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Obama blows $800 billion in additional tax revenue

By: Dan Spencer (Diary)  |  July 23rd, 2011 at 09:14 AM  | 

RESIZE: AAA

Blame Obama’s insatiable insistence on more and more taxes for the collapse of the debt ceiling negotiations.

In the Los Angeles Times, Peter Nicholas and Lisa Mascaro tell us that on Sunday, July 17, Obama and the Republicans had agreed upon “$800 billion in revenue increases.”

On Tuesday, July 19, the Gang of Six unveiled its deficit reduction proposal that included more than $1 trillion in tax revenue. Claiming the Gang of Six proposal “changed the dynamics of what they could do,” the White House then insisted it needed an additional $400 billion in new tax revenue.

It was this last minute demand for another $400 billion in new tax revenue that the Republicans blame for the collapse of the debt ceiling negotiations.

In his “hastily arranged” Friday evening press conference, ”a visibly irritated” Obama said “it’s hard to understand why Speaker Boehner would walk away from this deal.” Obama might find it hard to understand why Boehner walked away from this deal, but I don’t.

Insisting on a 50% increase in a major item is no way to close a deal. The Republicans had already offered, and Obama had agreed to, $800 billion in “added tax revenue.” Obama blew the deal by suddenly insisting on an additional 50% increase in tax revenues.

Speaker Boehner, in his news conference, explained that it was Obama’s insistence on more taxes led to the breakdown in debt ceiling discussions:

  • The White House Insisted  on Raising Taxes, Moved Goalposts

The discussions we’ve had broke down for two reasons.  First, they insisted on raising taxes. We had an agreement on a revenue number – a revenue number that we thought we could reach based on a flatter tax code with lower rates and a broader base that would produce more economic growth, more employees and more taxpayers, and a tax system that was more efficient in collecting the taxes that were due the federal government. Let me just say that the White House moved the goalposts. There was an agreement, until the President demanded $400 billion more, which was going to be nothing more than a tax increase on the American people. I can tell you Leader Cantor and I were very disappointed in this call for higher revenue. Second, they refused to get serious about cutting spending, and making the tough choices that are facing our country on entitlement reform.

  • Obama Sought a Clean Debt Limit Increase

You know, until recently the president was demanding that the Congress increase the debt limit with no strings attached. As a matter of fact, the Treasury Secretary sent me a letter two days after we were sworn in in January demanding that we give him a clean increase in the debt limit. I immediately responded and told the Treasury Secretary that the American people would not tolerate a clean increase in the debt ceiling unless there were serious spending cuts attached and real reforms to the way we spend the American people’s money. I went to New York City in May, gave a speech to the New York Economic Club, where I outlined the challenges we were facing and I made it clear that we would not increase the debt limit without cuts that exceeded that increase in the debt limit, that there would be no new taxes, and that there would be serious spending reforms put in place.

  • If the White House Won’t Get Serious, We Will

I can tell you it’s not in the best interest of our country to raise taxes during this difficult economy, and it’s not in the best interests of the country to ignore the serious spending challenges we face. … Now I want to say, this is a serious debate. It’s a debate about jobs, it’s about our economy, and frankly it’s also a big debate about the future of this country.  … Listen, it’s time to get serious, and I’m confident that the bipartisan leaders here in the Congress can act. If the White House won’t get serious, we will.

You can watch Boehner’s statement below:

If you care to watch Boener’s entire press conference it is available here. Obama’s is available here.

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COMMENTS

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  • johnt

    seemed to be confused as to why he walked away from the WH, after all, it was only $400 billion. Obama’s freakish dishonesty in going back on the agreement they had, the transparent desire to not have a agreement, was lost on the apparently morality deprived newsman.
    It appears, and not for the first time, that this disturbed person who is president actually believes the incoherent & lying babble that falls from his lips.
    Maybe that’s why the media loves him, birds of a feather kind of thing.
    May we hope that the Speaker firms up a bit in his dealings with this gutter trash.

    • gawken

      Yes, Obama will happily throw senate Dems under the bus to get re-elected, but he can only throw them just so far. I mean, can you imagine tryign to toss Mikulski or Stabenow?

