The battle over the US deficit is not over yet

Obama puts tax rises back on the table - but will his words be matched with action?

 

In the aftermath of a last-minute deal to raise the US debt ceiling, Barack Obama has hinted that tax rises may be back on the agenda.

The immediate crisis of the US potentially defaulting on its debt was averted with a last minute deal, but politicians on both sides of the debate are still unhappy. Much of the attention has been focused on the intransigent Tea Party faction of the Republican Party, but it would be wrong to under-estimate the anger among Democrats.

Many feel that Obama capitulated far too much ground, agreeing to huge scale cuts in public spending.

While Republicans have insisted that the deal does not include tax rises, Obama said in a short statement that the national debt could only be reduced through a combination of spending cuts and tax rises, particularly for big corporations and the very wealthy. In a return to the rhetoric he entered the debt battle using, he said:

Everyone is going to have to chip in. That is only fair. That's the principle I'll be fighting for during the next phase of this process.

And fight he will have to, if he wants to get tax rises through. His attempt to end the Bush-era tax cuts last year triggered outrage and - once again - he relented, agreeing to extend them until 2012. Ending these enormous tax cuts is the obvious way to reduce the deficit (you can see here how much they contributed to the country's huge debt), but Obama may yet decide it is too risky so close to an election.

Putting tax rises back on the table in as serious way will reignite the ideological battle that brought America to the brink of default this week.
Indeed, many Republicans remain dissatisfied with the current deal, arguing that its spending cuts do not go far enough. Many Tea Party activists still oppose it, even though that their representatives successfully pushed the entire debate far to the right despite controlling less than half of one House ("I hate the deal," said Andrew Hemingway, chairman of the Republican Liberty Caucus of New Hampshire)..

Obama has already eloquently argued that those most able to pay should do their bit for deficit reduction, at the start of this battle. There is a clear ideological case to be made at the next election: that tax cuts for corporations and the super-rich should not be maintained at the cost of healthcare for pensioners. However, if his words are not matched by confident, decisive action, there is no point in reopening the debate. He has a lot of work to do if he is to shore up support among his own support-base, let alone the country at large.

 

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

Julia Rampen
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Donald Trump's inauguration marks the start of the progressive fightback

Opponents to Donald Trump and Brexit are reaching across the Atlantic. But can they catch up with the alt-right? 

In the icy lemon sunshine of 20 January 2017, a group of protestors lined London’s Millennium Bridge, drumming. Two scarf-clad organisers held placards that spelt “Open Hearts”. 

Protesting the inauguration of Donald Trump as the 45th US President might seem like a waste of time when you could spend the day under the covers instead. But the protestors were upbeat. Sophie Dyer, a part-time student and graphic designer I met on the bridge, told me her group were “trying to avoid mentioning his name”. 

When I asked her what had catalysed her interest in political activism, she said: “Everything. 2016.”

One of the trademarks of the times is the way the alt-right learnt from each other, from Donald Trump crowning himself “Mr Brexit”, to France’s Marine Le Pen sipping coffee at Trump Towers. Now, progressives are trying to do the same. 

The protestors were part of the Bridges Not Walls protests. Ten hours before I stepped onto the Millennium Bridge, New Zealand activists had already got started. As the sun rose over Europe, banners unfurled from bridges in Dubai, France, Spain, Sweden and Norway. In the UK, there were also protests in other cities including Edinburgh and Oxford.

The demonstrations are about Trump – the name is a direct rebuke to his pledge to build a wall on the southern border – but they are no less about Brexit, or, as environmental campaigner Annabelle Acton-Boyd put it, “right-wing populist movements”. 

Acton-Boyd said she had come to show solidarity with American friends who opposed Trump.

But she added: “It is about coming together supporting each other geographically, and across different [political and social] movements.” 

In the election post-mortem, one of the questions confronting progressives is whether voters and activists were too focused on their own issues to see the bigger picture. This varies from controversial debates over the role of identity politics, to the simpler fact that thousands of voters in the rustbelt who might have otherwise helped Clinton opted for the Green candidate Jill Stein.

But while Bridges Not Walls paid homage to different causes - LGBTQ rights were represented on one bridge, climate change on an other - each  remained part of the whole. The UK Green Party used the event to launch a “Citizens of the World” campaign aimed at resettling more child refugees. 

Meanwhile, Trump and his European allies are moving fast to redefine normal. Already, media critics are being blocked from presidential press conferences, divisive appointments have been made and the intelligence authorities undermined. 

As US opponents of Trump can learn from those in the UK resisting a hard Brexit, resisting this kind of right-wing populism comes at a cost, whether that is personal infamy a la Gina Miller, or the many hours spent dusting off books on constitutional law. 

The question for transatlantic progressives, though, is whether they are prepared to leave the morning sunshine for the less glamorous elbow grease of opposition – the late night email exchanges, the unpaid blog posts, the ability to compromise - that will be needed to bend the arc of history back towards justice. 

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.