Barack Obama and the 'Centrist' Fantasy

By Michael Tomasky, The Daily Beast

19 April 12

ell, lots of people spent Wednesday making fun of Tom Friedman's column pleading with Mike Bloomberg to run for president. Piling on doesn't interest me. What interests me is that Friedman and Financial Times columnist Sebastian Mallaby, whom Friedman quoted, and others in the center-left orbit they inhabit genuinely seem to believe that if Barack Obama put a bold and comprehensive tax-reform plan on the table, the Republicans would be forced to respond and negotiate in good faith. But this is pure fantasy. All that would happen would be that Obama would cost himself loads of political capital, and the center of gravity on the subject of taxation would again be pushed to the right. That isn't just bad for Obama, which is a second-order concern; it would be horrible for the country.

I'm sure that people like Friedman and Mallaby, and Erskine Bowles and Alan Simpson and Alice Rivlin and Pete Domenici, mean well and operate in good faith. They want to see a president issue big and courageous proposals, and they want Congress to rise above the blah-blah-blah. They want our system to vindicate itself. Well, who doesn't?

Unfortunately, it won't. Let's imagine a scenario. Obama comes forward with a tax-reform proposal along Bowles-Simpson lines, one that meets the GOP halfway. He comes up with three marginal rates for individuals, the highest one around 35, maybe 38 tops; or maybe he adds a fourth "LeBron James" rate, a higher rate on dollars earned above some fantastically high figure that applies to something like .2 percent of all tax filers; but that would probably be in there as a bargaining chip. He proposes the elimination of certain "tax expenditures," or deductions and loopholes like the home-mortgage-interest deduction and the deduction for employer-sponsored health care, which are the two big ones; or maybe he's more modest about this and places caps on those, not eliminating them entirely; or perhaps he sticks with something like getting rid of the state and local tax deduction. Finally, he lowers the corporate rate from the current 35 percent, but proposes closing several corporate loopholes, like energy-tax preferences for the oil and gas industry.

WWMD? That is, what would McConnell do—and Boehner, and Cantor, and the rest? Would they scratch their chins and say, "Gee, this is great. We're delighted that the president has put something serious on the table, and we will work hard with him to find common ground"? Actually, they might say that, at first, just to pull the wool over people's eyes. But in short order, the line from them and their confederates in positions of lighter responsibility would be: "This is a massive tax increase! Eliminating these deductions on middle-class people will raise their taxes, so he's breaking his promise, see, we told you! The LeBron tax is just more 'Democrat' class warfare, more punishing the job creators." "The corporate plan," they'll say, "sounds good on paper, but again, he's attacking the job creators by eliminating these important deductions, and many corporations, especially small businesses"—you know they'll throw that one in!—"are going to end up paying more."

If Obama meets Republicans halfway, and then they block a deal, the center will shift further to the right. Republicans know this. That's why obstructionism suits them just fine.

And that's just elected officials. At Heritage and Cato, they'll comb through the fine print and find an Achilles' heel, something that can be distorted to sound just hideous, which will of course be in there, because tax policy is unbelievably complex. And then, once Mr. Oxycontin and the Fox people start hooping and hollering about that, it won't be long before the whole thing can be dismissed as something Marx would be proud of.

No they wouldn't, you say? Why? Because their allegations wouldn't be true? Oh, yes, that has regularly stopped them in the past. Or because there would be too much pressure on them to behave responsibly this time? Pressure from whom? The New York Times and Washington Post editorial pages? Please. Direct me to one instance—and no, the Post and the Iraq War doesn't count, because that was the Post endorsing something Republicans were for anyway—when Eric Cantor has read a Times editorial and said, "Golly, these fellows make some very fair points, I must heed them." The only pressure they pay attention to is from Limbaugh, Fox, and the base. And that pressure will consist entirely of one message: resist, at all costs, or perish.

And that's what the Republicans will do. There's every reason to think it will be even worse in a second Obama term, because the base will be so enraged that the guy "stole" another election that the demand will be that the Republicans be even more obstructionist. And yes, there are a few honest Republicans. But Barney Frank summed up nicely in his interview with New York magazine why they can't be relied on for anything:

"People ask me, 'Why don't you guys get together?' And I say, 'Exactly how much would you expect me to cooperate with Michele Bachmann?' And they say, 'Are you saying they're all Michele Bachmann?' And my answer is, 'No, they're not all Michele Bachmann. Half of them are Michele Bachmann. The other half are afraid of losing a primary to Michele Bachmann.'"

That, alas, is the size of it. Columnists and wise men and women can afford the luxury of pretending or hoping that Republicans will behave as an American political party is supposed to behave. But Obama can't. All it would accomplish is to put himself in an extremely vulnerable position: He'll have expended an enormous amount of political capital in putting forward a big proposal, and he'll lose, and the Republicans will convince a significant portion of the country that it was Obama's fault for being "partisan.

But the worst outcome is this: if Obama makes a big proposal that meets the GOP halfway, and they block it, then the substantive center of gravity will shift to the right one more time. The same people who now wish that Obama would "show leadership" will make the same demand, except that next time, that demand will mean that he offer even lower rates in order to win Republican support. Guess what? The Republicans know this. Obstructionism suits them just fine.

That's the reality of today's GOP. What can change it? Not much. Losing lots of elections. If they're ever down to 38 senators and 153 House members like the good old days, they'll have to deal. Until then, Obama wouldn't be a leader if he tried to negotiate with them in good faith. He'd be a fool.