I just read a Politico column titled, “The 37 percent solution?” I have an idea on a different solution, but the question is whether or not Democrats need to budge at all. 39.6% is coming, and once it’s here, with a deficit like this, 35% is not coming back. Chris Matthews mentioned something to the effect today. How far does “the rich need more” sales pitch go with record deficit? Nowhere. On the other hand, a tax cut for 98% of Americans will be popular. A majority of Americans agree. Our President agrees.
That said, does it benefit our country, in any way, to compromise on the cliff deal? I say yes. It is a symbol of respect, and respect is vital to compromise. It is a statement of giving, Democrat to Republican, with the potential political benefit of strengthened long-term relationships. Compromise on the cliff deal, but compromise on the amount, not the percentage. In 2013, a $250,000 annual household income after 39.6% federal tax rate is not exactly wealthy, in particular for big city residents. To Democrats, I say offer a $350,000 deal (potentially $400,000). It has a relative minimal effect on total tax revenue compared to percentage reduction, it builds mutual political respect that improves the American political system moving forward, and it does real good for thousands of America families and small businesses.
Then, 2013 can begin.