House Democrats caucusing today reportedly voted down President Obama's taxes/unemployment compromise, objecting to the generous breaks on the estate tax and generally having been left by the curb. It's not a binding vote. In the Senate, key Republicans say they're also not happy with the estate tax, in that it exists at all.
Quick, economic adviser Austan Goolsbee to the whiteboard!
First, Goolsbee on President Obama's continued objection to continued tax cuts for the wealthy: "The president's position has not changed. He does not support and does not think that this will work for the economy."
Got it. President Obama just did something that he doesn't think will work. Awesome. And now for those tax cuts for the working and middle classes: "But the other thing that hasn't changed is Republican intransigence in Congress. And we've now come up to the very deadline when these tax cuts would expire and deal a very really heavy blow to the overall economy."
So yes, President Obama just did something that he doesn't think will work in order to do something that he thinks will work well enough to outdo the damage, because despite his party controlling the White House, Senate and House of Representatives, he had no choice. That's at least a nuanced sell, and apparently a tough one.
After the jump, Vice President Joe Biden takes a turn.
Mr. Biden sent out an e-mail blast this morning headlined "Here's the Deal." And here it is:
The bottom line is that if Congress does not act to extend unemployment insurance, 2 million Americans will lose their unemployment insurance this month alone. And if we don't extend middle class tax cuts, millions of families will see a spike in their tax bill when they can least afford it.
With that in mind, President Obama reached across the aisle to ensure that middle class families get a fair shake. Here are a few important points:
- No tax hike for middle class families. This proposal would prevent a tax increase of over $3,000 for the typical family.
- Money in your pocket through a reduction in the payroll tax. About 155 million workers will see a 2 percent reduction in their payroll taxes and American families can take advantage of the Child Tax Credit, Earned Income Tax Credit, and the American Opportunity Tax Credit.
- Extension of unemployment benefits. Folks who have been looking for work in these tough times won't lose their lifeline. This is also good news for local economies because unemployment insurance dollars are among the most likely to be spent quickly.