Tax games

Majority congressional Democrats had been expected to call for a vote before the Nov. 2 election on a proposal to extend beyond Dec. 31 the “Bush tax cuts” for American families earning less than $250,000, while raising taxes on “richer” Americans.

Republicans, who favor extending the tax cuts for all Americans, could be expected to vote against such a selective extension. Holding such a vote before the election was thus expected to provide Democrats with some grist for their campaign mill, since Republicans could then be accused of “blocking tax cuts for the middle class” in the interest of “protecting the rich.”

But something went wrong on the way to the parade.

As it turns out, the Senate will not vote on renewing the Bush-era tax cuts before the Nov. 2 elections, a spokesman for Majority Leader Harry Reid said Thursday.

The problem was not only a threatened GOP filibuster, but more significantly the fact that a number of Democrats in both houses, facing tough re-election battles, seemed reluctant to vote to increase taxes on anyone — including “the rich” — in the depths of an ongoing recession.

Such disarray within the Democratic ranks is either an indication of how desperate the party’s chances now look, or else an acknowledgement that a growing number of Democrats realize how economically crippling it could be to continue with the “tax-and-spend” agenda … or both.

As though determined to extend the uncertainty which all agree has contributed greatly to the economic downturn, however, Sen. Reid’s spokesman expressed determination to come back and raise taxes on “rich” business owners and investors after the elections.

“Democrats believe we must permanently extend tax cuts for the middle-class before they expire at the end of the year, and we will,” said Jim Manley, spokesman for Sen. Reid, in a formulation understood to imply: “and raise taxes on the rich, of course.”

Sen. Charles Grassley, the senior Republican on the Senate Finance Committee, criticized the decision to hold the tax hikes in abeyance until after Nov. 2 “Leaving people with uncertainty is a dereliction of duty,” he said.

This week, more than 40 House Democrats sent a letter to House leaders calling for extension of the lower, Bush-era tax rates of 15 percent on capital gains and dividends. Isn’t it curious, how politicians who’ve spent most of the past two years digging the private-sector economy into the deepest swamp seen in more than half a century, can suddenly have their economic thinking clarified by the approach of an election?