# Obama {deals | caves} on tax cut extensions **URL:** \ **Category:** Great Debates\ **Created:** [December 7, 2010, 1:56pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266 "2010-12-07T13:56:12Z")\ **Posts on this page:** 20\ **Page:** 5
**Author:** ![Lobohan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobohan/32/79_2.png) [@Lobohan](https://boards.straightdope.com/u/Lobohan)\ **Post date:** [December 7, 2010, 7:52pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/81 "2010-12-07T19:52:41Z")
> [@flickster](#): > > Glad you have undying faith in our political class. Myself, I have a hard time trusting the snake oil salesman when he is telling you how good his snake oil is. For that matter, no different in GW telling us how good the TARP plan was… You seriously need to look up what the CBO is. Why is cited evidence not good enough for you? ---
**Author:** ![Onomatopoeia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/onomatopoeia/32/4145_2.png) [@Onomatopoeia](https://boards.straightdope.com/u/Onomatopoeia)\ **Post date:** [December 7, 2010, 7:56pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/82 "2010-12-07T19:56:26Z")
> [@pseudotriton\_ruber\_ruber](#): > > I think he did it so that no Republican ever can label him a socialist again. Now that he’s cut a deal that includes tax cuts for the wealthiest 2%, the Republicans will have to offer him a contrite apology for mis-characterizing him the past two years and a vow to defend him against any future charges by demogogues that his program is a socialist one. HAhahahahahaha!!! Thanks **PT**. I needed that laugh today. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [December 7, 2010, 8:18pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/83 "2010-12-07T20:18:20Z")
I think Obama made a mistake. First, he already has a reputation for giving in to his political opponents too readily - this will reinforce it. Second, the tax cuts were a bad idea - and Obama will end up being the one who takes the heat for the deficit. It was a straight win for the Republicans. They got the tax cuts they want for their constituency; Obama will pay the price for it; they end up looking strong; Obama looks weak; and the Republicans can even claim whatever credit they can derive from having backed the unemployment extension. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 7, 2010, 8:21pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/84 "2010-12-07T20:21:11Z")
> [@Fotheringay-Phipps](#): > > Rich people don’t “create jobs” by investing. They create them (to the extent that they do) by buying a lot of expensive things, which create opportunities for middle class people to make money supplying and for working class people to get jobs creating. > > I don’t know about how the multiplyers work and all that, but it’s a mistake to focus on investing in this context. Nonsense. The personal spending of the middle class far exceeds that of the rich. The wealthy invest the majority of their money in the lowest risk acquisitions. And those will have the lowest rates of hiring, or be in another country. Capitalism and Free Enterprise are based on a competitive market, where risk is required in order to profit. We stopped practising that long ago. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 7, 2010, 8:22pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/85 "2010-12-07T20:22:08Z")
> [@Bricker](#): > > One comment I heard hinted at a couple of times from the talking heads at CNN and MSNBC, respectively, and outright said by Dan Rather, who was being interviewed by one network, was: “By this capitulation, Obama has guaranteed himself a strong primary challenger in 2012.” > > I don’t see it. But I’ve been wrong before. I’d vote for Hilary this time. Perhaps i should have voted for her last time. I’ll be the first to say it… I was wrong about Obama. He’s not the transformative president we were looking for, the one who was going to change the course of the nation. Next time I’m going to vote for the candidate with bigger balls. HILLARY '12!!! ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 7, 2010, 8:29pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/86 "2010-12-07T20:29:22Z")
> [@Lobohan](#): > > I don’t suppose you have a cite from mainstream economists that show a general consensus about that point? He didn’t claim the research was any good. He just claimed it was recent. George Mason university constantly pumps out economics research papers that seem to be reversed engineered from the conclusion “tax cuts= teh win” There is a relatively prolific Aurtalian University that does much teh same thing. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 7, 2010, 8:31pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/87 "2010-12-07T20:31:27Z")
> [@gonzomax](#): > > The unemployed spend the money they get surviving. That spending causes demand for products, which does help the economy. It has a multiplier effect. > The tax cuts for the rich have been going on for a long time. As the rich get more and more , unemployment has soared. It is clear tax cuts to the wealthy do not result in job growth. But money = power. The power of the rich has soared. That is what this is about. The concentration of power and wealth in the hands of the few. They are in a position to grasp more power and are determined to do so. > Obama is selling out. It is short term thinking. A couple million people losing unemployment would be terrible for them. It would be good to help them. Letting them go broke would be bad for America. It would make us look cruel and uncaring. > But the deficits have to stop growing. Letting the entire Bush tax bill expire would drop the deficits about 25 percent. That is a great first step. Cutting taxes for the rich will generally cause more investing but with interest rates at historical lows we are not in danger of underinvestment right now. ---
