Surprise! Obama floats new tax cut trial balloon

posted at 11:31 am on October 27, 2012 by Ed Morrissey

As I noted in my earlier column for The Fiscal Times, we’ve now gone more than 570 days into the Barack Obama Re-Election Campaign.  On Day 568, Obama finally deigned to produce a second-term agenda — a document so unserious and insubstantial that its release served to underscore his desperation rather than enlighten anyone on his approach to the next four years.  Even the media scoffed at the collection of recycled 2008 campaign promises and the utter lack of detail on his sloganeering.

Clearly, that didn’t do anything to revive Obama’s chances on the campaign trail, especially not with Mitt Romney hammering home his closing argument on jobs and the economy.  Therefore, on Day 574 — and late in the evening on a Friday — Obama finally got around to floating a tax-cut trial balloon:

The White House is weighing the idea of a tax cut that it believes would lift Americans’ take-home pay and boost a still-struggling economy, according to people familiar with the administration’s thinking, as the presidential candidates continue battling over whose tax policies would do more for the country.

Obama administration officials have concluded that the economy, while improved, is still fragile enough that it may need another bout of stimulus. The tax cut would replace the payroll tax cut championed by President Obama in 2011 and 2012, which was designed as a buffer against economic shocks such as the financial crisis in Europe and high oil prices. It expires at year’s end.

The new tax cut could provide hundreds of dollars or more a year to workers and show up in every paycheck. It may be similar to a tax cut Americans received in 2009 and 2010, which provided up to $400 for individuals and $800 for married couples, sources close to the administration said.

When I wrote on Thursday that Obama was out of gas intellectually and politically, I had no idea that he would prove me right again so soon.  This is nothing more than the gimmicky approach that has utterly failed already under Obama — twice.  This is a regurgitation of the Making Work Pay tax cut, passed in 2009, which was supposed to touch off a boom in consumer spending by allowing people to keep roughly $20 a week more from their paychecks.  It’s also the same kind of approach as the payroll-tax holiday passed at the beginning of 2011, which was also supposed to boost consumer spending and kick-start the economy into high gear, and which has failed equally.  (And let’s not forget that George Bush tried the same kind of “tax cut” stimulus in early 2008, with exactly the same amount of success.)

Clearly, giving consumers an extra $20 a week isn’t going to restart the engine of job creation in this economy — something that should be obvious by now.  The problem in this economy isn’t that consumers aren’t spending, it’s that investors aren’t investing.  One of the key reasons investors won’t put capital at risk is because of their inability to price that risk with any certainty, thanks to the short-term, gimmicky approach to taxes combined with the long-term and still ambiguous costs of Obama’s regulatory expansion. Instead of offering a third round of Cash For Consumers (fourth if you count Bush), the US needs long-term tax and regulatory reform so investors can once again rationally price risk for a 2-3 year period.

This is nothing more than an act of desperation, a trial balloon that attempts to sponge off of Romney’s media attention to the economy and jobs.  And as Morrissey’s Axiom of Politics and Dating states, desperation is not an aphrodisiac.


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Tim_CA on October 27, 2012 at 12:50 PM

That 20 bucks will buy you a box of Federal 357B.
It’s not just a tax cut- it’s Barammo.

justltl on October 27, 2012 at 12:59 PM

O/T Did anyone see where Fauxahontas had pulled ahead by six in MA. What they heck?

Cindy Munford on October 27, 2012 at 12:54 PM

Because the hyper-partisan democratic voters do not want to lose control of the US senate in case of a Romney win.

bayview on October 27, 2012 at 1:00 PM

As I noted in my earlier column for The Fiscal Times, we’ve now gone more than 570 days into the Barack Obama Re-Election Campaign.

I’m pretty sure this is a typo, Ed. The Obama reelection campaign began January 20, 2009.

sadarj on October 27, 2012 at 1:03 PM

Gallup today

Romney 51 Barry 46 Romney +5

with 10 days to go.

bayview on October 27, 2012 at 1:04 PM

He bought the 2008 election with similar offer. Think it was proposed as 500/1000 and was reduced in reality to 400/800. Now he wants to buy votes in this election the same way.

