(AP Photo/Carolyn Kaster)
Progressives have plenty of reason to be concerned about the upcoming fiscal cliff negotiations. There was the ugly “grand bargain” Obama reportedly agreed to in 2011, which would have kept all of the Bush tax rates while raising $800 billion in unspecified tax code simplification (yes, this is basically the Romney plan) while cutting deeply from domestic spending, Medicare and Social Security. And even in recent days, top Democrats like Senator Chuck Schumer have been saying they would be willing to “compromise” on the Bush rates, and leave them alone while raising revenue elsewhere.
But the White House is apparently tossing down the gauntlet—on taxes and entitlement cuts. Wednesday morning, The Washington Post reported that Obama’s opening bid on taxes is to raise $1.6 trillion in revenue, via not only the expiration of the Bush rates on earners over $250,000 but also the Buffet Rule, the restoration of the estate tax to 2009 levels, deduction limits and closing tax loopholes.
And at the White House on Tuesday, Obama, Vice President Biden and the president’s economic team met with a coalition of liberal groups and assured them the administration would hold the line on both taxes and protecting safety net beneficiaries, according to several attendees interviewed by The Nation.
“I was actually very pleasantly surprised. I feel like I was not expecting it to be a particularly good meeting,” said one attendee. “I feel like the president was extremely committed on the tax issues, in kind of ‘throw-down mode’ on those.”
“It was clear that you couldn’t get there on the deductions,” said the attendee, thus undercutting the plans floating around Washington in recent days. “There was some exchange on the deductions. I think that was where there was no give…. there was real strength on the amount that needs to be generated by tax increases.”
The liberal groups, mainly unions, think tanks and advocates for safety net beneficiaries, met with Obama and Biden along with senior adviser Valerie Jarrett, director of the National Economic Council Gene Sperling, Treasury Secretary Timothy Geithner, acting director of the Office of Management and Budget Jeffrey Zients and economic adviser Jason Furman, according to those present.
It was notable, then, that the meeting included essentially the entire Obama economic team and wasn’t just a glad-handing event with the president. Members of that team have already echoed what was said on taxes in the meeting—Geithner told reporters at a conference later in the day that “I don’t see how you do this without higher rates. I don’t think there’s any feasible, realistic way to do it.”
Of course it’s not just tax rates the liberal groups are concerned about—deep cuts to the safety net are also in play. But Max Richtman, president of the Committee to Protect Medicare and Social Security and who attended the meeting, said he felt reassured by what he heard.