Even as both parties retreat to their partisan corners about what to do with the expiring Bush tax cuts, it is still possible to have this solved with some legislative deal making.


When you think about it, there are only a few things that can happen.

The Republicans could back off their call for an extension of the Bush tax cuts to all taxpayers.

The Democrats could back off their call to extend the Bush tax cuts only to those who earn less in a year than $200,000/individual and $250,000/family, in other words, not to top earners.

Or, there could be some kind of deal between the two parties and the White House.

Right now, the momentum politically is all flowing towards the Republicans.  They don't fear the class warfare argument of the Democrats, that the GOP is "holding middle class tax relief hostage" by refusing to accept a tax increase on the rich.

On the other side, over three dozen Democrats have made clear that they don't want to follow their leadership, and would support an extension of the Bush tax cuts for all income levels.

That means Democrats don't have the votes right now to do what the White House wants.

So, do they offer to accept a deal where all the Bush tax rates would stay in place, but taxes for the rich would go up in two or three years?  What about a plan where they would raise taxes only on millionaires?

Democrats in the House don't want to go first - they want the Senate to pass something before going on the record.

If that's really the case, then maybe nothing gets done on this until after the elections.

Or, as I've been warning, maybe nothing at all gets done by the end of the year, which would mean a tax increase for all.

Some Democrats want a vote, no matter what, before the elections.  Even if it means they lose.  We'll see what happens this week.