By
MSNBC TV
updated 7/31/2013 12:46:20 AM ET 2013-07-31T04:46:20

President Obama unveiled a new "grand bargain" on jobs today. The only problem: only one side is willing to bargain.

President Obama unveiled a new “grand bargain” on jobs today. The only problem: only one side is willing to bargain.

Hours before the speech was delivered, Senate Majority Leader Mitch McConnell slammed the proposal as something that ”doesn’t exactly qualify as new, it’s just a further left version of a widely panned plan he proposed two years ago, this time with extra goodies for tax-and-spend liberals.” Speaker John Boehner’s office joined in, claiming that the still unreleased plan leaves “small businesses and American families behind.”

These may sound like standard talking points for Republican leaders, except that the proposal is nearly identical to a plan Republican leaders have been pushing for years. McConnell has been longtime advocate of lower corporate tax rates. In 2011, McConnell sounded hopeful that corporate tax changes were something both parties could agree upon, telling CBS’s Bob Schieffer that “there’s a pretty strong bipartisan feeling that that would be a very good thing for the country.” McConnell reiterated his view last July on Fox News, telling host Greta Van Susteeren, “We ought not raise anybody’s taxes and the end of the year and use that year to begin to rationalize the whole tax code, which really needs it.” Boehner has made corporate tax reform such a priority that he made it the first bill House Republicans introduced this session of Congress.

Of course, this would not be the first time Republicans reversed their position after President Obama agreed to it. From cap-and-trade to health care reform to disclosing campaign donors, Republicans have spent the past five years opposing policies they once championed as soon as the president supports them.

But as Ezra Klein pointed out today on NOW, by presuming a policy needs bipartisan consensus to be taken seriously, we ignore whether or not the proposal is a good idea in the first place. President Obama’s bargain adopts a Republican proposal that would allow U.S. companies to pay no U.S. taxes on profits earned overseas. As the Center for American Progress points out, this would discourage job creation in the U.S and force small businesses and individuals to foot the bill for overseas profits. Contrary to Mitch McConnell’s talking points, the effective corporate tax rate (the amount companies pay after deductions) in 2012 was just 12%, the lowest recorded level in 40 years, and well below the tax rate many middle class families pay. Because our corporate tax code is full of loopholes and giveaways, the average corporate tax rate is the second lowest among our competitors in the G8.

Republicans may not have agreed to the President’s latest bargain, but they have proven once again that obstruction is the best way to get what they want.

Video: Obama will give economic speech at an Amazon warehouse

  1. Closed captioning of: Obama will give economic speech at an Amazon warehouse

    >>> in just a few hours, president obama is set to make stop number four on his great american economic road show . this afternoon the president will be at an amazon warehouse in chattanooga, tennessee where he's expected to drive home themes of income inequality , upward mobility and livable wages, ones that featured prominently in his last three speeches.

    >> i am going to keep making the case that we need to raise the minimum wage because it's lower right now than it was when ronald reagan took office. it's time for the minimum wage to go up.

    >> if the notion of fairness has close to zero chance of catching fire with congressional republicans , the president's focus on progressive priorities has impressed many. this bit of uncensored advice -- it's your moment, obama -- don't blow it. if obama keeps up with the aggressive progressive posture, he can reframe the way we talk about economic issues for the past 30 years. this afternoon in tennessee the president is expected to lay out a new proposal, a grand bargain for middle class jobs. it will include a plan to cut the 35% corporate tax rate while raising revenue from still unspecified corporate loopholes to pay for new infrastructure spending. grand bargain? cutting tax rates ? that's maybe the something the gop could play ball on. right? wrong.

    >> the policy intends to announce doesn't exactly qualify as news. it's just a further left version of a widely panned plan he already proposed two years ago. this time with extra goodies for tax and spend liberals.

    >> extra goodies. speaker boehner's office, 19 days after passing a farm bill that eliminated funding for food stamps , assessed the president's proposal to be one that leaves small businesses and american families behind. worth noting -- this is the same speaker of the house who shot down a minimum wage increase earlier this year calling it "a job killer." after thumbing their noses at the president's offer this morning, house republicans are now returning to their main legislative priority -- a 40th vote to cripple president obama 's health care law . joining me today, political editor and white house correspondent at the huffington "post," sam stein, also an msnbc contributor. melissa harris-perry, host of "the melissa harris-perry show," chief national correspondent at "new york times" magazine, mark liebowitz, author of "this town," and contributing writer for "the nation, ari berman. ezra klein , let's talk first about that thing you loathe to talk about -- policy. and specifically the president's version of a grand bargain which is not of course is a grand bargain in the sense we've talked about it but his version of something 345ib tthe two parties could come together. what do you think of the offer on the table?

