The Bush Tax Cuts, GOP Intransigence and Obama's Ace in the Hole

The biggest driver of our debt and deficit spending over the last decade was the ill-conceived tax cuts of the George W. Bush administration. They were touted as an answer for job creation after a fairly mild recession brought on by a High Tech bubble burst, yet Bush left office, after 2 terms, with the worst job creation figures on record.

To add insult to economic injury, the largesse of these tax cuts, went predominately to "job creators," the new moniker the GOP invented yesterday to confuse just who the true recipients of these tax cuts were....the rich! The "job creators" set about shipping millions of jobs overseas and banking the profits. No one noticed because of the fantastical housing bubble, where either home prices would rise forever (not), or financial institutions would be on the hook for countless toxic loans of their own creation, which many of them were even betting against, to essentially insure a financial meltdown in 2008.

Which brings us to today, with the largest debt and deficit on record because of ongoing attempts to clean up this mess, yet the Bush tax cuts live on, underlining the greatest wealth disparity since the days of Robber Barons. They continue only because of insistence, by the Republican Party, yet this same party refuses to raise our debt ceiling, to cover the costs already incurred, let alone the future costs of the cuts they demanded. The Bush tax cuts are set to expire the end of next year. If they are left to expire, as David Leonhardt pointed out in an April article in the New York Times, we could solve about 75% of the deficit problem over the next 5 years.

And herein lies President Obama's ace in the hole in negotiations with the GOP over raising the debt ceiling, as they continue to refuse revenue raisers. He can sign off on much of their proposed debt reduction and get the debt ceiling raised, preventing a default, which will stabilize financial markets in the near term. There is no GOP jobs bill and there won't be with such an agreement because the financial means won't be there to implement one. They ran on Jobs but will only be able to show losses because they insisted on maintaining tax cuts and subsidies to people and companies who aren't creating them, or sending them somewhere else.

Barack Obama will run, in part, on that feckless record and he'll win. And when he does, kiss the Bush tax cuts goodbye!