Republicans Calling Democrats' Bluff on Bush Tax Cuts

Democrats dig in on the hill, vow to extend Bush Tax Cuts for the middle class, not the wealthy.

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Democrats on Capitol Hill are staking out a hard-lined position on the fiscal cliff this week and supporters of the pledge against tax increases are calling it a bluff.

Washington Democrat Sen. Patty Murray declared at a Brookings Institution appearance Monday that Democrats are not going to let Republicans extend the Bush Tax cuts on the wealthy, even if that means letting the automatic budget cuts on the nation's defense budget go into effect in January.

"If Republicans won't work with us on a balanced approach, we are not going to get a deal," Murray said. "So if we can't get a good deal, a balanced deal that calls on the wealthy to pay their fair share, then I will absolutely continue this debate into 2013 rather than lock in a long-term deal this year that throws middle class families under the bus." [Skeptics Doubt Planned Defense Cuts Will Mean Massive Layoffs.]

Murray's position is in line with the rally call President Barack Obama has touted on the campaign trail, but Democrats in Congress have struggled to present a united front in the past week.

Democratic leadership, including House Minority Leader Nancy Pelosi and New York Sen. Chuck Schumer, broke rank with the president last week when they declared they supported Bush-era level tax cuts for people making $1 million or less instead of the $250,000 level the president has supported throughout the campaign. They quickly backed off that position to fall back in line with Obama. [Fiscal Cliff Unavoidable Experts Say.]

Democrats all around, however, are still vowing to let the Bush tax cuts expire for the very wealthy and preserve expensive entitlement programs like Medicaid and Social Security.

Vice President Joe Biden doggedly attacked House Republicans Monday for supporting House Budget Committee Chairman Paul Ryan's budget, which he says supplements millions in tax cuts to the rich at the expense of entitlement programs like Medicaid.

"When one team says 'Let's preserve it,' and the other team said 'Let's get rid of it and do something different,' there's not much room for compromise," Biden said.

Former Minnesota Republican Rep. Bill Frenzel, also a former leader on the House Budget Committee and a guest fellow at the Brookings Institution, says Democrats should be weary of painting themselves in a corner when it comes to taxes.

"For now it looks like a high-risk policy," Frenzel says. "They are acting a little bit like the House Republicans acted over the debt ceiling. And if bad things happen, they may look pretty silly."

And bad things are expected to happen if the Congress can't come to a compromise. At best, economists say it could slow growth significantly and at worse, some say it could force the country back into a recession. [Check out political cartoons about the budget and deficit.]

"The only way to proceed is to come to some kind of agreement where there is a combination of reduced entitlement and higher taxes," Frenzel says. "Neither party is talking about that and Republicans and Democrats are guarding their territory."

Grover Norquist, president of Americans for Tax Reform, says that Democrats are engaging in election-year rhetoric, trying to appear as the compassionate party that protects middle class families when in reality its all a facade.

Norquist says Obama and Democrats in Congress are upset over extending the Bush tax cuts for the middle class, but not long term, just for a year.

"They've said they support them for one year," Norquist says. "If they really wanted to make it permanent, they would have done it in 2009 or 2010, when they had a majority in the House and Senate, and they didn't."

Norquist says voters should expect Obama to let all the tax extensions expire after the year's up.

He says never in electoral history have Americans had a clearer picture of who supports raising taxes and who opposes it.

"The tax issues is front and center," Norquist says. "If you elect a Democratic president, there is a $500 billion tax increase coming." [See a collection of political cartoons on Congress.]