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Brent Budowsky

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Republican Payroll Tax Disaster

Posted: 12/23/11 06:02 PM ET

As President Obama and Democrats battle during this holiday season to enact a tax cut for the 99 percent of Americans who constitute the heart of the nation, House Republicans are making a seismic political blunder reminiscent of the self-destructive overreaching of then-Speaker Newt Gingrich (R-Ga.) that rejuvenated the Clinton presidency during the 1990s.

The GOP House should pass the bipartisan Senate compromise to continue the payroll tax cut and jobless benefits that was supported by President Obama, 89 senators -- Senate Democrats, Senate Republican leaders, a strong majority of GOP senators -- and House Democrats.

The House GOP payroll tax fiasco comes at a critical inflection point for the American economy and for the 2012 campaigns.

Recent economic data points suggest a potentially important uptick in economic growth and job creation. Failure to extend the payroll tax cut and jobless benefits will cause an economic setback and would be the equivalent of an attack against economic growth, job creation, consumer confidence, business confidence and public confidence by a House GOP that acts like the prisoner of a far-right faction at the expense of the nation as a whole.

It would be economically destructive and politically disastrous for Republicans to tell jobless Americans that their benefits will not be continued after the holidays, and to tell 160 million American workers that their taxes will rise at such a precarious moment of economic hardship.

Republicans should have agreed to extend the payroll tax cut for the full year and accepted a very modest surtax on wealthy individuals with incomes above $1 million.

This equitable solution is supported by an overwhelming majority of Americans. It was rejected by GOP legislators who vehemently oppose even minimal sacrifice by the wealthiest 1 percent, who damage the well-being of the other 99 percent of the nation and who promote grossly unfair and highly unpopular economic disparities that are now the hallmark of Republicans in Washington and the calling card of their campaigns in 2012.

It is hard to conceive of an economic policy more harmful to the country, or a political strategy more damaging to the GOP, than the spectacle of hard-line ideology and partisan obstruction being imposed by House Republicans and endured in real time by Americans today.

President Obama and Senate Democrats made substantial good-faith compromises in the package that passed the Senate. Senate Republican leaders, and a large majority of GOP senators, had the good sense and good good faith to join with Democrats supporting the package that passed the chamber with 89 votes.

I have been willing at times to disagree with the president and Democrats. But I must say there is a political and economic cancer that is corroding the behavior of the House majority, which fails to learn either the lessons of the mistakes of Barry Goldwater in 1960, when he said that extremism was no vice, or the wisdom of Barry Goldwater, when he later became a great American statesman.

President Obama is gaining support because he is being favorably compared to Republican candidates who are hostage to rightist factions that are extreme by standards of historical Republicanism, and to a House GOP majority that is extreme and out of touch with mainstream America by historical standards of Republican leaders in Congress.

The president is trying in good faith to address the nation as a whole, while his partisan opponents are so obsessed with destroying him, and so consumed with their ideology, that they appear to be addressing only a faction that is a small slice of the nation rather than the big tent Americanism that Ronald Reagan and other presidents have historically sought to address.

My advice to House Republicans is to avoid repeating the mistakes made by Newt Gingrich when he overreached against Bill Clinton. Cut your losses, pass the Senate compromise, continue the battle next year and let Americans come together during this holiday season for a brief shining moment of good will, good faith and good sense.

This column was originally published at The Hill.