They expire next year.
President Obama has previously said:
“You don't raise taxes in a recession.”
But he’s also said that tax policy is a tool to make things fair. So, he’s willing to buck “every economist” who says that raising taxes in an economy as fragile as ours is today a bad idea and raise taxes on “the rich.”
What the American people will be feeling is what the late, great Winston Churchill observed:
The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of misery.
You think you’re miserable now, wait until Obama’s done with you.
There are two numbers that you’re hearing right now as regards the public debate over letting the rich get the shaft as it pertains to small businesses.
The GOP claim that over half of small business income would be affected by the tax hike.
The Democrats claim that 97 percent of small businesses would be unaffected by the tax hike.
Unusual in a political debate: both sides are correct.
But here’s why the Democrats’ number is largely irrelevant.
Think about it. Both those numbers are true – which means that 3 percent of the small businesses account for more than 50 percent of created wealth.
The 97 percent of small businesses report an income of less than $250,000 aren’t creating very many jobs. The 3 percent that do is where all the money – and jobs are.
And they’re the ones who are getting their taxes raised.
All of which poses an interesting political question, since more and more Democrats (like Obama’s former OMB director Peter Orzag) are siding with the GOP position on this issue, will the Congress pass an extension that extends all the Bush tax cuts and if they do, will Obama veto it?
If that happens, I can guarantee you the media template for the situation won’t be that Obama is bucking 95 percent of economists and risking a double-dip recession. It will be the same as the Clinton-Gingrich government shutdown in 1995 – it’s the GOP’s fault.
On a related note: Orzag also says in that column that all the Bush tax cuts – including those for the middle class – need to go in 2013 in order to pay for the unsustainable debt that Obama’s failed stimulus and Obamacare are destined to saddle us with. (The characterization of the debt problem is mine, not Orzag’s.)
Whatever the end result, the American people will be feeling the misery.