**Author:** ![Fotheringay-Phipps](https://avatars.discourse-cdn.com/v4/letter/f/d9b06d/32.png) [@Fotheringay-Phipps](https://boards.straightdope.com/u/Fotheringay-Phipps)\ **Post date:** [December 7, 2010, 8:34pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/88 "2010-12-07T20:34:29Z")
> [@TriPolar](#): > > Nonsense. The personal spending of the middle class far exceeds that of the rich. The wealthy invest the majority of their money in the lowest risk acquisitions. A \< B is not equivalent to A = 0. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 7, 2010, 8:40pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/89 "2010-12-07T20:40:14Z")
> [@Fotheringay-Phipps](#): > > A \< B is not equivalent to A = 0. Thanks for pointing that out. I’m very bad at math and might have missed it. I might even have been foolish anough to believe that A != 0 means A is equivalent to B. ---
**Author:** ![Fotheringay-Phipps](https://avatars.discourse-cdn.com/v4/letter/f/d9b06d/32.png) [@Fotheringay-Phipps](https://boards.straightdope.com/u/Fotheringay-Phipps)\ **Post date:** [December 7, 2010, 8:41pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/90 "2010-12-07T20:41:50Z")
> [@TriPolar](#): > > Thanks for pointing that out. I’m very bad at math and might have missed it. In fact, it appears that you did. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 7, 2010, 8:45pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/91 "2010-12-07T20:45:50Z")
> [@elucidator](#): > > Last night, if you listened, you heard hundreds of thousands of American families breathing a sigh of relief because this Christmas they won’t be destitute. I don’t mean strapped, I don’t mean cutting down on restaurants and movies, I mean fucking broke! Zero, zip, zilch, nada. If these aren’t our people, who’s people are they? Welcome to Hooverville. > > Well, we can blame the Republicans! Huge political victory, propaganda wise, sacrifice some people to advance our cause. That’s Leninism, hooray for oppression that brings the Revolution closer. I despise Leninism, I despise immoral politics. “Sorry your kids go without shoes this Christmas, but we were really, really sure they would cave! Nasty break, sorry about that, vote for us, because we care!” OK I hear you. but we can’t save everyone and we are putting ourselves in a worse position to be able to save ANYONE going forward. > [@](#): > > Said it before, allow me to be repetitious and redundant: sometimes, to do the right thing, you have to be willing to eat some shit. All right, goddamit! Here’s my spoon, here’s my grin… OK, so maybe its selfish of me to insist on my principles when the unemployed family looking at week 99 of unemployment is the one that will be at the soup kitchen on Christmas this year while I buy a new 60" 3D television set but do we stand on principle at any point or do we keep caving to republilcan demands as long as they give us some crumb that the country needs? ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [December 7, 2010, 8:54pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/92 "2010-12-07T20:54:35Z")
> [@Damuri\_Ajashi](#): > > I’d vote for Hilary this time. Perhaps i should have voted for her last time. > > I’ll be the first to say it… I was wrong about Obama. He’s not the transformative president we were looking for, the one who was going to change the course of the nation. Next time I’m going to vote for the candidate with bigger balls. HILLARY '12!!! That’s the way I see it. Obama’s like Carter - a nice guy but he lacks the killer instinct he needs for the job of being President. To be effective, people have to be a little bit afraid of you. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [December 7, 2010, 9:00pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/93 "2010-12-07T21:00:01Z")
> [@Fotheringay-Phipps](#): > > In fact, it appears that you did. I guess you aren’t picking it up. A, the personal spending of the rich, is less than B, the personal spending of everyone else. Increased income for the rich does not automatically go to personal spending. They are already rich, and spend as much as they want. Everybody else will spend almost all of any increase in income. I’m not in favor of increasing anybody’s income, except for people who are out of work. I’m not in favor of maintaining the inefficient unemployment insurance system we have either. I’m in favor of everybody in this country contributing more to lower our debt, and provide incentives for creating jobs. Rich, poor, and middle class alike have been living on revolving credit, and IMHO that is a major factor in our current economic situation. And it needs to change. Not for the sake of the rich, but for everyone else. ---
**Author:** ![Gadarene](https://avatars.discourse-cdn.com/v4/letter/g/e47c2d/32.png) [@Gadarene](https://boards.straightdope.com/u/Gadarene)\ **Post date:** [December 7, 2010, 9:01pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/94 "2010-12-07T21:01:28Z")
> [@Little\_Nemo](#): > > That’s the way I see it. Obama’s like Carter - a nice guy but he lacks the killer instinct he needs for the job of being President. To be effective, people have to be a little bit afraid of you. …Or at least a little bit afraid of your Vice-President. ---
