A compromise is shaping up over the fate of the Bush-era tax cuts set to expire at the end of the year. On Saturday, Republicans blocked a Democratic push to extend only the cuts on those earning less that $1 million a year, and the final package is now sure to include the GOP's wish to extend the cuts for all tax brackets. Many Democrats are not happy about this, but some of their concerns, like extending unemployment insurance, may survive. Is this a victory for the GOP and a disaster for Obama? (Watch a CBS News discussion about a potential compromise)
Obama caved — and will pay the price: This tax deal is "Obama's latest and perhaps most humiliating attempt to placate his Republican captors in Washington," says Frank Rich in The New York Times. "The captors will win this battle," and the resulting "economic disaster" will crush Obama and the Democrats in 2012. No wonder Democrats are outraged: Obama is such an inept negotiator you'd think he has "Stockholm Syndrome."
"All the presidents' captors"
He had no choice: Republicans had a stronger hand: Liberals gripe that Obama "played a poor game of poker," says Nate Silver in FiveThirtyEight. But the Democrats' hand "is not very strong." Obama has the polls on his side, but he can't credibly bluff that he will let middle class taxes rise, so all he's left with is a few "consolation prizes": Helping the uninsured and making the GOP vote against middle class tax breaks.
"The Democrats' tax cut dilemma"
Whoever wins, the real loser is the deficit: It may be a win for Republicans, but the deal "has turned into a deficit hawk's worst nightmare," says Derek Thompson in The Atlantic. Instead of "saving the Treasury about $700 billion in revenue" by letting the top Bush tax cuts expire, we're now getting an "11th hour stimulus" for the Democrats in the deal. That may be "wise," and it's certainly "good news for Democrats," but forget "budget sanity."
"New deal: Bush tax cuts + stimulus tax cuts + jobless benefits"
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- Why you should stop believing in evolution
- The real lesson of Rick Perry's mug shot
- How Israel's hawks intimidated and silenced the last remnants of the anti-war left
- Welcome to the age of ambivalent feminism
- The secret to handling pressure like astronauts, Navy SEALs, and samurai
- Why China thinks it could defeat the U.S. in battle
- 10 things you need to know today: August 20, 2014
- How Ferguson made conservatives lose faith in the police
- What the 'death of the library' means for the future of books
- How the West produces jihadi tourists
Subscribe to the Week