The fallacious GOP stand on tax cuts

Posted Nov. 17, 2010, at 7:07 p.m.

Barack Obama has restored integrity and vision to American leadership. He keeps the broader national interest in mind whether promoting health care or seeking to reduce nuclear weapons. But he’s a lousy politician.

Even the president admitted that Sunday when he conceded that he’d been too wrapped up in numerous policy debates. He has a point. Any president saddled with a disastrous economic situation and two wars would be preoccupied.

But my disappointment in the campaign, and the “shellacking” Obama and the Democratic party received, lies mainly in his failure to take a tougher stand against the filibuster-fueled obstructionism of a “do-nothing” Republican minority and the divisive lies and character assassination of “Know Nothings” like Rush Limbaugh and Glenn Beck.

Obama, his Chicago mafia and Democratic leaders are to blame for allowing the Republicans to get away with distortions and falsehoods on many issues, from scare tactics on health care to accusations of “appeasement” for seeking ways to contain Iran’s nuclear ambitions without another war.

Obama has made his share of mistakes in two years. Spending too much time and energy on health care is one; allowing Nancy Pelosi to lead the way another. His domestic focus should have been riveted on the economy. With the short-term fixation of Americans, it’s clearly not enough to stop the free fall, place the economy on a better path, and reform the financial sector. Obama even had major successes: the bailout of General Motors, which critics said “Let fail” with 1 million jobs lost.

Abroad, Obama’s pragmatic, if still unfinished policies have renewed respect for the United States throughout the world.

Many pundits, though, keep citing a poll that two-thirds of Americans feel the United States is in decline.

It is. And who is largely responsible for the decline? It is not Barack Obama.

When George W. Bush came to office in 2001, the United States was a feared hyperpower (not just super). The American century had begun. The economy was humming; the budget was in surplus — by $236 billion.

And eight years later? After two unfunded wars, one of them a reckless, $1 trillion intervention, tax cuts for the wealthy, and the worst economic meltdown since the Depression, the country handed over to Barack Obama was in grave economic danger. Iran was winning the Iraq war; Afghanistan was neglected; and we were in hock to China (which financed Bush’s wars and tax cuts).

Personally, I have confidence in the resilience of the American people and the ability of a stagnant economic system to recover its footing — with one caveat, our politics.

In terms of national security, our power relative to other countries has declined, partly due to overreach, partly to growth of emerging countries. But America retains the most formidable military forces, strong alliances and technological resources to remain the sole global superpower.

Our resourcefulness and innovative spirit should help to revive our economic dynamism. Silicon Valley and our open society remain a magnet to the world.

But the Achilles Heel of the American future is a dysfunctional political system — due mainly to growing polarization, an explosion of hidden money in campaigns, and the shouting matches that pass for journalism in the mass media.

The coming weeks and months will go a long way to determining whether party leaders can put aside narrow political agendas and start placing the national interest first and foremost or persist in gridlock. Both renewed economic activity and long-term investments in education and infrastructure are essential to get back on the right track.

And the issue of tax cuts should provide a telling signal.

There is no more fallacious argument than the Republican and Tea Party claim that tax cuts for millionaires and billionaires will get the economy going again. Those billions don’t “trickle down.”

The brutal fact — one Obama has not made effectively — is that extension of tax cuts for the wealthiest 2 percent of Americans will add $700 billion to the deficit.

Why Obama and company did not change their $250,000 floor for further tax cuts is baffling. A $1 million cutoff would be a sensible compromise.

To my mind, the single most worrisome factor in the declining condition of the United States is the rapidly growing disparity of wealth between the super-rich and the rest of the country.

Over the last 30 years, the top 1 percent of the country soaked up 36 percent of all gains in household income. In stark terms, 300,000 tycoons have more income than 180 million Americans. “The collapse of the middle class and the huge transfer of wealth to the already wealthy is the biggest domestic story of our time,” Jonathan Alter observes in a recent review of “Winner-take-all Politics” by Jacob Hacker and Paul Pierson.

Can John Boehner and Mitch McConnell support that — and still claim they’re for the middle class?

Fred Hill, of Arrowsic, was a foreign correspondent for The Baltimore Sun and later worked on national security issues at the Department of State. His email address is fhill207@gmail.com.

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