Analysis: GOP's struggle on taxes gives Dems hope
WASHINGTON—For all his problems with the economy, President Barack Obama is getting unexpected help from a Republican Party that seems incapable of capitalizing on its advantages.
Congressional Republicans' fumbling of the payroll tax extension issue is the latest example of party in-fighting and disarray that gives Democrats hope for the 2012 elections. GOP presidential contenders tried to distance themselves from the legislative mess. But they might be tarred nonetheless if swing voters decide the party is either inept at governing or too extreme.
The eventual GOP presidential nominee "will be somewhat shackled to the Republican brand," said Democratic strategist Erik Smith, even if it was Republicans in Congress who led the charge in an unpopular fight over the payroll tax. He said GOP House and Senate candidates will face even more problems.
The Wall Street Journal editorial page -- an important voice among conservatives -- berated Republican lawmakers for their handling of the payroll tax matter. Obama wanted to add another year to this year's reduction in the tax, which nearly all workers pay toward Social Security. Senate Republicans, after forcing Democrats to swallow several unrelated concessions, joined in an overwhelmingly bipartisan vote to approve only a two-month tax cut extension, with plans to revisit the issue next year.
House Republicans, who generally disliked the payroll tax cut from the start, refused to concur early this week. But House Speaker John Boehner on Thursday bowed to relentless criticism from conservative bloggers and several GOP senators and cleared a path for passing a bill Friday to renew the break for two months while congressional negotiators work on a longer-term measure.
If Congress doesn't act in the next 10 days, the payroll tax rate will return to 6.2 percent on Jan. 1, after one year at 4.2 percent. That would cost a family making $50,000 about $1,000.
Republican congressional leaders' actions "might end up re-electing the president before the 2012 campaign even begins in earnest," the Journal's editorial page said Wednesday.
Democrats point to episodes like the payroll tax fuss and say congressional Republicans are essentially controlled by tea party activists, whose tax and spending agendas are outside the political mainstream.
"Tea Party Republicans blocked a bipartisan bill to extend President Obama's payroll tax cut," the Democratic Congressional Campaign Committee said in a fundraising email Tuesday, minutes after a key House vote. House Democratic leader Nancy Pelosi told reporters, "The tea party tail is wagging the elephant."
Democratic strategists hope to remind voters of last summer's near-calamity over raising the limit on the federal debt ceiling. Then, as now, Boehner struggled to control his GOP caucus and to calculate which bills can and cannot pass. These Democrats want to paint the Republican Party as an out-of-touch institution that would rather stand for rigidly conservative principles than solve the nation's problems.
"I think the tea party-engendered dysfunction has the potential to really get the electorate's attention," said Jared Bernstein, a former Obama administration economist now with the Center on Budget and Policy Priorities. "At this point, the system is crippled by them."
All of this, of course, may be wishful thinking by Democrats. Republicans crushed them in the 2010 elections, giving the GOP control of the House and many governorships. Unemployment and other economic indicators bode badly for Obama's re-election hopes, and the payroll tax dust-up may seem a musty memory by next November.
One other worry looms. Americans' taxes still might rise by billions of dollars in 2012 if a deal can't be struck on a longer, one-year extension. Economists say that would depress spending and slow job growth, at least somewhat. Even if more voters blame Republicans than Democrats, Obama could end up as a net loser politically, given that the economic climate already is deeply troublesome for him.
GOP leaders say income tax cuts do more to stimulate economic growth than payroll tax reductions but worry about independents thinking it was Republicans who sought to raise their payroll taxes. At the same time, they know that hard-core conservative voters who have a bigger voice in GOP primaries might blame them for a tax cut they dislike.
Republicans may yet claim one political victory out of the payroll tax imbroglio, assuming the two-month extension goes through. In House-Senate negotiations they forced Obama to agree to an expedited decision on a proposed transcontinental oil pipeline opposed by environmental groups as part of the two-month extension.
The GOP still has a perception problem, though. Americans hold Congress in extremely low regard, but they put more blame on Republicans than Democrats.
A recent poll by the Pew Research Center found that a record-high 50 percent of Americans say the current Congress is less effective than most. By nearly 2-to-1, "more blame Republican leaders than Democratic leaders for this," Pew found. "By wide margins, the GOP is seen as the party that is more extreme in its positions, less willing to work with the other side to get things done, and less honest and ethical in the way it governs. And for the first time in over two years, the Democratic Party has gained the edge as the party better able to manage the federal government."