John Ransom

There is only one way out of the budget mess that the Obama finds him in.

He must successfully raise taxes.

After gaining the majority on fiscal issues and then losing the majority on fiscal issues, Democrats in Congress can’t afford to concede the field to Republicans on spending but neither can they afford to raise taxes.

Obama has vowed to fight budget cuts, saying we need a scalpel not a machete.   

But right now, it’s every Congress-tron for themselves.

By agreeing to cut spending without an increase in taxes, Obama will cut the ground out from underneath the progressive wing of his party saying, in a paraphrase of Otter from Animal House, “You messed up. You trusted us.”

Forget about liberals’ preoccupation with redistributing wealth.

Sure, they want to do that.

But the tax hike is oh-so-very necessary because without it, they lose.

Without a tax hike, Obama will have to admit that it’s been his poor handling of the budget that’s led to the largest deficit ever. Without a tax hike, he’ll have to admit that his stewardship of the economy has been a lot of sound, but the only fury created has come from fleeced taxpayers.

Without a tax hike, 65 million Americans will be wearing t-shirts that say “I voted for Obama and all I got was a debt increase.”

Without a tax increase, Obama has nothing to run on but a bunch of unpopular regulatory and spending measures that have done nothing demonstrable to help America grow stronger.

That’s why it’s not just ideologically sound for Republicans to reject a tax increase, but politically sound as well.

At least one GOP leader seems to understand this.

“Throwing more tax revenue into the mix is simply not going to produce a desirable result,” said Senate minority leader Mitch McConnell on This Week, “and it won't pass. I mean, putting aside the fact that Republicans don't like to raise taxes, Democrats don't like to either.”

Obama is hoping he can peel off a few GOPers to side with him on tax increases, creating another “Read my lips, no new taxes” moment amongst Republicans and keep them divided.

Forgetting the whys and wherefores of how a tax increase would affect the actual budget, Obama needs a divided GOP, because he’s never going to unify the Democrats around the concept of raising taxes. And when Obama can’t unify, he inevitably tries to divide.  

“I think we've gotten to the point where we ought to put aside our talking points and get down to what can actually pass,” McConnell said on Sunday “[T]he whole business of raising taxes, regardless of how you go about it, is something that this Congress is not likely to do.”


John Ransom

John Ransom is the Finance Editor for Townhall Finance.
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