In a pre-Super Bowl interview on CBS, President Barack Obama made clear that he intends to raise taxes again:
"There is no doubt we need additional revenue, coupled with smart spending reductions, in order to bring down our deficit," said Obama. "And we can do it in a gradual way so it doesn't have a huge impact. As I said, when you look at some of these deductions that certain folks are able to take advantage of, the average person can't take advantage of them. The average person doesn't have access to Cayman Island accounts, the average person doesn't have access to carried interest income where they end up paying a much lower rate on billions of dollars that they've earned. And so we want to make sure that the whole system is fair, that it's transparent, and that we're reducing our deficit in a way that doesn't hamper growth, reduce the kinds of -- you know, strategies that we need, in order to make sure that we're creating good jobs and a strong middle class."
In remarks at a diner in Arlington, Virginia, Vice President Joe Biden said that the "upside" of going down the so-called fiscal cliff "is even bigger than the downside." Biden attributed these thoughts to "business leaders."
The Washington Post’s Glenn Kessler offers a highly misleading account of the 2001 and 2003 tax cuts, saying they were “passed for the wrong reasons” and implying that, since there was no real need to cut taxes then, there’s no real problem with raising them now. (Kessler makes his claim in the context of admitting that an analogy used by Paul Ryan is “technically accurate,” although Kessler opines that he finds the analogy “misleading.”)
On Meet the Press, Rep. Chris Van Hollen, the ranking Democrat on the House Budget Committee, said that “political courage on the Republican side means taking on the revenue piece” of the deficit equation. In other words, it requires Republicans to support raising taxes. Time’s Mike Murphy and NBC’s Andrea Mitchell agreed. But these assertions belie the facts.
Last year’s unsurprisingly dismal budget numbers contain a surprising revenue story. While overall federal revenue fell precipitously, payroll tax revenue barely dipped at all. This divergent tale of two taxes has one conclusion but many implications. America’s tax system, decidedly tilted toward upper income earners, is precariously balanced. It is not only volatile in economic downturns – it is unsustainable long term.