On Dec. 6, after weeks of negotiation, President Obama announced a deal with Republicans that will extend the Bush tax cuts for all Americans, including those who make over $250,000, for two more years. This “compromise” was undeniably one-sided. Obama surrendered on one of his central campaign promises—no new tax breaks for the top two percent of earners—and even agreed to additional cuts in the estate tax, another benefit to the wealthiest Americans.
In return, Republicans only agreed to extend unemployment benefits for another 13 months. The deal will increase the national debt by upwards of $500 billion, and because so many of the cuts go to the wealthy, who are unlikely to greatly increase their spending, the cuts will do little to stimulate the economy. If Obama truly had been concerned with improving the economy, and not just passing legislation to create the appearance of effective action, he should have recognized the shortcomings of this deal.
Two years from now, when Obama is seeking reelection, it will not matter to voters whether he worked across the aisle or considered Republicans views. What will matter is whether the American economy is still suffering or if it is growing. This type of legislation won’t spark real growth, and if Obama fails to win reelection in 2012 because of a stalled economy, any hope of effective fiscal stimulus will die with his presidency.
Obama, in defending his compromise, said now was not the time to play politics—but that is exactly what he did. The Republicans had been playing politics for weeks, blocking progress on major legislation like the New START deal for nuclear arms reduction, the repeal of Don’t Ask Don’t Tell, and the extension of unemployment benefits that are the only lifeline left for thousands of unemployed Americans. With this deal Obama is playing into Republicans’ hands, letting them obstruct and then scale back efforts rational legislators should support.
But now that the Republicans no longer have an excuse to avoid action on issues like the START deal, DADT, and the Dream Act, the deal offers Obama the chance to salvage key parts of his agenda and redeem a compromise that will add billions of dollars to the nation’s debt. Obama has shown he is willing to negotiate. Now he has to make it clear that the Republicans have to do the same, and force them to take up these issues. If he can do that, then his capitulation and the billions of dollars of deficit spending to pad the pockets of the wealthy will not have been in vain.