    >> this is a smallish bargain. right? it is part of tax reform and it is a modest but significant set of jobs proposals. look, i think that this in a normal world would make a lot of sense. right? progressives don't like the corporate tax reform approach obama 's put forward and the reason is, it doesn't raise any taxes on corporations. so far the obama administration has said if we are going to raise taxes we are going to do it on wealthy individuals. we will not do it on the corporate side. but one of the things that happens when you do the kind of tax reform we are talking about -- it is really worth noting, this is true in the republican proposal , too, the one released by congressman dave camp . because you bring all of this money back overseas. it's been sort of sitting there waiting for some kind of special deal to bring it in. there is typically a fee on some of that money. can you put that fee toward deficit reduction, as the republicans do towards lowering tax rates or towards infrastructure, job retraining and a couple other things. that's right there what the obama administration is attempting to do here, say look, we will do the thing republicans tell us we can all do together, revenue neutral corporate side tax reform , leave out the original tax reform and use the proceeds of this money to do a little bit of infrastructure rebuilding and things like that. it shouldn't be a huge lift in congress , in this case of course it is probably doa. but that i do think is one of the problems we discuss this. right? it is the first day. we immediately talk about what john boehner said about it and it's just gone. it sort of omits the entire conversation over whether or not these proposals even make sense anymore.

    >> the fact that it shouldn't be a heavy lift but it presumed doa is sort of what it's sort of come to in congress , vis-a-vis any kind of rational, reasonable, maybe bargain. regarding the subject of corporate tax reform , it's touted as something that both sides want, but matt makes a point, "there's no coherent vision of reform that has broad business support. there's instead vague sympathy for the idea of locking in a low rate that could be achieved in a revenue neutral form by eliminating all deductions, then adding back in all the broadly supported deductions but that again is just another way of saying business leaders want lower taxes on businesses. the apparent consensus in favor of reform is a peer and tracks. theoretically their taxes are going to o go down but when it comes down to it, they could end up paying more to the federal government .

    >> i'm inclined to agree with that. there are a couple words here that end up alighting an enormous amount of the debate. revenue neutral means it will not change the amount of money it actually raises. right there you are saying you aren't giving on average citizens a tax cut . they won't be on board with this because they are getting a tax cut . then we have these wonderful terms -- loopholes, exclusions. people hear them an think these are horrible bad things in the tax code , special interests , special pleading . but actually one man's loophole is another man's incredibly important tax great which is what's keeping their business alive. when you talk about the big ones on the table here, things like whether or not businesses can deduct interest. right? that is a policy question. it is a difficult policy question and if you decide it in a different way than it is decided now, it creates a lot of losers. this is always the very big problem of corporate tax reform or individual tax reform which is that the people that are going to lose out on it always scream louder than the people who maybe will get helped a little bit from it. and so there is this kind of idea in washington that republicans want to do it and democrats want to do it. what we have not seen yet is whether or not either side wants to do it enough to walk through the really, really hot coals of actually going forward on this issue. at the moment you just don't see a lot of interest from republicans in doing it in a way that would protect the other side. right? this idea of sort of both sides holding hands and jumping. people have an ideological interest in it, they like the idea of doing it, they like the idea to be able to agree on something but they aren't even getting to the point in the process. the beginning negotiations where you would even begin to see how loud the screaming from the losers in the corporate community would be.

    >> melissa , as folks have said, we are not -- this is not a serious offer, blah blah blah . i actually think even if nothing happens here, the fact that the president is at least trying to shift the goal posts a little bit towards a more progressive vision for the country, to talk about infrastructure spending, and education and universal pre-k and the minimum wage ? i mean that does change the sort of frame of reference by which we have been having this debate over our country's fiscal health. it also gets us off of, for however long, this belt tightening, budget deficit , distraction or obsession or whatever you want to call it that the republicans have effectively made dominant in the national conversation .

    >> well, the republicans , but with some help from the president who was a deficit hawk from the beginning, sort of never questioned that. and so i think what you're laying out here is the most depressing and perhaps most hopeful term for the second term presidency for president obama in the context of the economy. if this is going to be a political question where you simply are not going to be able to move, where the republicans still see at least in their short term interests kind of utter obstructionism as their best political alternative. then the last thing the president has left is the bully pulpit . right? it's actually not the last thing. he's got a fed chairman he'll be able to put in that will make important differences leer. there are other kinds of constituencies but vis-a-vis congress , simply saying inequality is the key issue, growth from the middle out, and sort of trying to reframe the notion of -- for example, what a minimum hike does. if you ask folks what a minimum wage hike does, the first impulse is to say it kills jobs because businesses won't hire as much rather than saying $5 more in the person's pocket is $7 spent.

