Who gets hurt the most when taxes go up because of politics

I know there are all kinds of people who want to stick it to the top 3 percent of income earners and make them pay the pre-Bush tax rates. While I also know that they have no idea how such actions will affect the economy dependent on their investment for growth, I know that what they don’t want is to increase the taxes on everyone else.

Yet, that is exactly what the Democrats’ game of political chicken could very easily cause. I think that the House Democrats’ failure to vote on Obama’s deal with the Republicans shows just how little they understand about the state of the nation right now. If they somehow manage to create an increased tax burden on the 97 percent of Americans that aren’t “rich” by their arbitrary income standard, it don’t think it will matter to most Americans that it happened because they were trying to raise the rates for people they define as rich.

I have to wonder if this is exactly what Obama expected to happen all along. He knows that the House Democrats are angry because of the whipping they took in the midterms and that they’re angry because of the betrayal they felt toward Obama after he negotiated a deal with the Republicans. I think that Obama believes that across the board tax increases are the only way he can solve the looming crisis of the deficit he helped change from a conflagration to an inferno, and I think he is going to let the lame duck Democrats fall on their swords one more time for his benefit.

Granted, there’s still time to work out some sort of deal, but I wonder if the Republicans will care. I wonder if they’ll let the tax rates expire, increasing everyone’s taxes 50 to 70 percent in the next year so that they have ammunition for the budget fight that will define the next two years.

Whatever happens between now and the end of December, it sets the stage for a political bloodbath in 2012. I have to wonder if any incumbent will be safe, and I have to wonder whether the biggest casualty of this mess will be loyalty to the mainstream political parties.


Via The Daily Beast

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