The Dem Tax Debacle

Before the election when there was much speculation about whether the Dems would extend the Bush tax rates once the lame-duck session started.  On September 26th a wise blogger wrote this:

We know that at this point Democrats are unwilling to make time to vote on the extension of the Bush tax cuts. After all, they're too busy bringing comedians in to testify before congressional subcommittees. They're promising to take care of the tax cut extension after the November election

Really?

Does anyone believe that will really happen?

What would be their motivation to keep tax rates at all levels from jumping up on January 1st? Are they going to do it to reward the voters who just threw their party into the minority in the House and took away a number of Senate seats? Hardly. The Democrats who return in November will be madder than wet hens at the voters, and many of them will be packing up their offices and laying off their staff. That won't make for a very happy Capitol Hill.

As expected, the Democrats are having a hard time getting their act together:

President Barack Obama's fellow Democrats in the U.S. Congress, many upset with him for election losses, are in disarray over what to do about tax cuts for millions of Americans that are set to expire on December 31.

With time running out and high political and economic stakes, Obama is pushing Democratic leaders to determine if they can win an acceptable extension of the cuts, which he could sign into law.

Resurgent Republicans are demanding that all the tax cuts be renewed, including those for wealthier Americans -- individuals making more than $200,000 and families above$250,000.

Obama favors renewing the tax cuts only for those at or below those level, saying the nation cannot afford to renew them for wealthier Americans.

Despite a number of options -- including renewing all tax cuts or only those for the middle class or tying any extension to a renewal of jobless benefits -- there is no indication a consensus is near.

"How the hell should we know when we will figure this out?" said a senior Senate Democratic aide. "This is the Democratic Party," long known for internal struggles and diverse views.

"It seems like no one is on the same page," said Chris Krueger of MF Global, a private firm that tracks Washington for investors. "It has the potential to be a train wreck."

As Mark Steyn pointed out on the Rush's radio program this week one of the reasons the economy is not recovering is because business hates uncertainty. Employers are not going to hire people if they're unclear about their future expenses, whether it be in the form of income taxes or Obamacare costs. Failing to extend the Bush tax rates permanently for all levels of earners keeps that uncertainty in the market and will extend the nation's economic woes.

Democrats have never learned the lesson that Presidents Kennedy, Reagan and Bush (43) knew - lower tax rates stimulate economic growth and will increase tax revenues.