Democrats are toying with recession

“If we can’t get a good deal—a balanced deal that calls on the wealthy to pay their fair share—then I will absolutely continue this debate into 2013 rather than lock in a long-term deal this year that throws middle-class families under the bus,” Mrs. Murray said, in what sounded like an ultimatum.

That bit about throwing middle-class taxpayers “under the bus” is political spin, because Republicans say they’re ready to vote to extend for another year the current tax rates on all taxpayers, including everyone who makes less than $250,000. The Murray Democrats are the ones holding the middle-class rates hostage to a GOP vote to raise taxes on the affluent. …

Mrs. Murray may think she’s putting Republicans on the political spot, but her real hostage is the already weak economy. Growth in the first quarter was a mere 1.9%, and economists have steadily downgraded their expectations for the second. As the tax cliff approaches, the policy uncertainty is already causing businesses to hold off on hiring and investment. Even the Keynesians at the Congressional Budget Office say that if all of the Bush tax rates expire, growth will fall close to recession territory.