Dangerous New Deals

Some powerful Democrats have been trying to claim lately that are donning the austerity mantle just to prove to the country how insane and intractable the Republicans are in comparison. They won't admit that they themselves have veered right in order to please their Wall Street paymasters, and to keep that campaign cash flowing. They are pretending we are in a debt and deficit crisis and that a strict diet of safety net slashes coupled with a smidgen of new revenue will magically put some fat on the GDP.

They are buying into the tripe pushed by centrist think tanks run by corporations and talk show pundits owned by corporations. They insist that the failed Bowles-Simpson Catfood Commission is still alive and well and beloved by all the world. Many of them have become full-fledged members of the cult whose prime tenet is that the government is just like a family, that fairness is defined as impoverished grannies giving up one daily meal at the same time Jamie Dimon surrenders the tax deduction on his 10th vacation home.

Latest case in point: House Minority Leader Nancy Pelosi has just approached Speaker John Boehner about immediately and permanently extending the Bush tax cuts to people earning less than $1 million a year, rather than the $250,000 championed by the Obama Administration. This idea is nothing new. In fact, N.Y. Senator Chuck Schumer (D-Wall Street) has been proposing the million dollar figure since forever. The sad fact, claims Chuck, is that $999,000 is just chump change when you live in New York or its wealthy 'burbs. Private school tuition is skyrocketing, property taxes on multimillion dollar mansions are out of control, and with the slight chance that the state minimum wage is going up to $8.50 an hour, the cost of The Help will go through the roof.

Chuck claimed in 2010 that the million-dollar compromise would show those nasty Republicans just how nasty they are. He predicted that his offer would make it impossible for them to say No. Guess what? They said No then, and they'll say No again. Chuck and Nancy just don't want to admit that their party's prime allegiance is to rich people, too. They have to pretend to be a bit more populist.  

Never mind that extending the tax cuts to almost-millionaires will seriously
bloat the deficit. The public interest group Citizens for Tax Justice estimates that in 2013 alone, the Pelosi-Schumer plan would cost between $60 and $70 billion. As a matter of fact, their plan would actually be more beneficial to the really, truly, filthy rich than to the merely rich: a full 50% of their tax cuts would go straight to millionaires:

This would result because under Pelosi’s proposal, a married couple making $3 million a year, for example, would continue to pay the lower tax rates (enacted under President Bush) on $1 million of their income. Under Obama’s proposal, a married couple making $3 million a year would continue to pay the lower tax rates on just $250,000 of their income.

Taxpayers with incomes exceeding $1 million would therefore receive substantially larger tax cuts under Pelosi’s proposal than they would under Obama’s proposal.

The Huffington Post quoted an anonymous Democratic aide whose name could not possibly be Nancy Pelosi as saying Nancy Pelosi's whole point is just to make the Republicans look bad by displaying how reasonable and serious she herself is:

If Republicans refuse to move on this proposal, it is clear they are standing with millionaires and endangering the economic security of the middle class," said the aide.

(snip) 

"What Pelosi is proposing is a reasonable path forward given this situation," said the aide.

Pelosi made other waves recently by signalling she would also be open to a "Grand Bargain" of social safety net cuts, leading former Wisconsin Senator Russ Feingold to circulate a petition against the plan. Again, she had defended herself by claiming that her aim was simply to make the nihilistic GOP look unreasonable to voters in this election year. Same game of chicken, in which she puts impoverished surrogates (real people) behind her political daredevil wheel.

Either Nancy Pelosi is trying to out-Obama Obama in the Negotiating With Oneself department, or she is getting old and befuddled, or she is giving needed cover for Obama to "cave" in an election year/lameduck session, or she has been a corrupt phony all along and it's just beginning to dawn on people. If I had to cast a vote today, I would opt for all of the above.

As the sixth wealthiest member of the House with a reported net worth of almost a quarter-billion dollars, Pelosi ranks right up there with Mitt Romney in the riches department. Maybe her California constituents should consider throwing her a retirement party, sooner rather than later.