Democrats continue to demand more spending in deal to avert Obama tax hikes
President Obama and Colorado's Democrats in Congress apparently will agree to extend the Bush tax cuts and avert more Obama tax hikes only if Republicans agree to higher spending on extended unemployment benefits.
Extending the unemployment benefits will ensure high levels of unemployment for years to come. Too many of the unemployed make more by avoiding low-paying jobs and staying on the dole. If the benefits were cut, unemployment rates would soon dip. How much they would drop if benefits weren't extended is hard to predict. At least I haven't seen any predictions on what would happen if benefits weren't extended.
Both Democrats and Republicans are playing to their bases in the deal that Obama announced last night, which is subject to approval by hard left Democrats who control Congress until next year.
Republicans are reasonably assuming that averting the Obama Democrats' tax hikes and new tax cuts that will be part of the deal will help the economy more than the additional spending will hurt it.
The tentative agreement to exempt estate, or death taxes, on the first $5 million in an estate and then tax the balance at 35% looks like a pretty good compromise, too. Of course, it would be smarter to completely eliminate estate taxes, but the redistributionists make that politically impossible.
Compromise has made America the wealthiest country in the world, and it's good to see a little compromise after two years of Obama's way or the highway.