STORY OF THE WEEK: A BIG WIN FOR THE PRESIDENT, MIDDLE CLASS

Late last week, the U.S. Congress put the finishing touches on compromise legislation on tax cuts negotiated earlier in the month between President Obama and Republican Senate minority leader Mitch McConnell. The deal, which enjoys considerable support among the American public, is expected to provide a much-needed boost to the U.S. economy. It also represents a decisive win for President Obama.

The legislative package includes at least one item that pleases--and at least one that angers--just about everyone. It is, after all, a compromise. The deal includes a number of core Democratic priorities (many of which the Republicans were blocking or had threatened to block), including a 13-month extension of unemployment insurance, an extension of tax cuts for middle class families, a 2% payroll tax holiday for 2011, equipment expensing for small businesses, a child tax credit, renewable energy grants, and an earned income tax credit, among other items. The Republicans secured a temporary, 2-year extension of the Bush tax cuts for the richest Americans and a $5 million threshold on the estate tax.

In strict dollar terms, the Democrats got twice as much out of the compromise than Republicans, which is no small feat considering the new political dynamics occasioned by the midterm elections. (Charles Krauthammer, a prominent conservative commentator, went so far as to characterize the deal as Obama's "swindle of the year"--as charitable as Krauthammer's compliments of Obama go). The total cost of the compromise package is just north of $900 billion dollars. That amounts to an investment larger than any other legislation passed under Obama, including the economic recovery bill, TARP I and II, and the health insurance reform bill. And it passed with substantial Republican support.

More importantly, the American public is firmly behind the compromise package. Pre-deal polling was clear in showing that the public adamantly opposed letting the Bush tax cuts expire across the board. A CBS News poll from late November, for example, showed just 14% of voters preferring to let all the tax cuts expire, versus 53% who supported President Obama's middle class tax cuts plan and 26% who supported the Republican plan to extend tax cuts for everyone, the rich included. Put another way, over three-quarters of the public supported some form of a tax cuts extension.  

Public support for an extension of the tax cuts has held even as details of the compromise package have been unveiled. A recent Pew Research poll finds 60% approving of the "agreement to extend tax and unemployment benefits" reached by the president and Republican leaders (22% disapprove, and 18% are unsure). A recent Gallup poll finds about half (49%) think Congress should pass the "agreement on taxes reached by President Obama and Republican leaders in Congress" (32% say not pass, and 18% are unsure). The number favoring passage climbs to 60% among those who say they have been paying attention to the negotiations (35% not pass, 5% unsure).

A new Washington Post / ABC News poll provides the most detail on the compromise package, asking about the four central components individually before asking about the package as a whole. Individually, the most popular item is the extension of unemployment benefits (79% favor, 26% oppose), followed by the extension of the Bush tax cuts to everyone (54%, 42%), increasing the estate tax exemption (52%, 42%), and cutting Social Security payroll taxes by 2% in 2011 (39%, 57%). Overall, 69% support the agreement "to do all four of these things together as a package," compared to 29% who oppose and 2% who are unsure. Support holds even after people are reminded that the agreement increases the federal deficit by $900 billion and lavishes tax cuts on the richest Americans (62% favor, 34% oppose). Notably, only 11% support all four items; just 38% support two; yet as a package, clear majorities of Democrats, Republicans, and independents favor the agreement. 

Even so, there are cautions for the president and Democrats with this compromise legislation. The deal has not been an unmitigated winner with the Democratic base. According to Gallup's most recent tracking survey, while the president's overall job approval rating has inched up a point since early November, from 45% to 46%, among Democrats it has edged downward by five points, from 83% to 78%. A recent Marist poll also shows a slight depreciation in the president's job approval numbers among Democrats since early November.

Few Americans believe, nor do any pundits argue, that this compromise tax bill is perfect. Yet the public places significant value in political compromise if it means getting things done. On an issue such as the economy and unemployment, the public's top issue and one in which aggressive action is still imperative, this tax deal represents an unfortunately rare moment where the parties reached a compromise that helps the American people when they need it most.

OTHER NEWS

ALR "Beat the Pollsters" Contest: We are pleased to announce our winner from the election contest: Christopher Cellier, a law student from the Buckeye state. Chris correctly predicted nearly all of the 68 House, Senate, and Gubernatorial contests! Congratulations, Chris.

Obama: The Washington Post / ABC News poll finds that Americans trust President Obama more than Congressional Republicans when it comes to dealing with the country's main problems in the coming years (43% to 38%).  

DADT: The same poll finds over three-quarters of Americans (77%) favor allowing gays and lesbians to serve openly in the military.This includes majorities of Democrats, Republicans, independents, liberals, conservatives, and even white evangelical Protestants.

Women voters: An Emily's List / Garin, Hart, Yang poll finds 62% of women voters who either sat out 2010 or voted Republican / 3^rd party say they are inclined to re-elect President Obama in 2012. In a matchup between Obama and Sarah Palin, 80% of the women surveyed picked Obama compared to 10% for Palin.

Gov't shutdown: By a 3:2 margin, respondents in a new Bloomberg poll say they would not support the kind of political impasse that brought the federal government to a halt in 1995. (h/t PoliticalWire)

Unelectable: PPP's 2012 polling in seven key states has them concluding that Sarah Palin is "virtually unelectable," owing in large part to her "complete lack of appeal to Democrats and independents" and tepid support among Republicans.

Gov't waste: Gallup finds that the public thinks the federal government wastes fifty cents on every dollar collected. This is up from a low of thirty-eight cents in 1986. The public thinks state and local governments waste less of their money (42% and 37%, respectively).

WikiLeaks: Fully 68% in the new Washington Post / ABC News poll think WikiLeaks' exposure of classified State Department cables harms the public interest. 59% say the government should arrest WikiLeaks' founder Julian Assange and charge him with a crime.

Congress: A new Gallup poll finds approval of Congress at an all-time low of 13% approve, 83% disapprove.

Nurses: Another Gallup poll finds that nurses and physicians garner the most favorable ratings (88% and 84% positive, respectively), while nursing homes and health insurance companies do not (33% and 42% favorable, respectively).  

PUBLIC POLLING