FISCAL CLIFF & OBAMA'S WEAKNESS

Most commentators seem to be applauding Obama for the resolution of the fiscal cliff issues, but Ross Douthat believes it actually showed his (and liberals as well) weakness. 

. . .it includes a real Democratic concession, which substitutes a top income rate threshold of $400,000 for the $250,000 threshold that President Obama had long insisted on. But at the same time, for liberals seeking progressivity and fairness, that should be the easiest possible concession to make. The $400,000 threshold still puts the top bracket close to where it was under Bill Clinton when you adjust for inflation, and that Clintonian definition of “rich” wasn’t an implausible one: While the whining of the upper upper middle class (or, if you prefer, the not-that-rich rich) can be unseemly, there really is a big difference between a taxpayer making six figures annually and a taxpayer making seven or eight, and setting the top rate in the mid rather than low six figures is a way of acknowledging that the near-rich and super-rich do not occupy the same financial universe.

And here I think liberals have a real reason to be discouraged by the White House’s willingness — and, more importantly, many Senate Democrats’ apparent eagerness — to compromise on tax increases for the near-rich. Liberal pundits seem most worried about what this concession signals for the next round of negotiations, over the sequester and the debt ceiling. But if I were them I’d be more worried about the longer term, and what it signals about their party’s willingness and ability to raise tax rates for anyone who isn’t super-rich 

Politico comments on this issue:   

Obama didn’t get the deal he was hoping for either, but in his mind, now has fulfilled a signature campaign promise and gotten the momentum and template to do more big things in his second term, all while breaking the GOP “fever” that stopped them from raising taxes.

Senate Republicans believed they got a pretty good deal, given the circumstances, senators said. They got a permanent agreements on the Alternative Minimum Tax — a significant priority — and tax rates, which removes the threat of the Bush rates expiring from the next round of negotiations. 

Still, Obama’s decision to raise the income threshold from $250,000 – the line he drew for the last four years – to $450,000 didn’t sit well with the progressive base. The Senate hadn’t even voted before AFL-CIO President Richard Trumka, former Labor Secretary Robert Reich and Iowa Sen. Tom Harkin had blasted it.