obama. Based on the election results, they don't seem to have noticed..

5. Even with the extra stimulus, the economy will likely grow slowly. That means Obama could still be low on political capital in two years. Also, to win a fight like this Obama would have to show the sort of communications skills he hasn’t shown in the last few months. He has utterly failed to frame this issue in a way that helps the Democrats' cause.

How you look at it depends on what you were expecting and when you expected it? Who said that before??

Ezra Klein (since I didn't put it in the terms of the deal post yesterday afternoon):

Most of the money just keeps programs that are currently in effect from expiring, so in some ways, it would be more accurate to say that this money is anti-contractionary rather than stimulative. It's important that the White House doesn't repeat the mistake it made in the original stimulus and overpromise how much this will do for the economy. What you can say about this policy is that, for the moment, it doesn't make things much worse, and it probably makes them a bit better. This is not the government making a major new commitment to the recovery. It's the government not getting in the way, and maybe doing a bit to help, the horribly slow recovery that's happening anyway.

It also, importantly, holds the extensions to two years. The tax cuts for income over $250,000 and the new estate tax rates will expire in 2012. The White House thinks that this'll be a good election issue for them, as it combines a popular, populist stance on taxes with a deficit-reduction message. Whether they're right -- and whether they'll fight in 2012 in the way people hoped they'd fight in 2010 -- remains to be seen. But on a policy level, two-year extensions of bad tax cuts are much preferable to 10-year extensions of bad tax cuts.

And finally, it's something of a hopeful sign: The White House sat in a room with Republicans and Democrats and managed to negotiate an actual compromise. The final deal includes some things that Democrats will like and some things they won't like, and it includes some things Republicans will like and some things they won't like. But it's a deal, and a better one than many -- myself included -- thought they'd reach. These tax cuts were a bit of a special legislative case, as their scheduled expiration forced action, but if you want to be optimistic, this process suggests that the next two years might be a bit more productive than some of us have been predicting.

Media Matter's @EricBoehlert is the winner of Fort McHenry's first Tweet of the day contest!

For which he wins...exactly nothing. Because I didn't know we were having one until I read his tweet.  (Hey, I'm runnin' this blog on a shoestring as it is).

Still, this blog officially recognizes his funny, and at the same time 100% journalistically truthful tweet:

Halperin: Obama has lost support of voter groups that formed his 2008 coalition. Polls: No he hasn't; http://bit.ly/ebv5qt

BOOM! Media Matters has the complete vivisection here.

The Political Carnival: President Obama's announcement of the deal (VIDEO)

First caught by my TwitterFriend @GottaLaff's wonderful website, the Political Carinval:

Visit msnbc.com for breaking news, world news, and news about the economy

Ezra has the terms of the deal...

Reprinting the meat of it from: "An imperfect, but not-that-bad, deal on the tax cuts", we have:

1) The Bush tax cuts get extended for two years -- with one ugly surprise: For the next two years, estates up to $5,000,000 will be protected from the estate tax, and the tax rate for the few estates that are taxed will be 35 percent. That's worse than the 2009 estate tax ($3.5 million exemption, 45 percent rate), though better than this year's "no estate tax at all." The difference in expected revenue between the 2009 levels and the compromise levels is $10 billion or so.

2) The refundable tax credits are extended: The Earned Income Tax Credit, the Child Tax Credit and the American Opportunity Tax Credit were all pumped up in the stimulus, but set to expire this year. All of them will be extended. Price tag? $40 billion or so.

3) Unemployment insurance gets extended for 13 months: Most observers -- myself included -- thought the federal boost to unemployment insurance (which allowed jobless workers in states with high levels of unemployment to collect insurance for up to 99 weeks) would lapse. At best, there'd be another two- or three-month extension. In perhaps the most important part of the deal, there's going to be a 13-month extension at a cost of $56 billion.

4) A 2 percent cut in the payroll taxes paid by employees: This is perhaps the most unexpected part of the compromise. Rather than extending the administration's Making Work Pay tax credit for two years, which would've been worth about $60 billion a year, they've agreed to a one-year cut in the payroll taxes paid by employees, which'll raise $120 billion in 2011. That's a much stronger boost over the next year, and of course these tax cuts have a tendency to get extended ...

