The polls are pretty much unanimous. When it comes to the so-called “fiscal cliff,” the public supports the president by margins even larger than those by which he won re-election in November.
Beginning in 2013, the automatic ending of the Bush tax cuts and automatic spending cuts would most likely send the economy into a recession. The president has made a proposal calling for what he calls a “balanced approach” of spending cuts with the ending of tax breaks for the rich, while the GOP’s counteroffer demanded larger cuts and much less in revenues.
Here are five reasons the Republicans have little to no leverage on the “fiscal cliff” other than a threat that the president will begin his second term cleaning up another Republican-sparked economic crisis.
The Public Is Against Them On The Issues
In almost every poll you’ll find 6 out of 10 Americans support higher taxes on the rich. Independents agree at about that same percentage. The question that isn’t clear from the polling is if the public wants higher tax rates or if ending deductions would be good enough. It’s also clear from polls that the so-called “entitlement reforms” the GOP wants are extremely unpopular (probably because they’re designed to eventually kill the program).
Photo credit: AP Photo/J. Scott Applewhite, file
For Four Years, They’ve Said Nothing But ‘No!’
On the night of President Obama’s first inauguration, a small group of Republican leaders, including Paul Ryan, met with messaging guru Frank Luntz and former speaker of the House Newt Gingrich to plot their strategy to counter the new president. It came down to one word: No. This recalcitrance and commitment to slow the recovery to a financial crisis that started when Bush was in office is finally having some blowback. Wall Street nemesis Elizabeth Warren is now on the Senate Banking Committee and the public simply doesn’t trust the GOP to negotiate in good faith. A recent poll from The Hill found that 50 percent of voters believe that President Obama and the Democrats are being “more reasonable” in the “fiscal cliff” negotiations than House Speaker John Boehner and the Republicans, compared to 38 percent who believe that Boehner and the GOP are being more reasonable. And the fact that nearly all the Republicans in Congress have signed a pledge to never, ever compromise on taxes certainly isn’t helping this image.
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Republicans Are Starting To Get Cold Feet
What was amazing about the stunt to hold the debt limit hostage for cuts was the solidarity from House Republicans as they vowed to stand together in threatening the global economy by defaulting on America’s debts. This time around a few congressman have made it clear that they should extend tax cuts for 98 percent of Americans. Tom Cole (R-OK) has called for a vote. Brian Bilbray (R-CA), who is retiring at the end of his term, and Mary Bono Mack (R-CA), who lost in November, also have joined the list of those willing to vote for higher rates in the right deal.
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The Hostage The Tea Party Is Holding? The Stock Market
Democrats like to say the GOP is holding middle-class tax cuts hostage. But their real hostage is the Dow. If they hold off on passing tax cuts for 98 percent of America until 2013, the only people who will feel the blunt impact of that choice at first is those people who are invested in the stock market. Of course, that will kill jobs and spike unemployment, making our jobs crisis worse, but those who have the most invested in the market, the rich, will likely see a loss that could easily equal the small tax increase the president is asking for on income over $250,000. This is the number one reason why corporate America is suddenly done with the Tea Party.
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Republicans got through most of 2012 without acknowledging reality. Then came the election. President Obama is the first president to be elected twice with 51 percent of the popular vote since Dwight Eisenhower. His popularity is hovering around it was around the time bin Laden was killed. He won by laying out the exact proposals he said he’s given to Republicans. He defeated a ticket that included Paul Ryan (R-WI), head of the House Budget Committee and “intellectual leader” of the Republican Party. If this battle lingers on, he’ll have the world’s greatest platform — his inauguration — to make his case to the people. And he never has to be elected again. If you’re negotiating, this is the position you want to be in.
Photo credit: AP Photo/Carolyn Kaster