President Obama’s theoretical willingness to continue the Bush tax cuts for the rich was first hinted at in a New York Times column by Peter Orszag on 6 September. Orszag had stepped down a few weeks earlier from his position as Obama’s director of the Office of Management and Budget, and he was known to be close to Obama; such a column, it was plain, would not have been written without the president’s encouragement. The novelty of the Orszag proposal was that Congress should extend the cuts for just two years.
The next day, a Times headline suggested that Obama would never stand for any kind of extension: ‘Obama is against a compromise on Bush tax cuts.’ But there was a complication. Obama wanted to let the lower rates expire for the top 2 per cent of earners, but stay in force for the remaining 98 per cent, whom he called ‘the middle class’. He was presenting himself as a statesman, uniquely concerned with the middle class, yet mindful of the budget deficit. The Republicans, Obama reasoned, by opposing him would show themselves both careless of the deficit and heartless toward the middle class.
After their midterm victory in November, the Republicans called his bluff and voted down a tax cut that would have been limited to the middle class. On 6 December, the president announced his concession to the Republicans; he would, after all, support a two-year extension of the Bush tax cuts for everyone. Obama’s wager seems to have been that in 2012, if the economy picked up, he would get part of the credit (for sparing the country an unseemly struggle) and none of the blame (for failing to reduce the deficit). But in politics memories tend to be shorter and simpler than that. The truth is that no matter what happens, the cuts will be seen as something the Republicans forced Obama to agree to. If the results are fortunate, the Republicans get the credit. If the economy is still lagging, they share the blame with Obama; but they, at least, were doing what they believed in. To accede to what you believe to be a wrong policy without a fight, and to say publicly that you would rather not have done so, is getting to be a peculiar custom of the Obama presidency.
The self-pity was private in the Afghanistan review a year ago; it was public in the tax compromise this week. Obama cut a deal that helped the opposite party and could conceivably help himself but did tremendous damage to his own party. In remarks following the deal, he denounced liberal Democrats for their ‘sanctimonious’ attitude, their affectation of ‘a purist position and no victories’. At the same time, most strangely, he compared the Republicans to a band of ‘hostage takers’ and claimed by the disagreeable but necessary bargain to have rescued the middle class whose taxes they held hostage.
Doubtless, in surrendering as fast as he did, Obama evaded the stigma of being a ‘purist’; but his settlement can only be called a victory by drastically narrowing the definition of defeat. In return for a two-year extension of the Bush cuts on all incomes, he got a 13-month extension of unemployment benefits. The lower taxes that he could not bring himself to let expire in 2010 he will be much less inclined to tamper with in 2012 when his own re-election is on the line. The word ‘expire’ will soon be forgotten. Meanwhile, by giving a second life to the cuts, he has made lower taxes appear the natural state of things. The Republicans are as earnestly pledged as the president is to reducing the deficit; and since a reduction of military spending is unimaginable to them, the only substantial programmes they will look to trim are Social Security and Medicare.
Obama dislikes the friction of politics. He prefers not to be present at the negotiating table, leaving that work to others, and is disturbed to the point of sudden concession when an important group, party or person threatens to depart in disgust. These are general traits. The odd thing about the tax negotiations is that he gave up so easily and so early. He did it while the Democrats held a majority in the lame-duck Congress. He could have waited until the Republicans took over in January, and supported his acceptance then by a legitimate excuse: ‘Now they have the votes and I don’t have a choice.’ Yet given the chance on any issue at all, Obama prefers to drop a veil of emollient comfort words over the appearance of deep disagreement.
As he testified in his memoirs, Obama came to believe some time ago that he was destined to play an unprecedented role in American life. He was a community organiser with a mission beyond the reach of any community. He became, as Jeffrey Stout has called him, ‘the organiser president’: a national inspirer in place of a leader, through whom good things would flow. He thought they would flow naturally up from the people if he made resonant declarations of purpose. In early 2009, his mostly liberal intentions were declared, and there were good feelings in some places at the bottom, but there was also friction at the bottom and at the top. Faced with many conflicts, on issue after issue Obama retreated.
He now appears to have arrived at a different conception of his function. Whatever flows in America he believes will be improved if it flows through him. He is by preference a Democrat but by circumstance a Republican, and we live in a world where circumstance cannot be defied. When, in his remarks on Tuesday, Obama commiserated with moderate Democrats (who did not try to be purists) and praised the reasonableness of the Republicans (who were also hostage takers), he was speaking from the position of an ex-champion, coach, and impartial commentator all at once, and the performance showed considerable uncertainty about which voice he finds most congenial. His job as he now defines it is to stand at the convergence of forces and help things to go the way they are going.