      So, when he mentioned the parameters of the deal, they told him they needed MORE revenue to sell it to the Dem caucus..so he reneged..and it blew up in his face..

    • DaveWT4

      I am sick to death of budget pundits saying a few billion dollars is meaningless. Anytime anyone says that an expenditure is a waste they throw out the ‘well it’s just a drop in the bucket, why worry about it?’ It’s 400 FREAKING BILLION DOLLARS!

      Anyone needing a good visualization to show your liberal and non-budgetary friends should send them this link:

      http://www.wtfnoway.com/

      My brother has had a hard time grasping the enormity of the debt issue and found this. His comment from Twitter: “Wow…this is just…wow. We are so screwed.”

      My reply: “Yup, pretty much.”

      • http://travismonitor.blogspot.com Freedoms Truth

        Aside from the absurdity of $400 billion being chump-change, the problem is that it is all going in the wrong directions.

        There should not even be $1 let alone $800 billion in ‘revenues’ out there on the table.

        What’s one more six-pack of beer to an alcoholic? Maybe not much. But you dont cure a spending addiction by piling it on.

        And the Republican cannot and must not become the conscripted tax collectors for Obama’s Big Government Statism.

      • Finrod

        .

    • johnt

      you see it as a power grab, complete control, it makes sense, Obama, the Dems, and the people who create their image, the media, have no regard for fiscal or political constraints. It is only the primitive urge for dominance, come down from the nastier cave men, that we observe in Washington, embodied in the above cast of degenerates.
      Amazing that some in the Republican camp & elsewhere really believe they can deal with these throwbacks, that somehow they see them as normal, or close to it. The Republic is on the verge & they’re talking about deals.

  • willopine

    Obama negotiates like Arafat.

    • Vegas_Rick

      nt

  • skorrent1

    Have the Feds actually spending one penny less in FY12 than they are spending this year? I doubt it.
    Even under a “continuing resolution” they are spending 4% more this year than last.
    Politicians use a different language than you and I.

  • GopTiger

    Apparently, there will be no Grand Bargain. This is a very good thing in my opinion.

    First, with Obama in the White House and Reid controlling the Senate, the only way you could have a Grand Bargain is if there were signficant tax increases. Perhaps all of our insistence on no new taxes has paid off because Boehner does seem to have held the line of this. What we are likely to get now is just a bare minimum deal that allows Obama to kick the can to January 21, 2013.

    Second, without a Grand Bargain, Obama can not reposition himself as a fiscally-responsible centrist before the 2012 election. I was already getting sick at the thought of him going on television and annoucing how he had “led discussions” that had come up with the “biggest bi-partisan deficit reduction agreement in history”. The thought of that has been making me think about pulling an Elvis with my tv set.

    Third, I’m convinced part of Obama’s peevishness last evening is his growing awareness that, without the Grand Bargain, he won’t be able to play Mr. Debt Reducer for the squishy independents in 2012. With a bare minimum deal, he is left playing the role of Barack Obama, Government and Debt Miracle Grower. Even he knows this is not likely to help him next year.

    However, if-as many of you suggest- Obama simply raises the debt ceiling on his own, he creates his own worst potential scenario of all. He would get no credit for defict reduction. He would have not only triggered a constitutional challenge (that he would most likely lose), but he would make it infinitely easier for Perry, Bachman, Pawlenty, or even Romney to paint him as the wannabe leader of the world’s largest banana republic.

    Maybe this has been part of the Boehner calculation all along.

    • kajun65

      your assumptions are correct. Unfortunately, I don’t believe Boehner could of calculated such a plan. I personally feel they are both pandering to their base and what?s coming conservatives will not like.

    • CMaree

      Boehner, Cantor and conservatives in both House and Senate!

      Remember the glory days of 94-95 when the Contract for America led to a Republican election rout in the Congress. Newt Gingrich was even deemed “Man of the Year.” Then Congress passed and Clinton signed the 1996 reform of welfare and a capital gains tax cut, and for a time the accolades rested on the Republicans. Over time the accolades have shifted to President Clinton. Never mind that it was political power over principles that had him ink the bills. This week I heard a talk radio troll praise Clinton for the fiscal and moral results of those acts.

      So I say hold the line now and to Nov 2012. Let the consequences of No Grand Bargain shift and rest heavy on the narrow shoulders of this Administration.

