Monday, September 6, 2010

Will Republicans Vote On Obama's Tax Cuts?

I saw this article on Bloomberg News by Nicholas Johnston and thought it sounded interesting - President Obama is preparing to ask Congress to consider a tax credit for research and development businesses, totaling $100 billion over ten years.
It’s just one of several ideas Obama has promised to roll out to encourage hiring. White House economic advisers are also considering more tax breaks for small businesses and new spending on infrastructure, according to congressional aides familiar with the discussions who spoke on condition of anonymity because talks are preliminary.

The research tax credit is “very important in terms of job creation over the longer term,” Laura Tyson, an economics professor at the University of California at Berkeley and a member of Obama’s Economic Recovery Advisory Board, said on CBS’s “Face the Nation” program yesterday.

The research credit won’t have “as immediate a job impact as, say, movement on the current tax credits for the unemployed or extending a payroll tax holiday of some sort,” she said.

Every president since Bill Clinton has backed a permanent extension of the research tax credit, which Congress only temporarily extends because of its high cost.
My question is whether Republicans would vote for the president's initiative - especially during a heated election year.  If they oppose the measure, they run the risk of being called out on their obstructionist ways by Democrats.  It appears that Republicans are prepping for their "no" vote, with members of the GOP already coming out criticizing the administration.

“They are just flailing around,” once-alleged "maverick" John McCain said on the “Fox News Sunday” program. “If we had done this kind of thing nearly a couple of years ago we’d be in a lot better shape.”

McCain's comments make no sense because if he votes against the tax credit now, he is basically saying he doesn't care about the future, since by his own admission we would be i a lot better shape after these kinds of actions.  I agree partially with McCain on this issue - I would have liked to see more legislation like this a couple years ago but again, McCain's argument is flawed - hindsight is 20/20.  Also, as the Johnston article points out, Senate Republicans blocked small business legislation passed by the House right before they went on vacation - presumably to prevent their low-tax loving members to have to vote with the Democrats right before their teabaggers go to the polls.

Christina Capatides and David Kerley wrote the following for ABC News:
The new plan implies a sort of political dare, challenging Republicans not to pass popular tax cuts before the November elections.

It may seem counterintuitive for the president to intend for Republicans to block his proposed tax credits, but many pundits believe that such an outcome would benefit the Democrats' congressional interests.

"It allows him to define the Republicans as the party of no," says Karen Finley, a Democratic consultant. "If Democrats seize on that opportunity, I think that's a great opportunity for Democrats."

This sort of sly maneuver is crucial for the Democrats at this stage of the game because the most recent polls show that Republicans are gaining ground -- even in traditionally Democratic areas, likes California and Wisconsin -- and becoming increasingly confident that they will take back control of the House.

"What you're seeing right now is this real groundswell of anger against the Democrats and against their agenda," says Kevin Madden, a Republican consultant. "Folks are looking for the alternative and the alternative happens to be the Republicans."

And Republicans say they don't believe the president's new proposals will help his party's cause. On "Fox News Sunday," Republican Sen. John McCain accused Obama of having no plan at all.
I emphasized the last paragraph for one important reason - John McCain had indicated on that same program that Republicans had no agenda.

Basically, Republicans are gaining momentum because of the media's perpetuation of The Spiral of Silence - the fringe conservatives have been extremely vocal in pushing their "successes," bullying the "mainstream media" to report on their minority-held beliefs.  In turn, the right-wing has become more bold in their attacks, stepping over Democrats in the process, and the president is partially to blame for this, fitting within the Spiral - in an attempt to not offend the right-wing minority, Obama had attempted to have a bipartisan approach to governing, which the fringe exploited by acting offended anyway, thus winning even more concessions.


  1. I predict that Republicans will slow this down, trying to avoid a vote on it before November.

  2. I suspect the same, and then after the elections they might vote for it claiming that they are not the party of "no" pointing to their support as proof...


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