Editorials
GUEST EDITORIAL
New York Times
Debating the Economy
President Is Finally Engaged
Americans are deeply worried about the economy and their jobs--and about whether their elected representatives in Washington have a real plan for digging out of this mess.
They are right to be worried. But last week, at least, voters were given a clear choice about the direction the country can take in November and beyond.
President Barack Obama--who took too long to engage this debate--gave two sensible and, finally, passionate speeches. He said that to create jobs and stabilize the economy, the federal government will have to help businesses invest more, and it will have to spend some more, for a while longer. And he said that the country will never be able to wrestle down the deficit if Congress gives in to Republican demands to extend $700 billion in unjustified and unaffordable tax breaks for the wealthy.
The speeches were a pointed rebuttal to U.S. Rep. John Boehner (Rep., Ohio), the House Republican leader, who has spearheaded his party’s implacable opposition. In a speech in Ohio last month, billed as the definitive Republican position on the economy, he declared that “the prospect of higher taxes, stricter rules and more regulations” was choking recovery.
The president was exactly right when he said that Mr. Boehner’s proposals were nothing more than a return to the past decade of economic mismanagement; the same policies that helped turn budget surpluses into crippling deficits nearly destroyed the financial system and cast millions of Americans into long-term joblessness.
“Do we return to the same failed policies that ran our economy into the ditch,” he asked last week.
The immediate battle is over President George W. Bush’s tax cuts, which are set to expire at the end of this year. Mr. Obama wants to make the tax cuts permanent for families that make less than $250,000 a year and let the tax cuts expire for those who make more--about 2 percent of taxpayers. Mr. Boehner says he wants to extend all of the tax cuts for two years--although there is little doubt that the goal of Republicans is to extend all of them permanently.
It makes good sense to extend the middle-class tax cuts temporarily because the weak economy needs the boost, but it makes no sense to extend them for the rich. Middle-class Americans spend tax breaks, while wealthy taxpayers, generally, save them. In the longer term, more revenue will be needed to keep rebuilding the economy and meet health care and other obligations.
We’re not surprised that Mr. Obama avoided that hard truth. But Mr. Boehner and his party’s position is an utter denial of reality. In the real world, it was lower taxes for the rich, lax rules and deregulation that hurt middle-class Americans and dragged the economy to this dangerous pass.
Mr. Boehner’s much professed concern for small businesses is misdirection. The tax cuts that Mr. Obama would let expire would affect very few owners of small businesses--how many of them do you know who make more than $250,000 a year?--by any common-sense definition of that term.
Mr. Boehner said he was fed up with “Washington politicians talking about wanting to create jobs as a ploy to get themselves re-elected while doing everything possible to prevent jobs from being created.” Amazingly enough, he was not talking to Republicans.
Mr. Obama did more than just rebut Mr. Boehner. He also offered some sound ideas--some that also had Republican support, at least until Mr. Obama raised them. He proposed last week to allow businesses to write off all the investments they make in 2011, rather than over several years, to close loopholes that reward businesses that send jobs overseas and to permanently extend a research and development tax credit.
Mr. Obama again called on Congress to pass legislation that would make more credit available to small businesses--legislation that Senate Republicans, for all their claims of concern for small businesses, have delayed passing.
If there is any good news from Mr. Boehner and other Republicans it is that they suddenly want to seem eager to shed their reputation as the Party of No. Last week, they suggested that they might be open to some of Mr. Obama’s ideas, which include a $50 billion initial investment to create jobs improving roads, rail lines and airports--as long as those projects were not paid for by taxing billionaires, oil companies and other wealthy corporations. That, of course, is just how Mr. Obama intends to pay for them--and just how he should.
Mr. Obama’s speeches were a robust effort by the president to rally Democrats for the election. It has been a long time coming. And we wish that Democratic leaders in Congress could show the same clear thinking and the same willingness to go head to head with the Republicans. Some commentators are likely to say that Mr. Obama should not have given a national stage to Mr. Boehner, a relative unknown despite his immense power in Congress and his ambition to be the next speaker of the House. But that is just what he needed to do.
For far too long, Mr. Boehner and others have been dominating the political debate with insincere sound bites, Jedi mind games and plain bad economics. How can they claim to care about the deficit and insist on more tax cuts?
The answer, unfortunately, is that they can, and they have, because Mr. Obama has sat on the sidelines and most congressional Democrats have run for the hills. We are glad to see Mr. Obama fully in the fight.
