Back Off Budget Bugaloo

Washington's mind was blown by Obama first budget. Of course, the journalists' focus was on the increase--in two years-- of taxes on those with taxable income of $250,000 and above. Even though Obama repeatedly talked about this during the primary campaign and in the general election,the media is still shell-shocked that he will end about three decades of favoring the wealthier among us. To keep this in perspective, only 2% of those owning their own businesses earn $250,000. And remember that's taxable income--after the deductions. So, we're talking about $350,000 gross income here. Which should tell you all you need to know about how and why your news is slanted. After all they all earn more than the $250,000.

The Obama Budget was brilliantly explained by his Budget Director Peter Orszag. But I think that's the problem. The budget and Obama's economic plans are inter-related in such a sophisticated way it is clear to me no one in Congress will understand them. Republicans complained no one had read the stimulus bill even though it was posted on the White House website and Huffington Post.com. I actually read both the House and final versions. So certainly someone on the Hill could have, should have read it. But sadly, it is true no one did. Most of the Republican complaints about earmarks for ACORN and other crimes against nature were simply false. You should expect the same for the budget.

The Obama Budget does have a basic problem of optics. It comes after the stimulus bill, the bank bailouts and the curious budget passed by the House. So there is a fair amount of money fatigue on both sides of the aisle. And I get people want a respite after going on a spending spree. While I like the whole symphony of the Budget, I think when the rubber meets the road that the Obama Administration should focus on the health care reform portions of it because once he secures that he's golden.

The Republicans find themselves in a fascinating political place. The party is on the record against the extension of unemployment benefits for out of work Americans but for tax policies that benefit only the extremely wealthy and corporations. What they haven't figured out yet that Obama took the lower, middle and upper middle classes away from them without a fight.

With the southern Governors publicly resist additional suport for the unemployed, it is going to look very bizarre the vigorous fight--which will happen--to preserve tax cuts for the wealthy. The Scream Machine will go into full throttle on this, trying to make the case that this is Obama's first step to increase everyone's taxes. First they took the yacht and I did nothing. Then they took the third house away and I didn't nothing. I always fear that they might bamboozle people into this.

The Kaiser polls are out on health care. It's clear that now is the time for Obama to move since nearly 60% of those polled believe what he says about the situation compared to 9% for the Republicans. Also, the vast majority of Democrats and Independents believe the time for health care reform is now. What Obama needs to do is make sure that Republicans can not succeed in the Billy Kristol strategy of stall and delay.