    • Spiral

      You are correct.

      The GOP should not be trying to help Obama get reelected. This means a few things:

      [1] The GOP should accept a debt limit increase so that the horrible economy remains the Obama economy, not the Boehner-McConnell economy.

      [2] After having raised the debt limit, Boehner and McConnell should say to Reid, Pelosi and Obama, “If you want to cut the deficit, submit the legislation. Don’t call me to negotiate a backroom deal. That’s what the House GOP did with the Ryan budget and Cut, cap and balance. If you really want to reduce the deficit, go public with your plan. Otherwise, I will assume you give a hoot about the deficit because you believe in discredited Keynsian economics where a large budget deficit is needed to stimulate the economy.

      [3] The GOP should refuse to accept any tax increases or spending increases beyond what is called for in current law and/or a continuing resolution.

      [4] The GOP must win the US Senate and the White House in 2012, in addition to holding on to the US House.

      [5] The GOP must terminate, using the constitutional option, the filibuster rule. Otherwise 41 Democrat US Senators could block the conservative agenda in 2013 and force the United States to continue with Obama’s policies, not to mention prevent any conservative judicial nominees from being confirmed to the federal appeals courts or US Supreme court.

      • http://travismonitor.blogspot.com Freedoms Truth

        Spiral, please STOP with the phony assumptions here that we have to cave on the debt ceiling in order not to own.

        Obama’s default threat is phony. We KNOW it is phony. It always WAS phony. Obama needs the deal, any deal, more than we do. Obama NEVER has to go into any kind of default at all. What will happen, at worst, is a partial Government shutdown. Minnesota survived worse, and guess which side had to back down?

        So amend you deal

        (1) The GOP should accept a debt limit increase that follows their parameters – spending cuts above the debt ceiling increase and NO TAX HIKES. They have Cut Cap and Balance as long-term plan, and should have a short-term alternative, that cuts in FY 2012 in exchange for a 4 month/$400 billion extension.

        (2)Boehner and McConnell should say to Reid, Pelosi and Obama, ?If you want to raise the debt ceiling any other way than Cut Cap and Balance or a short-term increase, submit the legislation. Don?t call me to negotiate a backroom deal. That?s what the House GOP did with the Ryan budget and Cut, cap and balance. If you really want something, go public with your plan, pass it in the Senate, then we will deal. Otherwise it is Cut Cap and Balance or nothing.”

        (3) The GOP should refuse to accept any tax levels or spending increases beyond what is called for in THEIR BUDGET PLAN.

        [4] The GOP must win the US Senate and the White House in 2012, in addition to holding on to the US House. THEY WILL DO THIS BE SHOWING A CONSISTENT AND REASONABLE STANCE ON THE NEED TO CUT SPENDING.

        • westcoastpatriette

          .

        • Spiral

          Freedoms Truth,

          You seem to think that sometime soon Obama and Reid will convert to conservatism and accept huge spending reductions without huge tax increases.

          I don’t see it.

          Also, very, very few Republicans in Congress (you can probably count them on two hands) will accept an immediate 40 percent reduction in government spending, which would be required if the debt limit is not increased.

          This means that at some point the GOP House and the Democrat Senate will vote to increase the debt ceiling.

          That’s reality.

          If we want to change reality, we need to get a Republican, preferably a non-Romney Republican, in the White House come January 2013 and we need a GOP majority in the US Senate.

          The kinds of changes that we conservatives want, signficant reductions in spending, will only happen if the GOP controls all of the levers of power, US House, US Senate and president.

          And, as recent history shows, even if the GOP does win the US House, US Senate and White House in 2012, this does not guarantee that signficant spending cuts will be made. After all, under Hastert, Frist and Bush, spending went up, not down.

          Also, as long as the filibuster rule remains in affect, 41 Democrat US Senators can block spending cuts on entitlement programs like Medicare, Social Security and Medicaid.

          So, come January 2013, the GOP should junk the filibsuter rule and allow a majority of US Senators to end debate on spending cut legislation.

          It’s a lot of work. But it must be done.

          Anyone who thinks it will be done while Obama is still in office is just plain wrong. Obama is a Marxist. He won’t allow spending cuts. Ever.

