Obama’s Tax Trap

[applegrove]

Obama’s Tax Trap

By Alec MacGillis at Slate

http://www.slate.com/articles/news_and_politics/politics/2015/01/barack_obama_s_state_of_the_union_tax_proposal_the_president_s_program_will.html?wpisrc=obinsite

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And it’s not just Romney. A whole assortment of 2016 aspirants, including Jeb Bush and Sen. Marco Rubio, as well as prominent congressional Republicans such as Rep. Paul Ryan and Utah Sen. Mike Lee, have been rushing to show their concern for the plight of the economically immobile and downtrodden. In essence, Republicans have responded to the increasing signs of a strong economic rebound under Obama by arguing that the rebound has failed to reach those lower down the economic ladder—a rather remarkable turning of the rhetorical tables by the party that in 2012 nominated a candidate who wrote off the bottom 47 percent of taxpayers.

Some of these Republicans’ proposals—to expand the earned income tax credit or child tax credit, for instance—hold real promise. But there is a big problem with this new anti-poverty, anti-inequality platform, one that gives all this new rhetoric an air of unreality: The party remains at its core committed to fighting solutions that would come at the expense of the very wealthiest Americans, even at a time when that upper-upper echelon is achieving truly historic levels of affluence. Just look at what has been the first order of business for Republicans after they won full control of Congress for the first time in eight years this past fall. It’s not expanding the earned income tax credit, but rather pushing a Wall Street wish list for tweaks to weaken the Dodd-Frank financial reform law of 2010.


This will likely prove to be the primary achievement of Obama’s new tax proposal, which, as he bluntly put it in Tuesday night’s speech, is targeted at “giveaways the superrich don’t need” and “lobbyists [who] have rigged the tax code with loopholes that let some corporations pay nothing while others pay full freight.” No, it’s not going anywhere in a GOP-led Congress. But it has served to call the bluff of the Republicans now claiming the mantle of inequality warriors. The proposal has led them into a political trap, prompting them into an instinctual, reflexive defense of the wealthiest Americans. And it has thereby clarified the discussions to come on the campaign trail over the next year and a half. Talk all you want about restoring shared prosperity, Obama is saying, but this is the kind of reform it will take to bring balance to an economy that has gotten so top-heavy and out of whack. The proposal will implicitly admonish not only Republicans but also Hillary Clinton, should her own Wall Street sympathies and upper-bracket aspirations keep her from adopting an aggressive platform to tackle inequality.


Romney was hardly the only figure on the right being provoked into a clarifying response by Obama’s speech and proposal. Jeb Bush declared on his own Facebook page that it was “unfortunate President Obama wants to use the tax code to divide us—instead of proposing reforms to create economic opportunity for every American.” Then there was Michael Cannon, the Cato Institute analyst who has helped drive the latest legal challenge that threatens to upend Obamacare, who tweeted during the speech:



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