The election is over - but the campaign continues

Republican Speaker of the House John Boehner (left) and President Barack Obama at the White House 16 November 2012 The White House has said the president will not agree to a deal that extends tax cuts for the wealthiest Americans

US President Barack Obama is banging home a single message this week - that Republicans should go along with tax cuts for "ordinary Americans" before Congress gets around to any other business.

On Monday, the White House issued a report claiming if they did not buy this it would cost everyone more than $2,000 (£1,248) a year.

Today, Tuesday, the president meets owners of small businesses. On Wednesday he will be in the White House with "middle-class Americans". On Friday he will go to Pennsylvania to visit a business.

President Obama is preaching hard from the bully pulpit. Teddy Roosevelt once said the main power of the president was the "bully pulpit" - meaning a terrific platform for advocacy rather than using moral strong-arm tactics - but either interpretation fits what the president is doing like a glove.

'Suicide pact'

It is almost as though the election campaign never stopped. But now he is spending the capital he earned by winning.

This is all part of the struggle on the edge of the so-called "fiscal cliff". It is a horrible term, but what it means is a sort of suicide pact between Republicans and Democrats.

What is the fiscal cliff?

  • Under a deal reached last year between President Obama and the Republican-controlled Congress, existing stimulus measures - mostly tax cuts - will expire on 1 January 2013
  • Cuts to defence, education and other government spending will then automatically come into force - the "fiscal cliff" - unless Congress acts
  • The economy does not have the momentum to absorb the shock from going over the fiscal cliff without going into recession

If they do not agree to cut the deficit by 1 January 2013, then automatically there will be tax rises and spending cuts that will dismay both parties, and more importantly, would probably send America into a new recession, dragging the world economy with it.

It would certainly curb America's budget deficit, but only by ushering in what the Washington Post's wonkblog calls "an austerity crisis".

It was meant to concentrate minds on finding a solution, but the cure is almost certainly worse than the disease.

So, what is the president playing at?

It is highly unlikely the Republicans will give him what he wants. If they agree to "middle-class tax cuts", the fiscal cliff would still loom.

It is true the drop off the edge would become a little shorter, and a little less painful, but it would still hurt a lot and they would have agreed to hand over a major bargaining chip without getting anything in return.

So this looks like the president playing at a fairly brutal long-term political game - continuing to paint the Republicans as caring only about the rich, unwilling to help ordinary Americans.

It is hard to see how this makes it any easier to get an agreement in the next few weeks.

At the moment, this is fairly esoteric. But it matters. It starts to tell us how the president will play the second term, whether he will try to be a bridge - a conciliator - or use his new mandate to push his own distinct agenda.

And it matters because if he or the Republicans do misjudge their brinkmanship, it won't be just them tumbling off the edge - they could take the rest of us with them.

Mark Mardell Article written by Mark Mardell Mark Mardell Presenter, The World This Weekend

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  • rate this

    Comment number 185.

    Why do people act as if there was only 1 election? There were at least 467 Federal Elections, and the Republicans won 279 of them. Americans voted for more of what they've had for the last 2 years.

  • rate this

    Comment number 184.

    Curt Carpenter (180),

    "... There is surely some level of tax increase -- on everyone -- that would be equitable AND spare the world another deep recession."

    Very true, but that is unlikely to happen.

  • rate this

    Comment number 183.

    walleye... you did not address Obama's tax hike on the top 2%, as the panacea while the CBO says will not make much a dent in the debt. Your intellectual depth mirrors that of the shallowing bay of pigs. I would guess you are an entitlement net taker rather than a generous giver as I am.

  • rate this

    Comment number 182.

    177. usa-reality

    Well how about the fact that the U.S. economy was doing just find in the 1950's and early 1960s with a top marginal tax rate of ~90% and many more tax brackets.

  • rate this

    Comment number 181.

    169 ‘a community organizer is a shake down artist’

    A community organizer is a community organizer
    A shake down artist is a shake down artist
    A lie is a lie
    A defamatory groundless smear is a defamatory groundless smear
    A Romney is a failure
    President Obama’s re-election is something you can’t stand. Tough.