          • Finrod

            Why that amount, $400 billion? That was the largest yearly deficit under George W Bush. When passing it, make a whole lot of noise about that fact; “if Obama wasn’t a bigger spender than Bush, this debt increase would be enough for a whole year”, etc. Then when the media calculates how long that big of a debt increase will actually last us (3 or 4 months), that’ll help pound that fact into the public’s heads.

  • izoneguy

    We all knew this was going to be painful.
    Obama is like a crack addict who can’t stop.
    Break the crack pipe and put him on the rubber room. Stat.

  • izoneguy

    Hmmm, I guess Obama needs to pay for that failed Stimulus bill.

    It looks like the Obama administration is the only shovel ready project
    to come out of the failed Stimulus bill.

    At least gays can openly serve in the military now…..

    Happy (Gay) days are here again!

    • carolina

      BO & the dems WASTED almost a $trillion of our tax money bailing out their public union buddies. Every time I think about it I get steamed!

      • izoneguy

        Obama comes back over & over to demand more & more – and for what?
        Obama just needs to be put on the side line – he is not a leader – he is just a water boy for the union bosses.

  • Michael M. Keohane

    In business, a person who proposes a major change in the terms of an agreement at the last minute is called a “deal breaker.” “Deal breakers” are not considered to be trustworthy individuals and, as far as possible, are not sought out when deals are being made.

    President Obama is, among his many other faults, a “deal breaker” and should never be trusted.

  • rbdwiggins

    That’s pure insanity, because it removes the Albatross from Obama’s neck.

    A short-term debt limit increase of around $600 Billion or approximately six more months of deficit spending will reignite the debate after Christmas and at the height of the primary season (Last resort only).

    The GOP’s electoral prospects in 2012 will likely reach landslide proportions if Republicans systematically hang the purely partisan rejection of a balanced budget amendment around the Democrats’ collective necks. Obama and the Democrats will find themselves at odds with nearly 75% of the American people.

    • rbdwiggins

      Somehow this reply was disconnected from GOPTiger’s comment.

      • CMaree

        for GOPTiger. Unless the FLOTUS has her way and gets rid of fatty, yummy Frosted Flakes and their advertising mascot, Tony the Tiger.

        Regulate and tax, regulate and tax. . . can we stop this political mantra?

    • GopTiger

      My post is not about what should occur, but what is likely to occur. If anyone thinks the House Republicans are going to get him to cry “uncle” and accept trillions of dollars of spending cuts…well, I think they are fooling themselves.

      At this point, I think there are only two likely scenarios. Mind you, not preferred scenarios, or possibe scenarios, but likely scenarios.

      With Scenario One, we get a “deal” somewhere in the order of 1.5 Trillion dollars worth of cuts with a pledge from both sides to examine the tax code to close loopholes in the future (somewhere to the tune of 800 billion). If there is a deal, this is most parameter. Obama and Reid are not going to allow for more cuts unless there are additional taxes. Let’s all remember-Obama and Reid hold two cards of three cards in this game-the GOP only one. As much as it bothers me, we are not going to get substantial spending cuts beyond the 1.5 Trillion or so range. Obama and Reid will not let it happen unless we jack up the tax rates. Good people like Erik and countless other conservatives have placed enough pressure on Boehner and Cantor to guarantee no House approval of tax increases. So we are at an impasse.

      But I am increasing becoming convinced there will be no deal but there will be no shutdown either. This brings us to Scenario Two.

      With Scenario Two, Obama orders Treasury to continue to issue debt , even if it means provoking a constitutional crisis. You have people like Krugman and Bill Clinton already egging him to do precisely this. The foundation is already been laid in the media for this scenario as we speak. When Obama said last evening that there would be no default, I took him at his word. He’ll isssue the debt himself, thinking it will help him look like the Saviour of the Republic with the liberal softheads. I’m sure his lawyers are already preparing their legal arguments for why the 14th Amendment gives him the power to do such. Sure, it will provoke a constitutional crisis, but I don’t know of too many liberals who worry about what they consider to be the “finer points” of the Constitution. Actually, they will praise his willingness to make the Constitution truly a living document and, according to them, Obama will now be the word made flesh. If you think I’m over-the-top in how the Left will play this, rewind the 2008 election tape. Of course, only the Left will buy this line of reasoning as, increasingly, independents exit the ObamaTheater.

