President Obama called on Congress to pass a temporary, one-year extension of the Bush-era tax cuts for people who make less than $250,000 a year.

AP Photo/Susan Walsh

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n Monday, President Obama called on Congress to temporarily extend the Bush-era tax cuts for people with incomes of up to $250,000 a year while allowing the upper-income tax cuts to lapse. All of the cuts expire at the end of the year, at the same time hundreds of billions in spending cuts are set to kick in — an economic train wreck that Washington has dubbed the "fiscal cliff," or Taxmageddon. Republicans say Obama's proposal raises taxes on the rich, and amounts to class warfare. "But the tax debate isn't really about whether we should consume the delicious, delicious bodies of the rich, or even whether we should seize their money and give it to the peons," says Jonathan Chait at New York. Beneath the well-worn politics of the Bush tax cuts "there's a straightforward macroeconomic debate going on here." Are the Bush tax cuts helping the economy, or just helping the rich?

Low taxes for the wealthy help only the wealthy: Taxes on the rich and on investment income are already "at historic lows," and where has that gotten us? says Pat Garofalo at Think Progress. The rich are thriving, the rest of us are struggling, and "the job creation that was promised by the Bush administration" never materialized. That's not surprising: Historically, economic growth and job creation have been much higher when the top marginal tax rates are higher, too. So ignore the GOP's "fearmongering" claims about job-killing tax hikes on the rich: There's "no evidence backing them up."
"Why letting the Bush tax cuts for the rich expire will not hurt..."

In a weak economy, any tax hike is bad: If Obama's "economically damaging tax increase" had any chance of getting through Congress — it doesn't — it would be disastrous for everyone, not just the rich, says Curtis Dubay at The Heritage Foundation. When you soak "small businesses, investors, and entrepreneurs — in other words, job creators" — who's going to put America back to work? It's nice that Obama is finally addressing Taxmageddon, but his misguided solution would only make the weak economy worse.
"Obama finally enters the Taxmageddon debate — with a tax increase"

The biggest threat to the economy is Washington: The yawning fiscal cliff presents some hard choices for both parties, but playing legislative chicken — again — could be enough to drive the economy over the edge, says Ezra Klein at The Washington Post. If neither Obama nor the GOP budges before the election, businesses will have to prepare for the possibility that we're headed toward a preventable recession. Companies will do that by "pulling back this year in order to cushion themselves" — meaning layoffs and spending freezes, just in time for the big election.
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Read more political coverage at The Week's 2012 Election Center.