Obama Admin Throws Cold Water on Extension of Bush Tax Cuts for Wealthy

Last week The Washington Post suggested that the Democrats were buckling in their opposition to extending the Bush tax cuts for the wealthy, a move that, as I have written here before, wouldn't be good politics. Today, however, the Obama administration rebuffed the idea of increasing the deficit to put more money in the pickets of the rich.

An economic adviser to President Barack Obama said on Tuesday there was a worry that even a temporary extension of lower tax rates for the wealthy would be a "foot in the door" to permanent extension.

Jason Furman, deputy assistant to Obama for economic policy, backed on the president's stance to extend lower tax rates enacted under former President George W. Bush for lower- and middle-income groups only -- and not for wealthier Americans.

The messaging from the administration could be stronger here. For instance, the administration could point out (as did Ezra Klein today) that the cost of extending the Bush tax cuts for high income earners is virtually the same as the cost of plugging any potential holes in the Social Security program. That said, it is good to see the administration pushing back against the notion that they have to keep taxes historically low for the rich in order to reinvigorate the economy.