      Either way, I think Obama is screwed politically. Either way, he never gets the cover of being a deficit cutter and he is stuck having to defend runaway debt and government spending in 2012. If the economy was creating jobs, he might get away with justifying all of this spending. But without economic growth, he can’t make that argument-at least not with the squishy independent he needs again to be re-elected. Much of his petulance last evening was his awareness of this reality. Obama is being boxed in, by time and events and the Tanned One.

      Of course, I could be wrong. Maybe Barry blinks and accepts 4 Trillion dollars worth of spendning cuts with no additional taxes at the very end. But that is not the good old neo-Marxist, community organzing, Narcissist-in-Chief we have all come to know and despise. As with everything else in his life, Obama is looking for the escape hatch that allows him to not follow the rules of normal human behavior.

      I would love to be wrong about this, but I don’t think I am.

      • Spiral

        Spending cuts will not happen as long as Obama is in the White House and Harry Reid is Senate Majority Leader.

        Given that Reid was upset at a GOP plan to defund the Cowboy Poetry Festival in Nevada, you can bet that Reid would oppose spending cuts unless they are in exchange for huge tax increases.

  • http://jhpruitt.blogtownhall.com/ kipling

    Either Mr. Obama does not understand how to negotiate or he intentionally blew the deal by demanding the extra taxes. If he intentionally blew the deal then he may want to provoke a debt ceiling crisis. Why would he want such a crisis? Does he think it will help his reelection to have the country’s credit destroyed or does he think the Republicans will cave completely?

  • dkm466

    Announcement of *800 taxpayers/citizens pay more while Bohner is saving the US taxpayer *400.

    What a crock. Message Manipulation you think?? They are raising the Debt ceiling x800. This was the press release. The reason for the x400 annoucement was to give Bohner political cover.

    He gets to say ” I walked out” Shell Game Bull Mess.

    I’ll say it again, Gangster Government

  • Viator

    My way ($1 trillion+ new revenue) or the highway (14th Amendment)

    The expression originates from a policy of tax collection devised by John Morton, Lord Chancellor of England in 1487:

    if the subject lived in luxury and had clearly spent a lot of money on himself, he obviously had sufficient income to spare for the king. Alternatively, if the subject lived frugally, and showed no sign of being wealthy, he must have substantial savings and could therefore afford to give it to the king. These arguments were the two prongs of the fork and regardless of whether the subject was rich or poor, he did not have a favorable choice.

  • urherex

    from Republicans, He can just take the $3.5 Billion from G.E.
    After all they didn’t pay any taxs ( make any contributions)
    last year.
    It sure would be a shame if he had to cancel his B-Day
    party(s), I think even he knows some of his followers might
    think that’s a little over the top, even for him.

  • KC

    ….Boehner had agreed to $800B in TAX INCREASES he had adamantly sworn to oppose?

    Get ready folks – tax increases are in our future.

    • acat

      Do I want tax increases? Hell no! Am I willing to accept them under certain circumstances? Yes.

      Currently, something over 40% of Americans pay zero income tax. That creates an unstable society, and encourages exactly the “vote themselves bread and circuses” mentality that is the inevitable death-knell of democratic governments.

      One example that I would accept is introducing a “floor” income tax rate. That is, “everyone who earns income must pay at least 1% in income tax”.

      I doubt the Dems would accept that .. unless it were sold as some kind of “taking away deductions from the super-rich”… but it would distribute the load of governing our society more equitably, and would make smaller (cheaper) government more appealing to the working poor.

      Mew

      • tritonspolartiger

        …..a situation where things can be rectified in such a way that we’d have an income tax floor, but I’d support it. I believe your assertion – that having 40+% of the populace paying no federal income tax is a source of societal instability – is correct.

        Fairness, properly defined, means we ALL share the burden of funding our government…

  • tea4me

    …anyone in the conservative political body or media put a freakin’ end to this “increase the taxes on millionaires and billionaires” strawman marxist propaganda?

    Are they THAT freakin’ stupid?

