Obama is not serious about a ‘Grand Bargain’

Obama is not serious about a 'Grand Bargain'

In yet another speech on the economy, President Barack Obama offered Republicans a “grand bargain for middle-class jobs” that would purportedly reform the U.S. corporate tax rate and use the billions of dollars in new revenue generated by closing loopholes to create more jobs through a new stimulus effort.

At an Amazon.com Inc. warehouse facility (nothing like more middle-class warehouse jobs paying $11-per hour — thank you, Mr. President!) in Chattanooga, Tennessee, Obama claimed he wanted to break through congressional gridlock  and concocted a plan to satisfy both Republicans and Democrats (because he, just a moderate outsider, is caught in the middle of Washington bickering), offering to lower corporate rates and raise the top marginal tax rate on small businesses.

You might find the idea of sucking more “revenue” from the private sector to “create jobs” strikingly counterintuitive, but let’s stick with the alleged intent of the president’s proposal.

To begin with, if the president were making a genuine effort to negotiate with Republicans on a long-term comprise, would he do it in a political speech that preempts any substantive discussion with the opposition? Seems unlikely. Here’s a tweet from the Press Secretary for House Speaker John Boehner:

Yet, even if Boehner knew about the impending offer, he would have to reject it, because in substance it’s not an offer at all. The fact is that Obama is proposing less now than he did when the White House and Boehner almost came to an agreement on a Grand Bargain a few years ago. We just have another stunt meant to frame the opposition as obstructionists just as both parties head into budget negotiations. And with a little help from friends, it’s sure to work.

Most news stories regarding Obama’s ‘grand bargain’ fail to show any skepticism towards the claims or his formulation. Obama, they report, is willing to give in on tax cuts (the GOP’s ask) for “jobs” (Obama’s main concern) as if there is no question that stimulus spending offers a sustainable boost to employment.

Naturally, most stories assert or imply that Obama is offering a “compromise” by proposing to reduce the top corporate rate for most companies to 28 percent –25 percent for manufacturers — in exchange for more spending. When actually, Obama has supported eliminating tax breaks in exchange for changes in interest deductibility and other “loopholes” since he first became president.

Here’s a sampling of his support:

July 31, 2008: “He would like to cut the corporate tax rate, and it’s a question that we’re studying,” Jason Furman, Obama’s director of economic policy, told Forbes.com in an interview.

Oct 5, 2010: Obama: Corporate Tax Rate Cut Could Be “Win-Win”

Jan 26, 2011: Obama Backs Corporate Rate Cut Along With Tax Simplification

Feb 22, 2012: Obama Offers to Cut Corporate Tax Rate to 28% – NYTimes.com

In the first debate against Mitt Romney: “When it comes to our tax code, Gov. Romney and I both agree that our corporate tax rate is too high, so I want to lower it, particularly for manufacturing, taking it down to 25%. But I also want to close those loopholes that are giving incentives for companies that are shipping jobs overseas.”

So how’s this a bargain? If Obama’s views happen to converge with Republicans on tax reform, he is not offering a concession, he is finding a point of agreement.

Since announcing this proposal through the press is meant for the press, there is a high chance of success. Here’s one example of why Republicans (who can blame themselves for much) continue to lose the public perception game on issues like a potential government shutdown. The below tweet is from the senior political editor of NBC News, a person the public is asked to believe is an impartial journalist, a professional who has earned the public’s trust:

Actually, you have nothing of the sort. What you have is the White House making an offer it knows will be rejected because it offers nothing; once again, you have GOP rejecting a dummy offer, as expected by both sides; and once again, you have the GOP sitting on over 20 bills that deal with the economy which the Senate refuses to look at and Obama pretends do not exist. Mostly though, you have a press failing its viewers and readers by doing the president’s work for him.

—————————
Follow David Harsanyi on Twitter @davidharsanyi.

Sign Up
DISQUS COMMENTS

FACEBOOK COMMENTS

Comment with Facebook