Obama's Stealth Tax Cut

Michael Cooper revisited it yesterday in the NYT. Jonathan Bernstein assumes the thinking man position:

[T]his story is a good example of why media bias is so difficult to measure. On the one hand, here’s the (liberal?) New York Times running a story unprompted by events, and just two weeks before Election Day, highlighting a policy which presumably would help Democrats if people knew about it. On the other hand, the fact that such a story could be written -- the fact that most people think Obama has raised taxes when in fact the opposite is true -- is strong evidence against the idea that Americans are influenced by a liberal media.

I think of this as a perfect example of how Obama put good policy before good politics. I notice, however, that he is not going to fall for that again on the debt. Here he is on serious entitlement cuts in the future:

[The debt is] going to require us making tough decisions about things that are important to us. 

And the big debate that we’re going to have to have as a country is what is important enough to us that we’re willing to pay for it and then who pays for it? I think Social Security is important and we have to pay for it. I think Medicare is important and we have to pay for it. 

I think both programs can be more efficient, but I think those provide a core safety net to the American people. I think that our investments in education are absolutely critical to our long-term economic health. 

I think we have to have infrastructure that keeps up with the demands of the 21st century. We can’t have a China that has the best airports, the best railways, the best roads, and we are still relying on infrastructure that was built 200 years ago or 100 years ago or even 50 years ago when it comes to things like broadband lines.

 I’m going to have to make an argument that if we say we revere our veterans, then when our veterans come home, we’ve got to pay for treatment for post-traumatic stress disorder. We’ve got to pay for traumatic brain injury. And we’ve got to care for families who have lost a loved one. And all that stuff costs money.

And when you tally it all up, then it turns out that there’s no such thing as a free lunch.

Notice that this math means huge tax increases to keep Medicare and social security intact. I don't actually believe that's his agenda (or the Debt Commission's likely recommendation), but he's not going to concede spending cuts up front, because of the stimulus lesson. Back then, he conceded the tax cuts and no one noticed them, the GOP pocketed them and then described the stimulus as liberal waste. The GOP will have to fight for entitlement cuts next year - and own them - in a way they did not have to fight for tax cuts in the stimulus. Obama's positioning himself for 2011 already. And in a contest as to who comes off the most reasonable, I don't think the current GOP stands a chance.

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