    The left wants to increase income taxes! INCOME!!! Millionaires and billionaires don’t freakin’ care about income taxes. They live off of CAPITAL GAINS!…and pay a 15% capital gains tax!

    And they’re all laughing their arses off at the working class stiffs who are going to get stuck with all this mountain of tax hikes Obama and the leftists want us to pay. All the while filling up Obama’s campaign coffer along the way.

    NO ONE….ever calls these leftists out on this!

  • electroncollector

    If the republican leadership continues to lead us down Obama’s road to destruction I will both send money and work for any one that will run against them. If no one can primary them I am very willing to help their democratic challenger with money and/or time. A democrat in place of one of our misguided republican leaders looks much safer to me.

  • wbb1950

    The boffo (or buffoon) performance we saw yesterday should disabuse anyone who lives in the same world as most of us of the foolish notion that Obama is a leader. Leadership is a function of character and ability. He has neither.

    1. As leader of government, as well as his party, Mr. Obama entered into a binding agreement with the Speaker of the House to deal with the most serious problems confronting the country, which calls for $800 billion in new revenue. This is a hard and fast number.

    2. After he made that agreement, he went back to his constituents, and informed them of what he had agreed to. We then find that he made the agreement without ever consulting with them. Naturally they balk. Despite his leverage, his positional authority, and his ownership of big media, he can’t or he won’t sell it.

    3. Instead, he went back to the Leader of the House and demands a sweetener, i.e. 50% increase over what he agreed to but did not sell. He offered no off-setting concession to balance the scale–just more. more, MORE of the taxpayers money and China’s money so he can have a grand bargain which he can tout to the ignoranti for the 2012 campaign which in his own mind he has already won.

    4. Not surprisingly, the Speaker told him he cannot accept this. He could have said something like if you do not keep the agreements you negotiate then it is a waste of time for me to negotiate with you and time is of the essence. He could have said if you made a deal that you cannot live with do not look to me to save you from your mistake. I have constituents too. But he is a gentleman and simply says the White House has moved the goal posts, and I will deal with the Senate.

    5. Whereupon Obama throws a hissy fit, and blames the Republicans for the breakdown in the debt ceiling negotiations to cover his own mistake. This poisons the well even further, and the Speaker?always a gentleman?to much so in my opinion says he will not engage in partisan bickering.

    6. Whereupon, again predictably, big media covers for Obama and blames the Republicans. This morning there is a headline in USA today which says that Obama stands for fairness, and by inference that is why the talks broke down. That headline was a masterpiece of deception. It looks past the hard facts and presents an Obama talking point. Now every politician publishes press releases and hopes big media will at least read them. With Obama however they print them as if they were fact and suppress contrary evidence.

    7. Earlier this week we learn of a stark admission by the head of MSNBC which was related to us by video by the former head of one of their panel discussion shows. This is a little like having a Soviet agent defect–rather than condemn his for what he was, listen closely to what he says. According to him, Phil Griffin told him explicitly that “we are the insiders in this Administration, part of the establishment?, and will not brook critical comments about Obama from its talking heads. This is true of CNN, ABC and CBS as well. This explains their continuing cartel of lies.

    8. Finally, the Boston Globe is criticizing Obama for being like Spock? I will take the criticism, but I think it is misdirected. Whatever his shortcomings may have been, Spock never through a hissy fit. Barack is more like to Caligula.

    1. Caligula:
    ?I have existed from the morning of the world and I shall exist until thelast star falls from the night. Although I have taken the form of Gaius, I am all men as I am no man and therefore I am a God.?

    2. Chaerea:
    Give him enough rope…
    Longinus:
    …and perhaps, he’ll hang us all.

  • wbb1950

    Yesterday’s boffo performance by Obama is the zeitgeist of his errant benighted presidency. It is like the old Hans Christian Anderson movie where the swindlers i.e. big media convince the king that nothwithstanding his lack of experience and character flaws he is somehow presidential, whereupon the public not wishing to appear ignorant or racist pretends those flaws do not exist, until a defining moment occurs which reveals what he is and what he is not –all pretending to the contrary notwithstanding. Yesterday we saw Obama in the “all together” and the spectacle of it was not pretty. It really is all too chilly a morn for this.

    http://www.youtube.com/watch?v…