The problem for us is that this method works. He knows the American people can be bought. Just returning to what he knows.

ObamaBucks!

Carnac on October 27, 2012 at 1:07 PM

“THIS ELECTION…IS LOST…”
~Dingy Reid

Strike Hornet on October 27, 2012 at 1:09 PM

O/T Did anyone see where Fauxahontas had pulled ahead by six in MA. What they heck?

Cindy Munford on October 27, 2012 at 12:54 PM

I noticed Rasmussen has her at 52% in his latest poll of the race.

NotCoach on October 27, 2012 at 12:57

It’s very disappointing. Voters in MA are gullible.

ghostwriter on October 27, 2012 at 1:12 PM

Gallup Today:

Romney: 51

Obama: 46

Romney +5

Obama approval: 46 (-2)

Obama disapproval: 49 (+2)

There’s a term for Presidents with approval ratings at 46%: “Former Presidents.”

NumbersMuncher ‏@NumbersMuncher

That’s 12 days in a row that Romney has been at/above 50% in Gallup. He’s hit 50% for 5 days on Rasmussen. O hasnt been above 47% in either.

NumbersMuncher ‏@NumbersMuncher

Gallup Saturday: Romney up 5 among LVs, 51-46. Obama approval now underwater 46-49 among ALL adults. Tied up at 48 among RVs.

NumbersMuncher ‏@NumbersMuncher

Gallup approval is among ALL adults.AP/GfK poll had -7 net from adults to LVs. That would mean Obama would be something like 43-53 among LVs

Resist We Much on October 27, 2012 at 1:17 PM

bayview on October 27, 2012 at 1:00 PM

I guess that makes sense, it just seems a shame that it’s her.

Cindy Munford on October 27, 2012 at 1:24 PM

Yahoo has a headline about a poll that indicates a “disappointing trend in racial views.” Sounds like they’re setting up to push their post-defeat narrative.

86 on October 27, 2012 at 1:30 PM

..why, this $20 from the Crapsack POTUS™ won’t even cover the gas costs for driving all the Somalians to the polls in OIHO.

The War Planner on October 27, 2012 at 1:32 PM

How will we “pay for” these tax cuts Senator Government?

tom daschle concerned on October 27, 2012 at 1:39 PM

and the lsm and the dems will think this is awesome and the gop are just obstructionist…oh yeah

cmsinaz on October 27, 2012 at 1:42 PM

Ah, it’s the “Where’s yo dolla?”: Campaign desperation mode

1984 in real life on October 27, 2012 at 1:43 PM

Surprise! Guess how the price of gasoline will fall to the bottom in the swing States. Voters memories are very short. Ohio is already lowered their gas prices but wait till January when they get hit with the new taxes and blame it on Bush.

mixplix on October 27, 2012 at 1:54 PM

Gee whiz, doesn’t our President have cue sized balls

SmallGovtGuy on October 27, 2012 at 12:51 PM

Why yes! I hear they are about the size and shape of a 12pt “q.”

Chewy the Lab on October 27, 2012 at 1:58 PM

mixplix on October 27, 2012 at 1:54 PM

in Wisconsin gas prices are down 35 cents in the past week (still high though at 3.49 around here). mind games…

teejk on October 27, 2012 at 2:16 PM

OT, but just found this super video, appealing to Obama or undecided voters.
It’s 7 min, but the second half is inspiring.

http://www.ijreview.com/2012/10/20206-must-watch-video/

pambi on October 27, 2012 at 2:50 PM

He bought the 2008 election with similar offer.

Carnac on October 27, 2012 at 1:07 PM

He didn’t even win the Dem primaries, Shillary and then got shoved aside by the Dem Party. And I am sure he’d loose this year as well had anyone challenged him.

riddick on October 27, 2012 at 2:52 PM

It may be desperation but it’s real. O has no clue of basic debits and credits, period. The lack of awareness of what REAL people go through is just mind-boggling.

Unfortunately, the low informed voters will buy it. If Romney does not win the presidency, these low-info voters MAY wake up but it may be too late.

Frightening.