  • rate this

    Comment number 180.

    Personally, I would favor a cap on deductions & a progressive increase in taxes for ALL Americans. I really believe that we are, after all, all in this together, and that each of us should bear some fair share of the burden of fiscal irresponsibility past.

    There is surely some level of tax increase -- on everyone -- that would be equitable AND spare the world another deep recession.

  • rate this

    Comment number 179.

    169 ‘I know you are too narrow minded to listen to the other side of an issue. you probaly (sic) also think the news reports of RT are accurate.’

    Your lecturing others on their being narrow-minded is beyond satire. I have never seen RT. I'm not the one who pontificates on how Fox is the only fair and balanced TV station and much more objective than the BBC. Not on this planet it isn't.

  • rate this

    Comment number 178.

    154. Bengalman ""send America into a new recession, dragging the world economy with it."

    Needs to happen."

    You remind me of a tea party "community organizer" who claimed he would have preferred another Great Depression to the Stimulus.

    A serious lack of understanding of the suffering caused by the Great Depression -- try Reading "Grapes of Wrath" to get a feeling for it.

  • rate this

    Comment number 177.

    Hungerywalleye .... maybe you you should try to explain how the tax hike on top earners will help. It will fund Gov. spending 8 days. I'll be happy to have a 2% tax hike if we limited our national debt which the CBO says a the tax hike on top 2% will not do. Speak in facts please and get clue regarding finances whether small business or federal deficit spending.

  • rate this

    Comment number 176.

    167 Bengalman ‘Copying and pasting my words makes you appear more intelligent than you are.’

    No; my copying and pasting your words – eg ludicrously inaccurate predictions, assertions of fact that are blatantly untrue – makes you look exactly as intelligent as you are.

  • rate this

    Comment number 175.

    171. usa-reality What an ingenious idea -- only Liberals should pay taxes while conservatives send us off into trillion dollar wars. But heaven forbid the government rebuild our aging infrastructure or invest in education, research and protecting the public from predatory and polluting businesses. The poor oppressed 2%. Lets all hold a pity party for them.

  • rate this

    Comment number 174.

    163. MagicKirin "You two do know this 250K also refers to owners of small business before expenses?"

    If you check with AndreaNY the tax accountant, I think you will find taxes are based on net income, after expenses. You might try doing your taxes by hand next time and actually see how they are computed. You also might get a clue as to what marginal tax rate means.

  • rate this

    Comment number 173.

    While it's highly unlikely that the Republican Norquist fringe will give the President what he wants, it's also highly unlikely that the President can give that fringe what THEY want.

    So the real, crucial question is: can a compromise be struck that disgusts both parties equally? Which is to ask: is the the U.S. government terminally dysfunctional, or not?

    We'll see. I'm optimistic.

  • rate this

    Comment number 172.

    164 Bengalman - so the revenue went up and so did the credit card tab. Remember those off budget wars?

  • Comment number 171.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 170.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 169.

    ref #166

    I know you are too narrow minded to listen to the other side of an issue. you probaly also think the news reports of RT are accurate.

    But a community organizer is a shake down artist

  • rate this

    Comment number 168.

    165.Ton Load

    True Americans living & working abroad are "liable" for US income tax. But is it collectible or was it reported to the US IRS? An American working abroad, complying with the law, can take credit for taxes paid to other governments against their US income tax.

    What is the biggest business for US street gangs? Hint – not illegal drugs. A. - ID theft and tax fraud

  • rate this

    Comment number 167.


    I'm glad to see you save my words. Copying and pasting my words makes you appear more intelligent than you are.

    BTW...That quote by me was a wishfilled, hopeful prediction not a statement of known fact.

  • rate this

    Comment number 166.

    163 ‘And johny boy Romney cares far more about working people than a shake down artist from Chicago’

    Shakedown is defined as ‘Extortion of money, as by blackmail’. Since you've no evidence Obama is guilty of this, you’re merely indulging in tedious and defamatory smears-again.

    And you do know you can parrot sub-Fox opinions as facts for another 4 years and never convince anyone?


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