The Wall Street Journal is reporting that Barack Obama and the Democrats are adding up to $300 billion in tax cuts to their stimulus proposal, making the plan now 40 percent tax cuts. Some of these tax cuts, like speeding up the ability of businesses to write off losses and adding investment incentives, make sense. Others, like the human employment tax credit, less so. The move is being billed as an effort to peel off Republican votes.
Republicans should instead up the ante, using this latest concession to push more tax cuts and less spending. Barack Obama has already conceded that tax increases could hurt the economy, at least under present conditions. He has conceded that tax cuts can help. And he hasn’t done much to make sure that his tax proposals are realistically revenue-neutral. At the very least, these points need to be remembered when Obama and the Democrats move to raise taxes later.