Change We Can Believe In (including changing your mind): Obama ready to cut deal on Bush Tax Cuts

By CARRIE BUDOFF BROWN
11/11/10 
Politico

The White House signaled Wednesday that President Barack Obama is ready to cut a deal on the Bush-era tax cuts – accepting a temporary extension of the cuts for the wealthiest Americans to win renewal of tax breaks for middle-class taxpayers.

Such a deal would run counter to one of Obama’s longest-standing and most often-repeated promises from the 2008 campaign – that he would end the tax cuts for wealthier individuals.

But Obama’s top political adviser, David Axelrod, said Wednesday that the White House has to deal with “the world of what it takes to get this done” – a signal to Democrats that they don’t have the votes to kill the high-end tax cuts in the face of a new Republican House majority and resistance from Democratic moderates in the Senate.

“We have to deal with the world as we find it,” Axelrod told the Huffington Post.

Axelrod’s remarks confirmed what many on the Hill had long suspected, that lingering concerns over the weak economy and the political aftershocks of last week’s election would compel the president to accept a temporary extension of the high-end tax cuts.

The White House did not attempt to walk back the comments Thursday morning, arguing that Axelrod was echoing what the president already stated in his weekly address Saturday.

“The President has been clear that extending tax cuts for middle class families is his top priority and he is open to compromise to get that done,” White House spokeswoman Jen Psaki said in an email. “He has also expressed concern about the cost of making the highest income tax cuts permanent and is looking forward to discussing this and other issues with bipartisan congressional leaders next week.”

The nod to political reality is the kind of signal Democrats on the Hill have been seeking as they open negotiations next week with Republicans during the lame duck session of Congress.

But it is already being interpreted by the progressive base as a cave-in. They see little reason to cede ground to Republicans because polls show voters don’t favor renewing tax cuts for the wealthy. They say they want Obama to hold firm to his long-time campaign pledge to let those high-end tax breaks expire.

Jane Hamsher, a frequent White House critic, posted reaction last night to Axelrod’s comments under the headline, “Obama Twists Own Arm, Says ‘Uncle’ to Extending Bush Tax Cuts.”

“If he’s the ‘political genius’ guiding the Democrats these days, they should consider themselves lucky it wasn’t 100 seats” that they lost in the House, Hamsher wrote on her blog FireDogLake.

In his weekly address last week, Obama reiterated his campaign pledge of protecting the middle class tax cuts. He also said the country cannot afford to permanently renew the high-end tax cuts, which would cost $700 billion over the next 10 years.

He appeared to outline the shape of a potential deal: A temporary extension for wealthier taxpayers and at least a temporary extension for the middle class.

The tax cuts expire Dec. 31, placing pressure on Congress to strike a deal on an extension during the lame duck session.

"We don't want that tax increase to go forward for the middle class," Axelrod said. "But plainly, what we can't do is permanently extend these high income taxes."