Here’s the great thing about Obama’s speech to Congress about jobs: it’s never going to happen. Lots of libs are jumping all over this story, detailing Republican reluctance to give Obama a win. Fair enough. I have a Republican-slamming post cooking. But this wailing and gnashing of teeth might be more impressive if Obama himself weren’t scuttling the plan:
The White House said Monday that President Obama wants to pay for his $447 billion jobs bill by raising taxes on the wealthy and businesses.
Jack Lew, director of the Office of Management and Budget (OMB), said the tax hikes would pay for Obama’s entire bill, which the administration is sending to Congress Monday evening.
The chief provision announced by Lew would be to limit itemized deductions for individuals who make more than $200,000 a year and families that make more than $250,000, something the Obama administration has previously pushed to do through its budget proposals. Lew told reporters at the White House press briefing that this would raise about $400 billion.
So much for paying for this out of future spending cuts.
The Republicans will not agree to this and they shouldn’t. This takes money from one group of tax payers and gives it to another. Net economic impact: minimal. And paying for this with deduction phase-outs is mind-boggling. Phase-outs of deductions tend to create cliffs in the income tax — places where the phase-out causes the marginal rate to exceed 100%. Indeed, the phase-out of Obamacare subsidies with income, as I’ve noted, creates marginal rates of up to 174% for low-income people.
Obama knows the GOP will not agree to this. And that’s what bothers me more than anything. If he wanted this passed, a promise to cut future expenditures by tiny percentages would pay for it and possibly win some GOP support. By going the tax route, he’s simply trying to put the inevitable failure of this bill on the GOP.
Given what he knows about the GOP, I find it hard to believe that Obama doesn’t want the bill to pass. And I suspect a big reason is that he’s quite aware that it will be of marginal impact, Mark Zandi’s ridiculously precise and optimistic projections not withstanding. Team Obama knows that our biggest problem — private and public debt — is something we can only work around with time. So while they’re waiting for the nation to work its way out from under the boulder, they might as well throw up a flashy jobs plan and blame the GOP for its failure.
(While we’re on it, it’s worth noting just how much $450 billion is and how inefficient this proposal is. Steve Allen notes that $450 billion is enough to give every unemployed person $32,000 to do volunteer work or an unpaid internship for anyone who will unlock the door. But of course, that wouldn’t line the pockets of government contractors and employees.)
Sigh. Just yesterday, I was having positive thoughts about this President. I was looking back over the last 2+ years and seeing the huge ramp-up in drone attacks that have killed more Al-Qaeda leaders than ever before and thinking this was good foreign policy. Then he lays this political bullshit on us.