We realize we are advising Democrats here, and so a permanent extension may be a tax bridge too far. But even a two-year extension would be better than letting taxes go up. The struggling recovery would avoid a huge near-term hit to individual and business income, which means more money for private investment and job creation.
As for the politics, this isn’t a close call. By extending the tax rates, Democrats can help the economy while denying Republicans one of their best issues. Voters still wary of the GOP might also give Democrats credit for finally listening to them and changing their minds. The left would squawk, but the left will lose more if Democrats lose the House or Senate.
The only reason to oppose our Democratic self-rescue plan is the grip of ideology. We recall the Democratic Presidential debate when ABC’s Charlie Gibson famously asked candidate Barack Obama why he favored higher capital gains tax rates when the evidence is that lower rates produce more tax revenue. After some back and forth, Mr. Obama’s one word reply came down to “fairness.” If you really believe the main job of government is to redistribute income and punish the rich for making too much money, then you don’t mind raising taxes even if it costs you control of Congress.