MN J on October 27, 2012 at 4:01 PM

Reuters now reporting that the WH is denying this.

wargamer6 on October 27, 2012 at 4:48 PM

A few past fellas have heard when I broke off with them,

“Too little, too late. Adios mother fka”.

Typicalwhitewoman on October 27, 2012 at 6:31 PM

The new tax cut could provide hundreds of dollars or more a year to workers and show up in every paycheck. It may be similar to a tax cut Americans received in 2009 and 2010, which provided up to $400 for individuals and $800 for married couples, sources close to the administration said.

Tax credits are not tax cuts, they are spending through the tax code.

Count to 10 on October 27, 2012 at 8:28 PM

President Taxmageddon reassures the people of America that none of this is really happening. It’s just a bad dream.

minnesoter on October 27, 2012 at 11:41 PM

Predictive Markets Saturday Update:

Obama increases to a 2.25:1 favorite:

Wed: 2.0:1
Thur: 2.1:1
Fri: 2.15:1
Sat: 2.25:1

The odds of an Obama victory increased for the fourth day in a row. The electoral college tells the story. Obama has two pathways to a second term:

Path #1: Obama wins Ohio
Path #2: Obama wins Wis, Iowa, Nev, Colorado, & NH

Overnight, Obama’s odds have strengthened in Ohio, and Colorado has flipped from lean Romney to lean Obama. Obama is now favored in all path #2 states. Virginia odds flipped overnight from Romney favored to even. Path #2 will be re-evaluated if Virginia stays in play.

Think for yourselves and do your own research..

http://linemakers.sportingnews.com/sport/2012-10-23/presidential-election-odds-2012-barack-obama-mitt-romney-debate-white-house

http://www.oddschecker.com/specials/politics-and-election/us-presidential-election/winner

ZippyZ on October 27, 2012 at 11:42 PM

ZippyZ on October 27, 2012 at 11:42 PM

Pal, you are getting as desperate as Obama…if that’s possible.

Co. is leaning Mitt, Fl, Wi, Mi, Pa, Va, Nc, Ia, Oh is dead even…you can pick and choose your polls, there are hundreds…but all the majors have Romney ahead in those states.

The important thing, is that they are using more dems than Repbulicans in the polls, mimicking 2008 election, and that ain’t going to happen.

Here is a little poll for you, for decades the path to victory was through the independents, up to 6 months ago, the dems still swore by that, and indeed, history supported it.

The country is evenly divided, so it makes sense, the “indpendents” end up as the tie breaker…right now Romney is leading that demo by double digits…figure that out. All the polls show him carrying the independents…so what has changed? All of a sudden the independents don’t matter?

It’s all over, by 9 pm EST, the race will be over, and called for Mitt…he will garner close to 300 electoral votes, and few will be contested it will be a blow out…dems won’t show up, Republican’s and independents will…adios Obama…

right2bright on October 28, 2012 at 3:06 AM

ZippyZ on October 27, 2012 at 11:42 PM

And to add…I don’t think you understand how odds are created…

right2bright on October 28, 2012 at 3:10 AM

Don’t discount the Zombie Vote in Ohio. It always works in Chicago. Shades of the Black Death, I can see the White House frantically otdering to “Bring out your dead!”

Uniblogger on October 28, 2012 at 7:18 AM

One of the key reasons investors won’t put capital at risk is because of their inability to price that risk with any certainty, thanks to the short-term, gimmicky approach to taxes combined with the long-term and still ambiguous costs of Obama’s regulatory expansion.

This is a neat encapsulation of what business has been faced with for the last 4 years.

Strategic planning in business tends to look 3-5 years ahead. NA businesses and investors gave up that approach long ago because we literally have no idea what is coming down the chute next month. Ironically, strategic planning is far easier for EMEA and ASIA-PAC despite all the turmoil there. The media does not highlight this.

If this carries on it will not end well.

CorporatePiggy on October 28, 2012 at 9:27 AM

how does one cut taxes for people that don’t pay taxes?? they give them money.

RonK on October 28, 2012 at 10:10 AM

The trolls are out in full force this morning. Not even sure what their objective is. Only thing they’re doing is ensuring that every single Republican on this site (and who reads this site) votes.

MrX on October 28, 2012 at 11:31 AM

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