$1.5 Trillion In New Taxes? Ho Hum.

President Obama previewed a new plan to cut the deficit yesterday. The plan is to be unveiled this morning, but don’t expect it to amount to more than a handful of talking points. This is an opportune moment to repeat what we have said many times before: it would be helpful if the Democrats would fulfill their statutory obligation by proposing an actual budget, which they haven’t done for more than two years.

So, according to press reports in advance of Obama’s presentation this morning, what is in the new “plan”? The administration’s new plan sounds exactly like its old plan. Obama says he wants to raise taxes by $1.5 trillion, mostly by letting the Bush tax cuts expire with respect to families earning more than $250,000 a year. The rest will come from barring such families from taking deductions to which they are now entitled.

As every commentator in the world, more or less, has already noted, Obama couldn’t get Congress to raise taxes on higher earners to pre-Bush levels when the Democrats controlled both chambers of Congress. Obviously it won’t happen now that the Republicans are in charge of the House.

Beyond that, the administration’s plan consists of “saving” a trillion dollars that won’t be spent on the Iraq and Afghanistan wars. Of course, no one ever planned on spending that trillion dollars in the first place. Obama could just as well pretend to be saving $2 trillion; all he has to do is claim that he had, until now, an unannounced intention of spending that much more on the wars. No one considers this anything but a bad joke.

The last element of Obama’s plan consists of minimal savings in Medicare and Medicaid. Obama proposes no reforms in these programs, however. If it turns out that these “savings” come from rooting out fraud and abuse, you will know that the White House invested no more than 15 minutes in coming up with its new plan.

The ostensible point of this proposal is to serve as a starting point for negotiations in the joint committee that was set up in connection with the extension of the debt limit. The real point, however, was implicitly acknowledged by the New York Times:

The Obama proposal has little chance of becoming law unless Republican lawmakers bend. But by focusing on the wealthiest Americans, the president is sharpening the contrast between Republicans and Democrats with a theme he can carry into his bid for re-election in 2012.

The usual term for that is “demagoguery.”

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