Dear President Obama,

Margaret Atkins MunroLet's Talk About MoneyLeave a Comment

Dear President Obama,

I want to express my gravest concerns regarding the proposed tax legislation currently pending before Congress. This legislation, which you negotiated with the Republican leadership without input from Democratic leaders in Congress, is a sell-out. In exchange for extending unemployment benefits, you’re in danger of strangling Social Security, taking a giant step towards making the Bush-era tax cuts permanent for everyone, expanding the annual deficit and the national debt, and increasing our obligation to foreign investors. Frankly, Mr. Obama, I am very disappointed.

First, let’s talk about Social Security. I appreciate that you want to continue giving immediate tax relief, and that cutting the employee’s share of Social Security by two percentage points (from 6.2% currently to prospective 4.2% beginning January 1) seems a reasonable way to replace the “Making Work Pay Credit”. But what will this large decrease in contributions into Social Security do to the long-term viability of this program? Is this the first step towards privatizing Social Security, and handing its management over to the very investment bankers who pushed this country to the economic brink a mere two years ago? The discussion surrounding Social Security should be how we make this program more financially viable, not less, but your proposal is, at the very least, a missed opportunity.

And then there’s the two-year extension of the 2001 and 2003 tax cuts, the very cuts which President Bush scheduled to expire in 2011. I appreciate that you felt obligated to extend those tax cuts to lower and middle income taxpayers, and that extending it to all taxpayers was the only way you could make good on your more modest proposal. Still, price tag for the full extension is large, and a largely unnecessary expansion of the deficit and the debt. Republicans have framed the expiration of these temporary tax cuts as the most significant tax increase in history; if this is true, then these were tax increases voted for by a Republican Congress and signed into law by a Republican president back in 2001 and 2003.

To make matters worse, you are cutting taxes at a time when the U.S. economy is so in debt to other countries that they are beginning to dictate the terms of our domestic and foreign policy. The amount of our debt owned by foreign countries, primarily China, is staggering, and you are proposing to increase it. Should these foreign powers decide that they’d rather invest in Canada, Mexico, or Europe, our goose may be cooked. I do not understand your rationale for expanding the size of our deficit and the amount of our national debt when almost all other developed countries are taking their lumps and instituting austerity budgets the likes of which have not been seen since World War II. If you think that your position regarding the Federal Reserve’s plan to buy $600 billion of bonds was unpopular at the last G-20 conference, try selling additional tax cuts at the next meeting of world leaders. You’re in danger of not even being allowed to sit at the grown-ups’ table.

I am very disappointed that you’re taking an extremely short-term view and ignoring long-term consequences. You’re treading a path that leads directly to codification of permanently lower tax rates without addressing the need for greater revenues. In the face of persistently high unemployment, you’re continuing to police the world, sending monetary and human capital to distant corners. We have very real need here at home, and we require a larger portion of our increasingly scarce resources to address them. But, apparently, we’re not ready to do that.

No one ever said that being President would be simple, but your job is to make these decisions. I appreciate that you are caught between a rock and a hard place, especially regarding the extension of unemployment benefits. I know that it cannot be easy to even entertain the idea that some families (or many families, in this instance) face the possibility of a cut-off of benefits just at the time of year when they are most needed. But you played a game of chicken with the Republican leadership, and you blinked first. There is no way that they would take the chance of being saddled with the authorship of benefit termination; they would have changed their tune fast enough if it appeared this were about to happen. But they threatened, and you caved, and you gave them everything they wanted.

On the basis of this one negotiation with Republican leadership, I have very serious doubts as to the progress, or lack thereof, which will happen over the next two years. The problems facing the country today will not magically disappear; the draconian austerity measures that European countries are currently instituting will become necessary here—the only question is when. The danger in postponing the eventual pain is twofold: delay only increases that pain’s intensity, and left too long, may prevent these United States from ever recovering.


Margaret Atkins Munro