JONATHAN CHAIT JANUARY 14, 2011
Interesting tidbit in the Washington Post today:
President Obama's refusal to raise taxes for the vast majority of Americans will prevent him from pursuing a broad overhaul of the tax code and is making it difficult for him to achieve his goals for reducing the budget deficit, according to administration and congressional sources.
Administration sources said that? It's clearly true, just interesting to see people in the administration floating the fact that Obama's tax cut promise will make serious deficit reduction impossible.
Of course, Obama promised not to raise taxes on income under $250,000. But he also promised not to extend tax cuts on income over that level. The easy way out of that promise is to refuse to extend the tax cuts for the rich after 2012. Republicans won't extend tax cuts on income under $250,000 without also getting tax cuts for the rich. Ergo, all the tax cuts will expire, thereby solving the medium term deficit problem.