House Speaker John Boehner is negotiating like a man who believes he is already out-flanked and defeated by President Obama. As a Republican, I am embarrassed for Boehner and my party.
As a small businessman who has survived through his street smarts and negotiating skills, often up against much wealthier deep-pocketed competitors, I have some pointers for Mr. Boehner. My goal is to prevent a GOP “brand suicide” in these fiscal cliff negotiations.
First, winning this negotiation is about winning the media battle. You need a winning argument. Doesn’t Boehner know that this battle has already been won in England? Why isn’t the House Speaker (and his lieutenants) in the media, day and night, pointing out that the UK tried Obama's exact idea of a “Millionaires Tax” only a year ago and it proved a disaster. Two thirds of the millionaires in UK disappeared in one year -- from 16,000 to 6,000. Either they moved to other countries with their money, or they slowed down and stopped working so hard.
Result? Tax revenues PLUNGED, instead of increased. Two years ago British millionaires contributed 9% of all taxes. After the special tax on “the rich” passed, this same group produced 4.4% of all taxes. In other words the UK politicians damaged their economy, and proved that revenues go down with the same “Millionaires Tax” that Obama now demands.
There is no debate. The case is settled. The “Millionaires Tax” is a proven failure. Get that message out before we kill our economy just like they did in England.
Secondly, winning this negotiation is about winning the public relations battle. Obama travels the nation stopping in the homes of middle class families and asking them how paying $2,000 in extra taxes would effect them. Brilliant.
The face of the top 2% of earners in the United States isn’t a billionaire. It’s small business owners, professionals, and family farmers. The GOP needs to win over the American public by showing them the faces of small business that will be affected by higher taxes.
The GOP should purchase national TV infomercial time and introduce America to farmers who will lose their farms because of this new tax; doctors who will lay off nurses; homeowners who will no longer pay the mortgage on their “under water” home if they get hit with higher taxes or loss of deductions; small business owners, who because of a tax increase, will lay off half their employees. Show the voters real faces and real stories.
I know people with each of these stories -- including me! Maybe Warren Buffett and Bill Gates can afford a tax increase, but most small business owners are struggling to pay bills and keep their businesses going. We are hurting too. We cannot afford a tax increase. “The rich” that Obama is attacking isn't billionaires. They are you and me -- small business owners. Why is it okay to present us with a tax increase for Christmas?
Third, Obama claims this tax increase is “just going back to Clinton-era rates.” The GOP needs to take the offensive to debunk this misleading statement.
The Clinton economy was fueled by a GOP Senate and House that forced Clinton to cut spending, cut rules and regulations, lower capital gains taxes (to encourage investment- thereby creating jobs), and end welfare as we know it. And the GOP Congress killed a government-run health care proposal, too. The Clinton economy boomed because government, spending, and entitlements were much smaller than they are today.
Each time Obama demands Clinton era tax rates, then Boehner should say, “Let’s go back to the size of government, spending, and entitlements under Clinton. Let’s eliminate all the rules, regulations and mandates since Clinton. Then we can compromise and raise rates to Clinton levels.”
Fourth, Obama claims his victory on November 6 was a mandate for tax increases. So let’s give Obama’s voters tax increases. Why is Obama defending the Bush tax cuts for 98% of Americans? Obama is admitting that Bush was right--lower taxes are good for the economy. He says a tax increase now would devastate the economy. Really? If lower taxes are good for Obama’s voters…who voted for higher taxes…why wouldn’t they be good for everyone? This argument makes Obama look foolish and hypocritical. Boehner needs to take the offensive.
Lastly, point out that Obama created the fiscal cliff with $5 trillion in new debt. He is a spending addict. There is no “tax problem.” Taxes aren’t low. Obama has more tax revenues than any President in history. He’s just spent it all -- and then some.
If high taxes worked, why are the PIIGS (Portugal, Ireland, Italy, Greece, and Spain) all bankrupt and insolvent? And closer to home, why isn't Detroit an economic model for the nation? Why have over one million citizens escaped from California in the past decade? There is no debate -- this is already settled. Big government, big taxes and big spending destroy economies.
Boehner should point out there is only one antidote. Canada proved it in the 1990’s -- their political parties agreed to compromise -- with massive spending cuts AND tax cuts. That combination worked. Their economy healed. Their debt crisis ended.
With all due respect Speaker Boehner, please take the offensive. This is how you win a negotiation.