The just-concluded fiscal cliff deal included no material spending cuts, which the GOP justified by saying it had achieved locked-in rates for most of Bush's tax cuts, which would force Obama to seriously discuss spending cuts and entitlement reform as part of the upcoming debt ceiling negotiations.
But a White House memo announcing the deal said that postponing the sequester for two months "will give Congress time to work on a balanced plan to end the sequester permanently through a combination of additional revenue and spending cuts in a balanced manner."
Does that sound as if the White House has satisfied its appetite for further "revenues"?
The memo is not the only evidence of Obama's intention to further punish producers. After the deal, he said, "Cutting spending has to go hand in hand with further reforms to our tax code so that the wealthiest corporations and individuals can't take advantage of loopholes and deductions that aren't available to most Americans."
We should be concerned because this deal didn't just raise income taxes on the wealthy. It raised capital gains, dividends and estate tax rates, as well as phasing out the personal exemption and deductions for individuals making $250,000 and couples making $300,000, which can add up to serious dollars. What further squeezes does Obama intend to impose?
It wasn't just Obama making threats of additional taxes, by the way. On CBS' "Face the Nation," House Minority Leader Nancy Pelosi said, "In this legislation, we had $620 billion ... but that is not enough on the revenue side." She said we must rid the tax code of unnecessary loopholes and "unfair" benefits that help those who don't need it.
So much for the Democrats' new attitude toward taxes. How about spending? Should we be any more optimistic that Obama will finally be willing to cooperate on spending and entitlement reform?
Though the last page of the post-deal memo casually mentions entitlement reform as an afterthought, the very first paragraph includes this sentence: "And this agreement ensures that we can continue to make investments in education, clean energy, and manufacturing that create jobs and strengthen the middle class."
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