**Author:** ![Fotheringay-Phipps](https://avatars.discourse-cdn.com/v4/letter/f/d9b06d/32.png) [@Fotheringay-Phipps](https://boards.straightdope.com/u/Fotheringay-Phipps)\ **Post date:** [December 7, 2010, 9:06pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/95 "2010-12-07T21:06:39Z")
> [@TriPolar](#): > > I guess you aren’t picking it up. A, the personal spending of the rich, is less than B, the personal spending of everyone else. That’s true, but the personal spending of the rich is not 0. It does not follow from the fact that personal spending of the rich is less than that of everyone else that increasing net income of the rich does not increase their spending and thus create jobs. > [@](#): > > Increased income for the rich does not automatically go to personal spending. Right. But some of it does. > [@](#): > > They are already rich, and spend as much as they want. You’re saying that everyone whose income is above $250K spends as much as they want? ---
**Author:** ![godix](https://avatars.discourse-cdn.com/v4/letter/g/278dde/32.png) [@godix](https://boards.straightdope.com/u/godix)\ **Post date:** [December 7, 2010, 9:10pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/96 "2010-12-07T21:10:40Z")
> [@Wesley\_Clark](#): > > The tax cuts were originally passed when the economy was doing good. The debt was predicted to be eliminated by 2012 or so when the 2001 cuts were made. Ah yes, the good old days of 2001. Back when unemployment was rising, the deficit was growing, growth of net worth was negative, and the economy was going through the aftereffect of the dotcom’s blowup the previous year. Your grasp of economic history is truly unique. ---
**Author:** ![Lobohan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobohan/32/79_2.png) [@Lobohan](https://boards.straightdope.com/u/Lobohan)\ **Post date:** [December 7, 2010, 9:23pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/97 "2010-12-07T21:23:05Z")
> [@Fotheringay-Phipps](#): > > You’re saying that everyone whose income is above $250K spends as much as they want? Are you suggesting he is? We’re talking about huge numbers of people. Why would you think he’s declaring \*all \*people act like X? We need to be looking at what large numbers of them do. You are aware that single counter-examples don’t invalidate statistics, right? If so, why would you even ask about _everyone_? ---
**Author:** ![Fotheringay-Phipps](https://avatars.discourse-cdn.com/v4/letter/f/d9b06d/32.png) [@Fotheringay-Phipps](https://boards.straightdope.com/u/Fotheringay-Phipps)\ **Post date:** [December 7, 2010, 9:29pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/98 "2010-12-07T21:29:37Z")
> [@Lobohan](#): > > Are you suggesting he is? We’re talking about huge numbers of people. Why would you think he’s declaring \*all \*people act like X? Because if there are some people with incomes above $250K who will increase spending due to having more income, then there is some amount of demand that will be stimulated by giving these people more net income and some amount of jobs created. If you look back at my original post which TriPolar disputed, I explicitly said that “I don’t know about how the multiplyers work and all that, but it’s a mistake to focus on investing in this context.” (TP actually quoted this part as well.) IOW my point was not that we should give tax breaks to the rich, or that the impact overall is a positive one for the economy, but solely that the primary impact on jobs from doing so - to the extent that there is one - is not from rich people going out to invest the tax-cut money on hiring people, but rather on rich people having increased consumption, which in turn stimulates jobs for providers. ---
**Author:** ![Lobohan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobohan/32/79_2.png) [@Lobohan](https://boards.straightdope.com/u/Lobohan)\ **Post date:** [December 7, 2010, 9:40pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/99 "2010-12-07T21:40:48Z")
> [@Fotheringay-Phipps](#): > > Because if there are some people with incomes above $250K who will increase spending due to having more income, then there is some amount of demand that will be stimulated by giving these people more net income and some amount of jobs created. > > If you look back at my original post which TriPolar disputed, I explicitly said that “I don’t know about how the multiplyers work and all that, but it’s a mistake to focus on investing in this context.” (TP actually quoted this part as well.) IOW my point was not that we should give tax breaks to the rich, or that the impact overall is a positive one for the economy, but solely that the primary impact on jobs from doing so - to the extent that there is one - is not from rich people going out to invest the tax-cut money on hiring people, but rather on rich people having increased consumption, which in turn stimulates jobs for providers. And having most of their needs met in the first 200k of their income, they will likely spend less of their tax savings as a percentage. An unemployed person needs every cent because they are on a shoe-string. $1500 a month is tough to live on. So government dollars spent on them are more likely to be used, right? So if you have, let’s say, $70 billion to spend, doesn’t it make sense to spend it where it will have the most impact? ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [December 7, 2010, 9:41pm UTC](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266/100 "2010-12-07T21:41:12Z")
> [@Fotheringay-Phipps](#): > > That’s true, but the personal spending of the rich is not 0. It does not follow from the fact that personal spending of the rich is less than that of everyone else that increasing net income of the rich does not increase their spending and thus create jobs.Right. But some of it does.You’re saying that everyone whose income is above $250K spends as much as they want? Of course not but the marginal propensity to save is a lot higher at $250K income levels than at $50K income levels. [Previous page](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266.md?page=4) [Next page](https://boards.straightdope.com/t/obama-deals-caves-on-tax-cut-extensions/563266.md?page=6)