President Obama Eviscerates Republican No-tax Religion, and A Lesson for Progressives

On Thursday night, lots of people were running around screaming, "The sky is falling, the sky is falling" over rumor-mill reports that President Obama was willing to give Republicans as much as $3 trillion in spending cuts, devastating our social safety net, without securing any guaranteed tax revenue increase. Well, whaddya know, despite tons of hair catching on fire, the rumor mills were lying to you. Shocked, I'm shocked I tell you that there's rumors flying around in our national media!

But it turns out that the President held his ground as strongly as ever that significant revenue increases would be required to get any meaningful deal done on deficit reduction. So John Boehner turned tail and ran. He called the President and walked away from the negotiations. The President took no prisoners in his press conference and laid bare the real Republican agenda to the American people in his press conference: protect the tax code welfare to the ultra wealthy rather than solve the nation's huge debt problem.



A pretty good summary, question by question, is available on the White House website. President Obama got into some pretty close specifics of the deal that he was offering John Boehner that the Speaker walked away from, prompting the question, Can they say yes to anything?
  • $1 trillion in cuts in discretionary spending - both defense and domestic.
  • $650 billion in savings to Medicare, Medicaid and Social Security spending, shaping them in a way to preserve the fundamental bases of the systems, without affecting current beneficiaries in an adverse way.
  • $1.2 trillion in tax revenue increases without increasing tax rates but through eliminating loopholes, cutting back on deductions and reforming the tax code.
One might point out here that this is a 3:4 revenue to cuts ratio, not a 1:4 or 1:8 cuts ratio as everyone assumed in Thursday night's freakout-a-palooza. President Obama elaborated why the tax revenue measures were sorely needed (note the progressive frame on government personified):
Now, if you do not have any revenues, as the most recent Republican plan that’s been put forward both in the House and the Senate proposed, if you have no revenues at all, what that means is more of a burden on seniors, more drastic cuts to education, more drastic cuts to research, a bigger burden on services that are going to middle-class families all across the country. And it essentially asks nothing of corporate jet owners, it asks nothing of oil and gas companies, it asks nothing from folks like me who’ve done extremely well and can afford to do a little bit more.

In other words, if you don’t have revenues, the entire thing ends up being tilted on the backs of the poor and middle-class families. And the majority of Americans don’t agree on that approach.
Obama reiterated it again later as he made clear who he thinks about every single day:
The difference was that we didn’t put all the burden on the people who are least able to protect themselves, who don’t have lobbyists in this town, who don’t have lawyers working on the tax code for them -- working stiffs out there, ordinary folks who are struggling every day. And they know they’re getting a raw deal, and they’re mad at everybody about it. They’re mad at Democrats and they’re mad at Republicans, because they know somehow, no matter how hard they work, they don’t seem to be able to keep up. And what they’re looking for is somebody who’s willing to look out for them. That’s all they’re looking for.

And for us not to be keeping those folks in mind every single day when we’re up here, for us to be more worried about what some funder says, or some talk radio show host says, or what some columnist says, or what pledge we signed back when we were trying to run, or worrying about having a primary fight -- for us to be thinking in those terms instead of thinking about those folks is inexcusable.
The President also pointed out this proposal cut just as much as the bipartisan "Gang of six" proposal that some Republicans signed onto, and actually less in tax raisers. This is what Boehner turned tail and ran from. Why? Because the Republican party is not now, and never was, serious about debt reduction. That has been proven more than conclusively. First, Eric Cantor walked away from negotiations with the Vice President. Then John Boehner walked away, twice. What was the sticking point? By all accounts - including those of the principals here - the revenue side of the deal. TPMDC has the rundown:
As of Thursday morning, the two sides remained $400 billion apart. Boehner had agreed to raise $800 billion in revenue over ten years from allowing the Bush tax cuts to expire at the end of next year on the wealthy -- those making $250,000 and above -- but the President wanted an additional $400 billion more to provide more balance to offset cuts to entitlements such as Medicare and Medicaid.[...]

The two sides were incredibly close when it came to costs savings for Medicare and Medicaid, with the President agreeing to $425 billion in savings over 10 years. Republicans wanted roughly $40 billion more than Democrats would agree to as of Thursday. Some of the savings would be achieved by gradually increasing the eligibility beneficiary bracket from 65 to 67 over a period of many years.[...]