    >> ezra -- i'm quoting ezra . ezra called it a hugely popular --

    >> he made a good point, that guy.

    >> whoever that guy is. he writes a lot and knows a lot. a hugely popular and i would argue necessary. the average age after fast food worker in the u.s. is 29 years old. we are no longer talking about teens and high schoolers when we talk about minimum wage workers. we are talking about people with families, grandmother's. you think that it is interesting that the president is at amazon, right? because on one level, as matt ig gl iglesias points out, it is good to pump that into hiring as opposed to just sitting on the profit. but on the other hand, you have to ask yourself, are those good jobs. i read and excerpt from "the new republic," some of those jobs coming back to the country from china or canada or where are are coming back but at wages far below what they were paying before they left. are we cool with that? the administration is undoubtedly wrestling with this behind closed doors .

    >> sure. in a becauwhite house call previewing the speech, they said we're not in the business right now of scoffing at any job creation . a job is a job and we understand that people appreciate the chance to make a living even if it is of a lesser means variety. and i understand why they feel that way. they want to put people back to work. if i were an obama supporter, i would be depressed at this point at how many few chipsvy pleft to play. the corporate tax reform was one. and it is clear if you attach even relatively modest tool. if i were an obama supporter and saw the reaction to his proposal this morning i'd be very upset with it.

    >> so mark, should supporters of the president, should believers in the democratic process , be depressed that this is sort of the state of affairs ? the president puts forward something that shouldn't and heavy lift . it is immediately shot down by senior leadership in that republican party and is presumably going to go nowhere.

    >> yes. they should be absolutely depressed. everyone watching this should be depressed. i personally am depressed. i'm serious. sorry. i mean the fact that ezra can like begin his statement quite correctly and say in a perfect world --

    >> or normal world.

    >> normal world. even in a low yield world. we could get something of substance done here. and then we can go on and we can talk all kinds of sense to each other, and then know that really we aren't dealing in a normal world is depressing. you see the reflects of kabuki going back and forth. we all know how it will end legislatively or non-legislatively, frankly. i think if you talk to rational democrats and rational republicans they could come to some deal in a vacuum on corporate tax reform . this is not a vacuum. they have their leadership to contend with. they have loblobbyists, med terms. there is a large check and balance.

    >> congress has done nothing to pass jobs since 2009 . it's been a long time. we've been in an economic crisis for a while now. to the extent we have an economic recovery it's happening in spite of the congress , not because of them. and the economy is getting better. there is a lot of good signs but it just kind of is amazing that congress is just completely awol when it comes to what should be one of their responsibilities.

    >> and to create jobs, say get rid of the sequester which the cbo says will bring back 900,000 jobs or passing immigration reform , they are actively standing in the way.

    >> we also shouldn't let off the hook here states. right? so congress is sort of one source of the madness around jobs but the other part of it are these republican governors in states where we kept seeing sort of this growth of private sector jobs at the same time that they kept shrinking government sector jobs while saying government doesn't create jobs, when in fact actually it does. it creates government jobs . most of which pay --

    >> part of it is because states have to balance their budgets. it is a fact of life but you're right, this idea that you can't stimulate the economy through government spending is sort of a fallacy. it's been proven in statistics. we've just for three years now basically abandoned the idea.

    >> ezra , before we let you go. we have a post from a piece you did in february which is a graph which you call the best argument for raising the minimum wage which basically shows corporate profits against the minimum wage which is effectively stagnated. is there hope the president can beat the drum on this and maybe move us -- move congress , which has not raised the minimum wage since i believe 2007 ?

    >> yeah, i think there is hope. i think the year you just mentioned is why there is hope. who was in charge in 2007 ? it was president george w. bush . what happened is the democrats began pushing a minimum wage increase a couple years prior in the 2006 election. it was one of the -- as we talked about before, the real cudgels they used in the election to win back the house, to win back the senate. it was used very effectively in states where it was on a number of ballots. when they got back to washington in 2007 , the republicans kind of just said -- and president george w. bush just said, fine, why don't we just get this one off of the table. typically that's how these minimum wage increases go. so i'm not hugely optimistic on the minimum wage chances before 2014 but if in 2014 it is used effectively and it becomes not as good an election for the republicans , that's the kind of thing that in the past in previous republican parties that's not always a great predictor now, but in previous republican parties they've decided to say we don't hate this that much, we can live with it.

    >> our abnormal congress . "the washington post 's" ezra klein , thank you, as always, for the insight.

Discuss:

Discussion comments

,