Democratic Congressional leaders are steamed at President Obama for locking in a deal with Republicans to extend all the Bush tax cuts temporarily. It’s just caving, they say, and it punts the tax cut fight into the next election. But in exchange for agreeing to the extension, Obama got Republicans to agree to a year-long extension of unemployment benefits, and a year-long, two percentage point reduction in the payroll tax, meant to mimic a temporary extension of the tax breaks that were in the stimulus bill. Each of these concessions will inject much-needed demand into the economy. Could this silver lining be bright enough to make the extension of all the cuts worth it?
This is a companion discussion topic for the original entry at https://talkingpointsmemo.com/?p=117375