The would-be deal also included a loose agreement to prevent the future shortfall in Social Security, but the two sides differed in the approaches they wanted.
So it seems like agreement on cuts were about $1.4 trillion, while the White House offer was $1.7 trillion. Boehner wouldn't take the additional cuts (!) simply to protect corporate jets and oil tycoons from the big bad tax man. But the thing of real beauty in the press conference? John Boehner, while pointing the finger at the President, essentially ceded all the ground to President Obama. Extraordinarily, even according to his version of the story, he - and Eric Cantor - agreed to $800 billion in tax revenue increases, which was to be achieved either through the tax code overhaul, or a trigger where the Bush tax cuts for the top bracket would expire. Despite what Boehner thought he was spinning in his press conference last night, he validated an argument President Obama was already winning: that you cannot do serious deficit reduction without increasing tax revenues, period.

This is an extraordinary about-face by Boehner, who just days ago made damn nearly every one of his Rpeublican colleagues in the House vote on a radical plan that would lower and cap the already-diminished revenue, and just months after also making his members vote on the Paul Ryan Path to Poverty that would have ended Medicare in order to give an average $200,000 tax break to every millionaire. Boehner and Cantor's admission that they agreed to any tax increase at all puts a lie to their radical ideas. And despite Boehner's whining lie that the President somehow invented an additional $400 billion on Thursday evening, it was the Republicans who came up with a new eleventh hour demand that a debt deal include a repeal of the individual mandate in health reform, which has nothing whatsoever to do with the budget.

Whether one believes Speaker Boehner's version of the story or President Obama's - and in a situation where nothing is agreed to until everything is agreed to, Boehner just blinked and said he agreed $800 billion in revenue increases - it's easy to see who is winning the argument here. Even if one believes Boehner's version, it's basically: "I pulled out of talks over $400 billion in tax increases after already agreeing to double the amount." Uhh, okay, I'm sure that will go over as well as a lead balloon among the rabid anti-tax morons on the far Right.

It wasn't just John Boehner and Eric Cantor that were forced to give up on the Republicans' no-tax religion while inexplicably walking out from an extraordinarily fair deal, as the President put it, the First Deity of the no-tax religion Grover Norquist himself backed down from drowning the government in the bathtub as default loomed over.
Allowing the Bush tax cuts to expire to close the budget deficit would not constitute a tax increase or violate an anti-tax pledge signed by many Republicans, Grover Norquist told the Washington Post’s editorial page.

“Not continuing a tax cut is not technically a tax increase,” Norquist said.

Asked if it would violate his Americans for Tax Reform’s anti-tax pledge, Norquist said: “We wouldn’t hold it that way.”
Oops.

Even the US Chamber of Commerce - whose exclusive goal these days seems to be to lobby for tax cuts for rich people - warned that the Republican's refusal to compromise would have dire consequences, saying, "Jeopardizing our country’s credit rating and fiscal security by refusing to compromise isn’t the answer."

And therein lies the lesson for liberals. It seems like on Thursday evening, nearly every progressive group had a complete cow over unsubstantiated media rumors of one-sided severe cuts. From the AFL-CIO to MoveOn.org, from SEIU to Bernie Sanders could not shut up about this. Even Rep. Chris Van Hollen, the top Democrat on the House budget committee got taken in by the sucking blackhole of a big media lie, which, to his credit, he did an about-face on Lawrence O'Donnell's show last night, and credited the President for slapping down the rumors. In the mean time, the President single-handedly dismantled the Republican frame on taxes, made them admit to going sack-religious on their own tax-cut religion, and made the staunchest defenders of the super wealthy's tax welfare system back down. Simultaneously. Single-handedly. Let's learn a lesson from that.

We have got to realize that we cannot fall for every anonymously sourced big lie the media puts out there. We have got to realize that it is in the media's interest to generate controversy and conflict, and they will not - as they did not in this case - wait to verify rumors that too many "anonymous aides" are only too happy to spread in politics. And we have got to begin trusting the President to have our backs. You know why? Because he always has had our back. He has never failed in that. To go completely bonkers over unsubstantiated rumors about this President and believe media rumors that he's selling progressive values out is a shameful indictment of the progressive beltway insiders. How easily they are duped.

Especially for some of these people who have a direct line to the White House - like members of Congress and major union leadership. Shame on them for not picking up the phone and calling the White House before they rushed out statements and emails attacking the President and scaring everyone who puts their trust in these organizations and personalities to know what is going on and give them the truth rather than rumors. Shame on them. It's time to realize that this president is the best friend working Americans have had in Washington since probably FDR, and progressive groups need to start thinking about that before they start praying again at the alter of the DC rumor mill.