A test on taxes

A TEST ON TAXES…. President Obama unveiled his debt-reduction plan this week, and as expected, included modest tax increases on the wealthy as a way to improve the nation’s finances.

A few hours later, the Republican National Committee sent out a fundraising email to its supporters. The subject line read, “Confiscator-in-Chief.” RNC Chairman Reince Priebus proceeded to tell prospective donors:

“The Confiscator-in-Chief is at it again — right in time for Tax Day.

“Today, President Obama proposed trillions in new taxes to bankroll the liberal Democrats’ big government policies at a time when our economy is still struggling, gas prices are soaring and unemployment is still alarmingly high. […]

“The tax hikes President Obama wants will only fuel Washington’s addiction to spending rather than help curb it. More importantly, they will hurt one of the strongest engines of growth and job creation in our economy: small businesses. And they will harm middle class families by taking more money from their pockets at a time when Americans need every dime to cover their expenses.”

As a substantive matter, Priebus is engaged in a little something known as “lying.” The White House plan intends to increase revenues to address the budget shortfall — a problem Republicans created and like to pretend they care about — doesn’t hurt small businesses and wouldn’t touch middle class families. The RNC deceives its donors, counting on the adage, “A fool and his money are soon parted.” And for all I know, there are just enough suckers among rank-and-file Republicans for this to work.

The question, though, is whether the pitch will work on a larger scale.

For quite a while, the effort from the right has been to make tax increases a new third rail in American politics. The idea of bringing in additional revenue to help finance a modern government is simply supposed to be impossible, and it’s been a largely successful campaign — income tax rates have only shrunk over the last two decades, despite massive deficits.

The question now is whether Americans are finally ready to tolerate at least some tax increases on some people (in this case, those making more than $250,000).

President Obama joked in his big speech the other day, “Most of us, regardless of party affiliation, believe that we should have a strong military and a strong defense. Most Americans believe we should invest in education and medical research. Most Americans think we should protect commitments like Social Security and Medicare. And without even looking at a poll, my finely honed political instincts tell me that almost nobody believes they should be paying higher taxes.”

And so, the nation faces something of a test. We know the GOP experiment of counting on economic growth through massive tax breaks — the entire Bush-era — failed miserably. We also know the U.S. has some of the lowest tax rates in the world, and the lowest tax burdens domestically in more than a half-century.

Are Americans finally ready for a sensible change? There’s certainly some evidence for it. The most recent Washington Post-ABC News poll asked Americans the best way to reduce the deficit. The Republican mantra — the focus must be on spending cuts, and nothing else — received 31% backing. A combination of cuts and tax increases, the agenda recommended by President Obama, was preferred by a 64% majority.

Just as importantly, are Republicans ready to be responsible? As recently as 20 years ago, the Reagan-Bush Republicans recognized that occasionally raising taxes was necessary. That’s obviously changed, by the Washington Post reported this week that at least some GOP officials recognize that any kind of fiscal solution is going to have to include additional revenue, whether the party likes it or not.

As the RNC letter shows, there’s a lingering immaturity that still dominates Republican thought. Shrieking, “He’s going to raise taxes!” is intended to be the equivalent of “Boo!” Indeed, it’s not just the RNC — the most common Republican response to the president’s debt-reduction plan was to emphasize Obama’s vision of asking more of the wealthy, as if that alone were some sort of conversation-ender.

And maybe there’s something to this strategy. The president’s numbers in daily tracking polls this week have been ugly, coinciding with a bunch of headlines that read, “Obama wants to raise taxes.” I don’t know if one caused the other, but I wouldn’t be too surprised.

But it’s a debate worth having, and I’m glad Obama is showing responsible leadership on this. If Democrats engage in this discussion from a defensive crouch, they’ll lose. If they take the fight to Republicans, and force the GOP to prioritize unpopular breaks for the rich above all else, the public is likely to respond positively.