Nick Gillespie prognosticates the fate of the "Bush tax cuts" in the pages of The New York Post:
So now House Speaker Nancy Pelosi is lobbying for what she calls "Obama middle-income tax cuts" as a way to goose the struggling economy. At the same time, she insists that past cuts for higher earners "only increased the deficit."
She says we can afford $3.2 trillion a year $320 billion a year in "Obama" cuts, but not $70 billion in "Bush" cuts.
Even in Washington, few topics are as heated—or confusing—as the wrangling over whether to extend the so-called Bush tax cuts….
But President Obama (now joined by Pelosi) insists that he only wants to kill the Bush cuts for individuals making more than $200,000 and households pulling in more than $250,000. The CBO figures that sticking it to just those top earners will bring in $700 billion over the next 10 years, or $70 billion a year on average.
Which means that Obama is leaving $3.2 trillion on the table even as he argues that we need every penny to pay for bailouts, health care, new stimulus spending extended unemployment benefits and so on….
Despite a 2010 deficit projected by the CBO to be about $1.34 trillion—and the lack of even the start of a budget for fiscal year 2011, which begins on Oct. 1—Obama is pushing what the Associated Press calls a $20 billion "pre-election shopping list" filled with goodies for public schools, the Post Office and other likely Democratic voters.
Given that sort of politically motivated free-spending, it's no wonder that 31 House Democrats, fearful of being seen as tax hikers right before a tough midterm election, are siding with Republicans pushing to extend all the Bush tax cuts, even the ones for top earners, for at least a year or two more.
This year's federal budget is around $3.6 trillion, which makes the $70 billion that will stick in the wealthiest Americans' pockets seem like loose change. Expect the "Bush tax cuts" to be extended for all.
And then, in a year or two, when federal spending is higher than ever, expect a heated—and confusing—discussion about how "the Obama middle-income tax cuts" and the Bush tax cuts for "the rich" created massive and unsustainable deficits.
But expect Nancy Pelosi, who might not be speaker anymore, to tell you that it was that $70 billion that really tipped the federal balance sheet.