Articles

Obama and the Democratic Revolt

December 07, 2010

For agreeing to a temporary extension of all the Bush tax cuts, President Obama is now facing a full-fledged revolt within his party. The responses from congressional Democrats have ranged from chilly to angry to threatening.

One asked, "Could we have a little fight before we cave? Why go right to surrender?" Another accused Mr. Obama of saying, "let 'em eat cake." Another called the compromise "an absolute disaster" and "an insult." Another complained, "we got screwed."

Liberals outside Congress are even more bitter. MoveOn.org demanded Democrats not "capitulate to the GOP on this terrible deal." Some have talked of primary challenges to Mr. Obama.

It won't be easy for Mr. Obama to push the compromise through Congress. Nancy Pelosi doesn't see where the votes will come in the House. Harry Reid's spokesman says simply that the majority leader "plans on discussing it with his caucus."

Despite the challenges, Mr. Obama should find a sizable constituency for his plan among DemocratsDespite all this, Mr. Obama should actually find a sizable constituency for his plan among Democrats. By my count, roughly 50 House Democrats have already signaled that they may sign on to a compromise like the one announced this week.

In a man-bites-dog moment in September, 31 Democrats signed a letter telling Ms. Pelosi that now was not the time to raise any American's taxes. It was smart politics. As a new poll from American Crossroads (a group with which I'm associated) has found, Americans believe—by a 4-to-1 margin—that raising taxes in a recession will hurt growth, and that tax rates should stay where they are so employers start hiring again.

On Dec. 2, another 12 House Democrats broke from their leadership by opposing the rule under which Ms. Pelosi's tax measure—which would have let the cuts lapse for Americans in the top brackets—was going to be taken up. Doing so suggested that they wanted the House to consider a GOP substitute measure extending all the Bush tax cuts.

There was also a ragtag group of seven House Democrats who didn't sign the letter or oppose the rule but did vote "no" on the final Democratic bill. Some in this group are liberals who probably object to keeping any of the tax cuts, but others may support the compromise.

Combined, these three groups contain 50 House Democrats who either (a) publicly endorsed keeping all the tax cuts, (b) broke with Democratic leaders on a key procedural vote, or (c) voted against a bill that extended only some current rates. Added to the GOP's near-unanimous support for extending all the Bush tax cuts, their numbers could produce a House majority for the president.

But convincing them won't be easy: Last month 22 of the 31 Democratic letter-writers broke their word and voted to let the cuts lapse for the top brackets, and last week only four of the 12 Democrats who bucked Ms. Pelosi on the procedural vote joined Republicans in opposing her bill.

Still, these are the House members who could hand Mr. Obama the compromise he now seeks. So the White House's lobbying priorities in the coming days will be members of the president's own party.

In the Senate, with its 60-vote requirement, two of the 42 Republicans have come out against the compromise and eight Democrats are on record favoring extending all the Bush tax cuts. That would leave the Senate with 48 in favor of this week's compromise and 52 opposed or up for grabs. A strong vote out of the House might swing more Senate Democrats toward "yes," but winning will require Mr. Obama's engagement and a deft White House lobbying effort. That's especially true since some Democrats are now threatening a filibuster.

So far the White House hasn't inspired confidence. Mr. Obama's Tuesday press conference, in which he compared Republicans to "hostage-takers" and accused liberal Democrats of being "sanctimonious," offended everyone. He has a huge amount riding on this compromise, so he has to do better.

Mr. Obama's advisers are reportedly warning Democrats that allowing taxes to rise may cause a double-dip recession. The president can also warn them that it'll be worse to settle this issue after Republicans take over the House in January.

If he fails, taxes will go up for every American on Jan. 1. If that happens, the new Congress would likely rectify the situation within days after being sworn in. The political damage to Mr. Obama would not be undone nearly as quickly. Failure to pass the tax compromise would make the president appear impotent. Confidence among Democrats would collapse. And there would be more challenges to Mr. Obama's leadership from within his own party, perhaps even in the 2012 primaries.

Most importantly, failure would imperil $400 billion in tax cuts that would be a more effective economic boost than Mr. Obama's justifiably ridiculed stimulus. Without much healthier economic growth and far more robust job creation, Mr. Obama has little chance of wooing back the independents who elected him in 2008 yet abandoned Democrats in 2010.

This article originally appeared on WSJ.com on Wednesday, December 8, 2010.

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