Stung by the GOP’s midterm election gains in 2010, Obama took stands that differ from his current positions on raising tax rates, adjusting Social Security and other topics now dominating Washington as a Dec. 31 deadline nears.
Sometimes gleefully, Republicans throw Obama’s old words back at him. They portray him as inconsistent at best, insincere at worst.
The strategy has limits, however. Elections make a difference.
Obama signaled last year he would give ground on income tax rates and entitlement programs, after his fellow Democrats suffered what he called a “shellacking” in November 2010. Republicans took over the House, and the GOP saw Obama as vulnerable in 2012.
But he turned the tables last month. His party gained House and Senate seats, while he handily won a second term with a campaign that explicitly called for raising tax rates on incomes above $200,000 for individuals and $250,000 for couples. Republicans have adamantly opposed higher tax rates for anyone.
Republicans can complain all they want, Obama supporters say: Democrats won the last election, so the ghosts of debates past are banished, and Obama’s current positions are the ones that matter.
Nonetheless, Republicans keep reminding Americans of his previous positions, hoping for any edge in the partisan arguments over the fiscal cliff. The combination of major tax hikes and spending cuts will start affecting nearly every American in January if lawmakers and the White House can’t reach a compromise deficit-reduction plan by Dec. 31.
The previous Obama positions that Republicans love to recount include:
• Tax revenues. At a July 2011 news conference, Obama said the government could increase such revenues by $1.2 trillion over 10 years without raising income tax rates. It could be done, he said, “by eliminating loopholes, eliminating some deductions and engaging in a tax reform process that could have lowered rates generally while broadening the base.”
Republican leaders favor just such a policy of “tax reform” that lowers or maintains current income tax rates.
Earlier this month, however, Obama told business leaders that higher tax rates on the nation’s wealthiest earners are essential to reaching necessary revenue targets. He’s now asking for $1.6 trillion over 10 years, but lawmakers say a compromise of $1.2 trillion, or less, is possible.
“We’re not insisting on rates just out of spite or out of any kind of partisan bickering, but rather because we need to raise a certain amount of revenue,” Obama told members of the Business Roundtable.
Conservative columnist Charles Krauthammer calls Obama’s revised views “situational mathematics.”
• Social Security: Last year, Obama engaged in closed-door negotiations with House Speaker John Boehner, R-Ohio, seeking a “grand bargain” for deficit-reduction. The talks ultimately failed, but the two men staked out positions that still follow them.
Obama agreed to a less generous cost-of-living adjustment formula for Social Security, the popular but costly entitlement program for older Americans. He knew liberals would dislike it. But then, as now, Republicans said they would never agree to higher tax revenues without curbs on projected entitlement spending.
Now, the White House says Social Security should not be part of the fiscal cliff negotiations.
“We’re prepared to, in a separate process, look at how to strengthen Social Security,” Treasury Secretary Tim Geithner said this month on ABC’s “This Week.” “But not as part of a process to reduce the other deficits the country faces.”
• New Revenue Target. In last year’s “grand bargain” negotiations, Obama sought $1.2 trillion in new tax revenues over 10 years. But he signaled he could live with the $800 billion that Boehner proposed, if it accompanied a smaller batch of spending cuts.
Now, Obama says $1.6 trillion in new revenue is needed to help tame the nation’s borrowing habits. Boehner is sticking with $800 billion.
Obama’s $1.6 trillion, 10-year target came from his 2013 budget proposal, which Congress quickly killed. The president rarely mentioned the $1.6 trillion goal in his re-election campaign. In fact, Republicans say he left many voters the impression that what he really cared about was achieving $800 billion, mainly by raising tax rates on the wealthy.
Democrats reject the claim. But it hasn’t stopped Republicans from accusing Obama of pulling a bait-and-switch.
The president’s proposal “calls for $1.6 trillion in new tax revenue, twice the amount you supported during the campaign,” Boehner and others said in a letter to Obama this month.
• Tax Increase Ramifications. One of Obama’s most revisited comments came in August 2009, before the 2010 GOP election triumphs and when U.S. unemployment was 9.7 percent. In an interview, he seemed to raise doubts about his own push to raise taxes on the wealthy.
“The last thing you want to do is to raise taxes in the middle of a recession because that would just suck up, take more demand out of the economy and put businesses in a further hole,” the president said.
Technically, the recession had ended two months earlier. But even today, with unemployment at 7.7 percent, many Republicans and some economists say it’s unwise to raise taxes.
“So we’re not now in an official recession — “just the worst recovery since World War II,” said a recent op-ed piece in the Pittsburgh Tribune-Review, one of many such commentaries. “But now it’s OK to raise taxes and put ‘business in a further hole’?”
Boehner also must live with ghosts from the failed “grand bargain” talks of 2011. Chief among them is his willingness to generate $800 billion in new federal revenue over 10 years. Some conservatives call it overly generous.
“Speaker Boehner’s $800 billion tax hike will destroy American jobs and allow politicians in Washington to spend even more,” said Sen. Jim DeMint, R-S.C.
Democrats scoff. Their party prevailed in last month’s elections, they say, so the ground has shifted in Obama’s direction. For now, the Republicans can do little more than remind the president that he wasn’t always so ambitious about raising new revenues.