Obama appears desperate to make a deal which includes permanently extended Bush tax cuts for those families making <250k and extended for two years the tax cuts for those making >250k
http://www.msnbc.msn.com/id/40150244/ns/politics-white_house/
Looks like the GOP might be able to force his Obama into extending the tax cuts for all income brackets. If no deal is struck in the lame duck session, the GOP will be in the drivers' seat Jan 3 2011 - H.R. 1 will be reserved for extending the tax increases and the Dems can not afford to have the Senate block or Obama to veto the bill.
The GOP needs to go for it all.
Something inside of me really wants him to just say "the heck with it" and let ALL of the Bush tax breaks expire, then brag about making tough choices to cut the deficit. Brag that our tax rates are still among the lowest in the developed world, by a mile. He needs to attack that taxes always = bad meme head on to create needed ideological daylight between him and the House GOP. It would also avert any left wing primary challenges in 2012.
Taxes ARE always bad. It's not a meme.
No, not always:
1. Taxes to fund public infrastructure se also: roads, utilities, waterways, electrical grids, sewage treatment plants, public education, national parks etc- in almost all cases no rational individual or subgroup of individuals will actually build/establish these things because they know that they will accrueo only a tiny fraction of the benefits
2. Taxes to correct market externalities and tariffs on foreign trade with nations that do not recognize these externalities- see also antitrust regulations, Clean Air Act, Clean Water Act, courts to protect entrepreneurs against patent/copyright infringement, climate change legislation, etc.
3. Taxes and regulation to avoid excessive exploitation of common resources: creating National Parks, hunting fishing permits, waste disposal permits, gasoline taxes for the upkeep of infrastructure, etc.
4. Taxes to facilitate equal opportunity and negative rights by ensuring equal access to some basic goods and services to everyone in society: Social Security, Medicare, Civil Rights regulations, Medicaid, Health Care Reform (debateable, but this is the premise under which it is justified), TANF, SCHIP, ADA, public education again, etc.
Very few sensible people would dispute the economic benefits arising from #1-3. Some may think that #2 has been taken too far in recent years, but to deny the existence of externalities altogether, especially environmental ones, belies a pitiful understanding of modern economics. A number of people will say that #4 could be left to private charities, but few would want to return to the income inequality of the late 19th century, which was the last time in American history that these functions were left to private charities, who, like it or not, were overwhelmed by the scale of need and urban poverty in the emerging industrial society.
