Same Old Tax Fight

Obama and Republicans have clashed over wealthy Americans twice already. Both times, the public sided with the president. Has anything changed?

"It follows a balanced approach: asking everyone to do their part, so no one has to bear all the burden. And it says that everyone -- including millionaires and billionaires -- has to pay their fair share," President Obama said Monday in the Rose Garden, offering up his latest deficit plan.

Obama laid out virtually the same argument he made in just two months ago, the last time he suggested raising taxes on the wealthiest Americans, when Washington nearly let America default on its debt: that deficit-reduction is about a "balanced approach," one that must include both tax increases and spending cuts.

This same fight has played out twice already in the last nine months. Both times, the public has sided with Obama. And both times, Republicans have gotten their way.

In December, as Congress's holiday recess drew near, Obama and Republicans entered a standoff over the future of the Bush tax cuts. Obama proposed letting them expire for Americans who make over $250,000 per year; Republicans insisted that taxes shouldn't rise at all, given America's economic state.

Republicans "believe that we should also make permanent the tax cuts for the wealthiest 2 percent of Americans. I completely disagree with this. A permanent extension of these tax cuts would cost us $700 billion at a time when we need to start focusing on bringing down our deficit. And economists from all across the political spectrum agree that giving tax cuts to millionaires and billionaires does very little to actually grow our economy," Obama said on Dec. 6, as the debate was ramping up.

In the end, Obama and Republicans compromised. Obama signed a two-year extension of all the tax cuts; Republicans approved an unemployment-insurance extension and a nuclear arms treaty with Russia.

What did the public think of all this?

On the tax cuts, poll respondents sided clearly with Obama. While the public widely supported lower-income tax cuts and, by extension, the whole tax-cut compromise, a Dec. 17-19 CNN poll found that 62 percent opposed the higher-income tax cuts and 37 percent supported them.

Over the summer, Obama and House Speaker John Boehner resumed their tax loggerheads, as the national default deadline of Aug. 2 approached. Boehner and Republicans demanded a serious plan to reduce the deficit. Obama's solution: spending cuts accompanied by taxes on the rich.

"If we choose to keep those tax breaks for millionaires and billionaires, if we choose to keep a tax break for corporate jet owners, if we choose to keep tax breaks for oil and gas companies that are making hundreds of billions of dollars, then that means we've got to cut some kids off from getting a college scholarship," Obama said during a press conference on Jone 29. "That means we've got to stop funding certain grants for medical research. That means that food safety may be compromised. That means that Medicare has to bear a greater part of the burden. Those are the choices we have to make."

Once again, the public took Obama's side, preferring to tax the rich before making deeper entitlement cuts like the near-voucherization of Medicare offered up by Rep. Paul Ryan (R-Wis.). The public disliked taxes in general, polls found, suggesting Boehner and Republicans were on the right track. But on the specifics of upper-income taxes, Obama had public sentiment on his side.

After Obama and Republicans reached a deal, poll respondents said they would rather have followed the president's plan. In an Aug. 4-7 USA Today/Gallup poll, 66 percent favored raising taxes on higher incomes. Respondents opposed cuts to defense spending and entitlement programs. In an Aug. 5-7 CNN poll, 62 percent said taxes on wealthy people should be kept high so government can use the revenue to help people with lower incomes, while 34 percent sided with the GOP argument that taxes on wealthy people should be kept low because their spending and investment helps create jobs.

In the latest round of the deficit fight, not much has changed.

Congress's newly created "supercommittee" must find at least $1.5 trillion in 10-year deficit reduction by Nov. 23, otherwise $1.2 trillion in cuts will be triggered. Last week, Boehner insisted the supercommittee must not include any tax hikes in its plan -- just like he has since December.

The public has agreed with Obama's tax-the-rich plan all along, but at the same time his popularity has eroded. On Dec. 17, the day he announced the deal to extend the Bush tax cuts, Gallup listed Obama's approval rating as 46 percent, with 45 percent disapproving. On Aug. 2, the day he signed the debt-limit deal, Gallup showed 43 percent approval and 48 percent disapproval. Today, 40 percent approve, while 52 percent disapprove.

As we enter the third round of this same argument, Obama finds himself in a weaker general position after repeatedly winning the argument and losing the policy fight.

Image credit: Evan Vucci/AP