The liberals’ plan: Gut defense and tax, tax, tax | Byron York | Politics | Washington Examiner

The pundits are fond of saying that Republicans are deeply divided over cutting federal spending. House Speaker John Boehner, the story goes, is barely able to ride herd on rowdy Tea Party freshmen, who want deeper cuts than House GOP leaders.

There’s been less discussion of the deep divisions on the Democratic side. How deep are those divisions? As President Obama prepares to reveal his budget priorities Wednesday, just take a look at a new document called the “People’s Budget.”

It’s the product of the Congressional Progressive Caucus, a group of the most liberal Democrats in the House. It’s not a small outfit; the caucus has 76 members, about 40 percent of the 192 Democrats in the House. Many are quite prominent and some were until recently in charge of the most powerful House committees: Reps. Barney Frank, John Conyers, George Miller, Charles Rangel, Rosa DeLauro, Jerrold Nadler, Louise Slaughter and others.

In other words, the Progressive Caucus — about three times bigger than the moderate Blue Dog Coalition — is no fringe organization.

The “People’s Budget” is the liberals’ answer to House Budget Committee chairman Paul Ryan’s 2012 budget proposal, which is “leading us down a road to ruin,” according to caucus co-chairmen Reps. Raul Grijalva and Keith Ellison. The “People’s Budget,” Grijalva and Ellison claim, would eliminate the deficit in just 10 years (Ryan’s plan would take more than 25 years) while expanding, not cutting, Medicare, Medicaid and Social Security. “This budget saves the American people from the recklessness of the Republican majority,” Grijalva and Ellison write in a letter to Rep. Chris Van Hollen, senior Democrat on the House Budget Committee.

How can such fiscal miracles be accomplished? By tax increases that would make even some top Democrats gasp. Perhaps the most extraordinary is the caucus plan to raise the Social Security tax to cover nearly all of a taxpayer’s income. Right now, the tax is imposed on the first $106,000 of earnings. For people who make more than that, the caucus would tax a full 90 percent of income — no matter how high it goes. The caucus would raise the Social Security tax that employers pay as well.

The caucus would create three new individual tax brackets for the highest incomes, topping out at 47 percent. It would also raise the capital gains tax, the estate tax and corporate taxes. It would create something called a “financial crisis responsibility fee” and a “financial speculation tax.” And of course it would repeal the Bush tax cuts.

As if anyone needed reminding, the “People’s Budget” is proof that the liberal idea of budget balancing is tax, tax, tax. If you’re looking for spending cuts, you’ll find just one really big one: national defense. The liberals would end “overseas contingency operations” — the wars in Iraq and Afghanistan — starting in 2013. They would save more money by “reducing strategic capabilities, conventional forces, procurement, and research & development programs.” In other words, they would gut the United States’ ability to defend itself, today and long into the future.

What would the liberals spend money on? The “People’s Budget” is essentially a newer and bigger stimulus bill. Grijalva and Ellison pledge to “invest $1.45 trillion in job creation, early childhood, K-12 and special education, quality child care, energy and broadband infrastructure, housing, and research and development,” along with billions more for stimuluslike road and other transportation programs.

Overall, the plan shows the gaping divide between the Progressive Caucus and the Obama White House. Back in his Chicago days, Barack Obama might easily have signed on to something like this. Now, as a president desperate for the support of independent voters in 2012, he can’t.

Instead, the president will deliver his spending priorities this week in terms of deficit reduction, because that is what independents want to hear. But by doing so, Obama risks further irritating an already-anxious Democratic base.

Some strategists will argue that the “People’s Budget” is good for Obama because it lets him position himself responsibly between what he will call the excesses of Ryan and the Progressive Caucus. But caucus members make up a big portion of the president’s support on Capitol Hill. Obama needs their constituents — the caucus represents more than 50 million people — not just to be on board but to be enthusiastic in 2012. The “People’s Budget” just makes Obama’s job tougher.

Byron York, The Examiner‘s chief political correspondent, can be contacted at His column appears on Tuesday and Friday, and his stories and blogposts appear on

The liberals’ plan: Gut defense and tax, tax, tax | Byron York | Politics | Washington Examiner

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