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On Tax Cuts, Liberals Wanted Obama to Fight

As a final tax package with perks for the wealthy comes into focus, liberal Democrats appear to be the losers in President Barack Obama’s first major post-election deal, a trend that they may have to get used to in the next Congress.

“We’re still the majority,” said an aide for a prominent House liberal. “If Obama’s doing this to us now, wait until January.”

Liberals have been on the sidelines as Congressional leaders and Obama hammer out a bipartisan deal on extending the Bush-era tax cuts before they expire at the end of this year. Details on the final package are still being finalized, but Democratic aides said all parties have agreed to the most contentious aspect of the bill: a two-year extension of all the Bush tax cuts, including those for the wealthiest taxpayers.

“We cannot play politics at a time when the American people are looking to us to solve problems,” Obama said Monday night, during remarks that outlined the deal. He said while he disagrees with “giving tax cuts to millionaires and billionaires,” passing them temporarily is the only way to ensure that middle-class families don’t become “collateral damage” in a prolonged political battle over tax cuts.

Liberal lawmakers said they are stunned by Obama’s willingness to concede so quickly to GOP demands that people who make more than $250,000 keep lower tax rates, an idea that Democrats and the president have railed against for months.

“I don’t like this at all,” Rep. Jerrold Nadler (D) said. “The president has not put up much of a fight.”

The New York lawmaker said Democrats should be the ones taking a stand and “playing chicken with Republicans, not the other way around.” He added that Obama should take a cue from President Bill Clinton, who, in 1995, refused to cave to GOP demands that the budget include major cuts to entitlement programs, forcing the government to shut down in the standoff. After a few weeks, Republicans backed down and Clinton passed the budget that he wanted.

“The question is if Obama has the same nerve that President Clinton had,” Nadler said. “It doesn’t look promising.”

Rep. Anthony Weiner, one of the most outspoken liberals in the House, took to Twitter to air his frustrations with Obama on the issue: “Memo to our President: Why are we always punting on 3rd down? Lets get our offense on the field.”

The New York Democrat later criticized the president for compromising core Democratic principles in his deal with Republicans.

“Democrats should welcome the chance to tell the American people what we will fight for. We should be standing up for the middle class and extending unemployment insurance for out-of-work Americans. If Republicans want to add to our deficit and defend the interests of billionaires, make them stand up in Congress and tell that to the public loud and clear,”Weiner said.

A House Democratic leadership aide said a number of liberal lawmakers “totally agree” with Weiner’s take on the issue but can’t be as vocal about it because, without Obama firmly against upper-income tax cuts, they would take heat back in their districts.

“If they had some cover from the White House, they could have a better debate,” the aide said.

Liberal activists have launched attacks on Obama over the issue. The Progressive Change Campaign Committee, which boasts a membership of 650,000, sent an e-mail to supporters Monday that quotes former Obama campaign staffers expressing frustration with the president.

“If he capitulates on this, there really is no point in voting for him in 2012. The difference between voting for a Republican and voting for someone whose default negotiation strategy is rolling over and dying whenever the Republican Party says mean things is marginal,” Daniel Roche, a 2008 Nevada field organizer for Obama, says in the e-mail.

Only in recent days has Obama been talking openly about the need to compromise on the issue. His signature argument has shifted from opposing tax cuts for the wealthy to ensuring that middle-class tax cuts do not expire.

“We’ve got to make sure that we’re coming up with a solution, even if it’s not 100 percent of what I want or what the Republicans want,” the president said Monday in North Carolina.

Some senior Democratic aides defended Obama for staying focused on keeping the middle-class tax cuts in effect.

“I think that it’s about time we get used to the fact when the votes aren’t there in the Senate for what we want to do, we have to compromise. And on this, it is better to compromise before we get blamed for raising taxes for every American,” a senior House Democratic aide said.

A senior Senate Democratic aide was more pointed when asked whether the Democratic base should get used to being on the losing side of deals cut in the next Congress: “Unfortunately, yes.”

The scuffle over taxes isn’t the first time that Obama has upset liberals since the Nov. 2 elections that handed Republicans firm control of the House and an expanded minority in the Senate. He drew fire from critics of free-trade deals last week when he announced a final deal on the South Korea trade pact and signaled that he will send the Bush-era agreement to Congress in the coming months. The president also angered liberals by announcing a federal pay freeze for the next year that will save the government $2 billion.

The message being sent by the pay freeze is that the deficit is “caused by the government, which is not true, and that we can cut our way out of this and that we ought to cut our way out,” one liberal House Member said. “It’s contributing to the wrong narrative ... and giving a signal to the private sector, which is only too eager to follow this.”

All that’s left from here, this lawmaker added, is seeing how Speaker Nancy Pelosi (D-Calif.) plans to sell the tax deal to the Caucus tonight.

“We’ll see what kind of stand we’re going to take,” the House Democrat said. “But ultimately, the president takes the stand.”

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