GOP needs to shed image of ‘party of the rich’
BY STEVE HUNTLEY firstname.lastname@example.org December 3, 2012 5:54PM
President Barack Obama waves Friday, in Hatfield, Pa., after speaking at the Rodon Group, which manufactures over 95 percent of the parts for K'NEX Brands toys. The visit came as the White House continued a week of public outreach efforts, while also atte
Updated: January 5, 2013 6:14AM
Congressional Republicans are stuck between a rock and a hard place: Their instincts on taxes are right as economic policy but wrong politically. The top political priority for the GOP must be throwing off the mantle of “the party of the rich.” That means giving President Barack Obama the unpalatable victory of raising tax rates on top-income earners.
Obama didn’t just win re-election, the Democrats picked up seats in both the Senate and the House. Republicans may have kept their House majority, but adding up all the votes cast in congressional races shows Democratic candidates overall got about a million more votes. Only five times in the last 100 years has a party won a majority of seats in the House with a minority of votes, according to the New Yorker.
Obama campaigned offering virtually only one policy prescription for his second term: Raise tax rates on the wealthy.
Republicans can complain all they want that Obama and Democrats divided America along class lines, but the ugly truth is that ugly tactic has worked. Exit polling showed that voters thought GOP nominee Mitt Romney would back policies that favored the rich over the middle class. Conservatives can rightly argue that Romney failed to articulate how free markets create wealth and opportunity for everyone, but that doesn’t change today’s political realities.
Polling indicates that failure to resolve the “fiscal cliff” issues resulting in tax increases for everyone and new economic distress for the country will be blamed on Republicans. A new Rasmussen Reports poll shows voters think Obama is more willing to deal on the fiscal cliff issues. The GOP is losing the political messaging battle — big time.
Yes, raising taxes in a weak economy is a bad idea. Yes, raising taxes on small business and the investing class is a bad idea. But it’s the idea a majority of voters endorsed Nov. 6.
House Speaker John Boehner responded by putting increased revenues on the table through limiting tax deductions for the top 2 percent of Americans. But Obama made it clear, there must be a hike in rates. He’s upped the ante by demanding $1.6 trillion in new revenues — twice what he campaigned on — and billions in new stimulus spending. It was typical of Obama — repeating the mistake of his first year in office of rubbing the GOP’s nose in its ballot box losses, further poisoning the divisive politics of Washington.
Boehner and House Republicans should pass a bill giving Obama the $800 billion he campaigned for and do it through a combination of deduction limits and a rate hike. The rate increase won’t be as much as Obama wanted, but the bill would give him the revenues he sought and be a compromise. The onus will be on Obama to accept compromise or drive the nation off the fiscal cliff.
Boehner offered Monday to raise the $800 billion using loophole closings only. Obama won’t accept that because it violates his one campaign position. The longer it takes to get to a deal, the more firmly the image of the GOP as the defender of the rich is locked in the public’s mind.
A quick resolution would clear the decks for the more important battles over tax and entitlement reform. A new tax code enacted next year lowering rates and closing loopholes would rectify this year’s tax hike.
Some argue giving Obama his tax increase now robs the GOP of leverage over spending cuts and entitlement reform. But the debt ceiling must be raised in 2013. That’s a powerful inflection point for Republicans to press their case on Obama’s $1 trillion deficits, the $16 trillion national debt and the unsustainable entitlements that imperil the nation’s future with a tsunami of red ink. But to do that, Republicans must get the political monkey “party of the rich” off their backs.