Tax Cut Deal

truth-out.org — The stage is set and the main actors in Congress and in the corporate establishment are ready to perform after rehearsing behind closed doors for the coming assault on organized labor's most powerful sector: public workers. Public workers are being targeted because they are the strongest sector of the national labor movement and their strength is incompatible with the agenda of the political-corporate establishment: making working people pay for the bank bailouts and two foreign wars. Public workers cannot be spectators in this unfolding drama. They must learn to act collectively. Unions must educate their membership about the gravity of the coming assault. Anti-union attacks must be resisted while alternatives are proposed; state funding must be increased by raising taxes on the rich and the corporations. If public employee unions are busted, the rest of the labor movement will be targeted next — but it will be too weak to defend itself.

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huffingtonpost.com — Don't look now, but Congress just raised your taxes. How can that be? Didn't they just approve a bill that will keep Bush-era tax cuts in place, lower the inheritance tax, and lower the Social Security tax for a year? Call it the "debt tax." Whenever the federal government enacts a bill that it does not pay for, we go further into debt — in this case $900 billion. When you buy something you can't afford, you borrow the money and pay interest on what you borrow. The interest the government has to pay on its debt has to come from you, the taxpayer, and thus it acts just like a tax — your tax dollars pay it.

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robertreich.org — Over the long term, the only way we’re going to raise wages, grow the economy, and improve American competitiveness is by investing in our people — especially their educations. But considering the increases in our population of young people and their educational needs, and the challenges posed by the new global economy, more resources are surely needed. Here’s another reason why the $858 billion tax bill — including a continuation of the Bush tax cuts to the richest Americans and a dramatic drop in their estate taxes — is so dangerous. By further widening the federal budget deficit, it invites even more budget cuts in education, including early-childhood and post-secondary. Pell Grants that allow young people from poor families to attend college are already on the chopping block.

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guardian.co.uk — The enthusiasm of the U.S. business press for the compromise tax package worked out by President Obama and Republicans in Congress led to a mini-euphoria of upbeat economic projections for 2011. While the economy will do better with this tax package than if no deal were forthcoming, much of the discussion has exaggerated the potential stimulus to the economy. There is every reason to expect that 2011 will be another year of weak growth, with little, if any, decline in the unemployment rate. The economy will be somewhat stronger as a result of this tax package being put in place, compared to a scenario in which nothing was done, but this is very far from the fabled "second stimulus" that some are acclaiming.

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huffingtonpost.com — It is astonishing how the Beltway echo-chamber, most egregiously the editorial page and news columns of the Washington Post (hard to tell the difference), thinks this deal is good for the Republic. The Post has become a cheerleader for policies that fail to cure the economy and show off Obama as a weakling waiting to be rolled again. The tax deal, re-branded as a stimulus program, is paltry and ineffective as economic tonic. What hardly anyone seems to have grasped is that the deal basically continues the status quo with almost no stimulus.

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