5) Business expensing: Remember back in September, when the White House announced a proposal to give businesses two years in which they could deduct 100 percent of the cost of new investments? That's in the deal, too. The cost of this is a bit complicated -- it's $30 billion over 10 years, but it works by offering huge tax cuts in the next two years and then paying that back over the next eight. So we're basically trying to shift business investment forward to 2011 and 2012. Over those two years, the tax breaks should be around $200 billion, though because it's a shift rather than a cut, it will have less than $200 billion in impact.

Ezra's reaction is there as well. I think it's a "Meh. Coulda been worse."

Andrew Sullivan's take on the President's Strategy on the Bush Tax Cuts... (Intellectual Dishonesty Edition)

Andrew doubles down by posting this from Dave Weigel:

[Liberals] were promised by Obama -- by every Democratic candidate, really -- that the tax rates would be restored to pay for social programs. They thought they proved in the 1990s that these were fair tax rates under which the economy could grow wildly, and that Bush proved in the 2000s that lower marginal tax rates for the wealthy didn't spur real economic growth. It was an important debate, and they won it. They have polls telling them they won it, and most Americans are find with restoring the top rates. And here's Obama, about to throw the game, affirming the conservative line that tax cuts of any size at any time are good for the economy.

But he isn't. He's saying that he'd prefer to raise taxes on those earning more than $250,000 a year, but cannot in this political climate at this particular time. Nothing prevents Obama from sunsetting them in their entirety if he wins re-election on a sturdier economy. And nothing prevents him from campaigning on long-term debt reduction from now on, as a way to restore the confidence that can keep the recovery moving.

It's obvious that President Obama's strategy only matters to Andrew Sullivan so long as it hews to his conservative ideology. Liberals simply don't factor into his thinking, and that's intellectually dishonest.  (Andrew may disagree with us, but we are out there, we do exist, and the President kinda needs us to show up in 2012).

Here's a question for Andrew that Andrew can't answer: If after running on the idea that the elimination of the Bush Tax Cuts was a good thing in 2008 and 2010, and Bush Tax Cuts continue to exist with President Obama's signature on them, how likely are Liberals to trust the President on their repeal in 2012 as a campaign issue?

Andrew Sullivan's take on the President's Strategy on the Bush Tax Cuts...

From The Grand Compromise:

So let's get this straight: at a moment when most acknowledge a fiscal crisis that requires sacrifice on both sides, such sacrifice means the GOP gets its budget-busting non-sunsetting of Bush's tax cuts, and the Dems get to extend unemployment insurance. The former is far more damaging than the latter to fiscal sanity, but both add to spending after an election in which the public allegedly stood up as one to demand fiscal restraint.

Here's why it makes sense for Obama. It certainly helps goose the economy for the next two years, which has got to help him win re-election; if done quickly, it can create room for the new START and repeal of DADT in this Congress; in the next Congress, Obama can focus on long-term debt reduction in the State of the Union, without being mau-maued on tax hikes.

I don't see this as surrender. I see this as Obama's cold-blooded pragmatism. Why is this still news?

All I'll say is that along the terms Andrew Sullivan names, the strategy will probably work. The problem are the terms Andrew doesn't name.

The simple fact of the matter is that a great number of the President's Liberal base (myself included) doesn't like this compromise, even with the caveat that it comes with an extension of Unemployement benefits (which I do like, but I think we should've held 'em up for more).

On top of that, as dear ol' Doctor Dad says, the Tax Cuts are not paid for (i.e., they are not offset with spending cuts) and the Unemployment Extension will be.

But, like with everything else in the Media's view of Obamaworld, that's not necessarily the case. And until its put in stone, speculation isn't warranted. Remember, 48 hours ago, major figures in the media were saying that the Democrats were going to cave on the Tax Cuts issue, getting exactly squadoosh in return.

But to me, this is another case of the President getting blamed a little too much for the ills of our fellow (cough-cough) Democrats. The middle class is important to a huge majority of our caucus...but not 100%, Kent Conrad, Ben Nelson, Joe Lieberman, Blance Lincoln, Mark Pryor are among the few that seem willing to screw the deficit over (along with the whole GOP caucus) in order to get a few tax cuts for millionaires.