He's right. Faced with an intransigent GOP and nervous moderate Democrats in the House and Senate, the White House was running out of time to extend the Bush tax cuts, whose expiration would have meant a $1,000 in higher taxes for the average American filer. In fact, the president managed to smuggle into the deal a series of measures -- like 13 months of unemployment benefits, renewed credits for low-income families, and a one-year two-percent payroll tax cut -- that will provide unemployed folks and middle-class families thousands of additional dollars in 2011. It's a second stimulus living inside a Republican tax cut for the rich, or a Republican tax cut for the rich living inside a second stimulus.
CHICAGO -- Three of the nation's premier Democratic mayors -- Richard Daley of Chicago, Michael Nutter of Philadelphia, and Antonio Villaraigosa of Los Angeles -- all announced their support for President Obama's tax cut compromise in a conference in Chicago on the future of the city held by the Brookings Institution.
"G.T.D.," Nutter told panel host Richard Stengel, the editor of Time magazine. "That means getting things done." That's what the tax deal is all about, he continued. Villaraigosa agreed, saying the president's compromise mirrored the kind of hard pragmatic decisions they have to make every day while closing historic budget deficits. Even Daley, who harshly criticized Washington's debt addiction earlier, said that deal was necessary and acceptable as a matter of helping average Americans and moving the country forward.
The real loser here is not Democrats, not Republicans, and certainly not average Americans. The loser is the debt. Thousands of dollars in the hands of average Americans means hundreds of billions of dollars out of the coffers of the federal government. This plan will cost between $800 billion and $900 billion over the next two years, more than the original stimulus compared to current law. There is still no credible plan to pay it off.
What's a progressive deficit hawk to think? I justify the deal to myself this way. This compromise makes the debt a crisis like winter makes Antarctica cold. The debt was already a looming disaster in the medium and long term, one that requires bold, wide-ranging and painful tax increases and spending cuts -- but not yet. Just as the Bipartisan Policy Center's deficit plan begins with a $650 billion payroll tax cut and ends with higher effective tax rates and Social Security reform, so should the Obama administration use this compromise as a fulcrum to seek tax reform and deficit reduction through his second term.
To get a second term, he needs to win reelection. To win reelection, he has to get the economy moving. To get the economy moving, he had to make a deal. This deal is not perfect, not even close. But politics isn't about seeking perfection to the exclusion of all action. Politics, as the nation's leading mayors reminded us, is about getting things done.