GOP Threatens Political War Next Year Over Tax Increases

Author: December 12, 2012 5:20 am

GOP elephant and Democratic Donkey head-to-head

Senator Mitch McConnell (R-KY) has finally admitted that the majority of the GOP has faced the reality that income taxes for high income Americans will increase.  He has also acknowledged that Republicans will not be able to negotiate cuts to Medicare, Medicaid, and Social Security until next year when the debt limit needs to be raised. McConnell is the latest and highest ranking Republican to admit that the President has enough leverage to effectively raise the marginal tax rate on top earners.

“What the President’s trying to achieve on the top two tax rates, he can get by doing nothing,” McConnell told reporters at his weekly press conference. “The law is certainly stacked in his favor.”


However, he added that if the President continues to be unwilling to work with the GOP to support cuts and reforms to entitlement programs now, the subject will be addressed again next year. It has been strongly implied that McConnell and Boehner will block a debt limit increase unless negotiations are made to cut social programs.

“When are we ever going to make those kinds of decisions,” McConnell added. “We tried to get the president to do it last year. We now have another opportunity here at the end of the year to try to engage that discussion again. We’ll have another opportunity later, when the debt ceiling issue arrives.”

When asked if the Democratic unity would leave Republicans isolated in their attempt to use the U.S. credit-worthiness as a tool in their efforts to cut major social programs, McConnell replied:

“I think I can speak for every single Republican that we think a request of any president to raise the debt ceiling in the future should involve a discussion with whoever the president is about what we might do about the debt. And we shouldn’t treat it like a Motherhood Resolution; that we shouldn’t airdrop it into Obamacare with no vote; that the decision to raise the debt ceiling is a perfect time to have a discussion about the debt. So we’ll have that discussion later, at whatever point the administration decides that they need to have that authority. But I don’t think that there’s any sentiment whatsoever for giving the President perpetual authority without congressional involvement. … I don’t care whether a majority of Senate Democrats are for that or not. I’d hate by the way to have to defend that in a campaign. But regardless of whether a majority of them are for it, that isn’t going to happen. We are going to insist that we have another discussion about the future of our country in connection with the request of us to raise the debt ceiling.”

While he didn’t specifically state that the 2011 debit limit crisis will be repeated, the implication that there will be no increase without major cuts was definitely implied.

McConnell is not alone in his threats. Conservative Senator Lindsey Graham, R-South Carolina, was far from subtle when he said he will give Obama “one hell of a fight” next year if the plan to increase taxes on high-income earners is pushed through without taking steps to reduce federal deficits.

“But there will come a time in February and March where we have to raise the debt ceiling,” Graham said Tuesday on CNN’s Piers Morgan Tonight. ”I will not raise the debt ceiling ever again until we get significant entitlement reforms, because if we don’t reform entitlements, we’re going to become Greece,” adding that President Obama should use this opportunity to lead. “But if he doesn’t lead, there’s going to be one hell of a fight over raising the debt ceiling.”

Obama is standing his ground, and maintains that he will refuse to consider that negotiating tactic.  Leading Democrats are standing behind him. Tuesday, Democrats rejected any cuts to Medicaid  as part of a fiscal cliff deal. Senate Majority Leader Harry Reid (D-NV) has made clear that his caucus will vote to increase the debt limit or give the President the authority to do so when the  GOP drops its filibuster.

That GOP has almost nothing with which to bargain  As stated by Eliot Spitzer on Slate:

When the GOP nearly threw the country into default during the summer 2011 debt-ceiling standoff, the party contended that raising the debt ceiling encourages more spending. But that of course is not what the debt ceiling does. The debt ceiling does not permit future spending, but rather it deals with the debt accrued by past government spending—including the wild and unfunded spending of the previous Republican administration.

Second, even if this bill were to pass, the power to raise and spend money would still lie solely with Congress. That is in the Constitution: The executive branch can only spend as much money as Congress tells it to. Sen. McConnell knows all this, which is why he proposed last year the very idea President Obama endorsed this year.

GOP Desperation is clearly running rampant. The debt ceiling threat is all they have. Democrats are finally holding most of the cards.

 

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