President Barack Obama's top political aide Wednesday defended the tax plan the president hammered out with Republican leaders, even as Democrats threaten to rebel over it.
David Axelrod insisted the most important thing was that Obama had been able to secure a two-year extension in current income tax rates for "the middle class."
Democrats are angry that the extension also applies to high earners, as Republicans had demanded, and that Obama agreed to a Republican proposal on the estate tax.
"Our guys got taken to the cleaners," top Democratic Rep. Chris Van Hollen, D-Maryland, said Tuesday night.
Rep. Gary Ackerman, a New York Democrat, joked bitterly about the notion that Democrats hadn't gotten anything out of the negotiations.
"I disagree that we didn't get anything -- we got screwed," he said.
Rep. Anthony Weiner, also a New York Democrat, accepted that politics involves compromise, but blasted Obama's negotiating skills.
"I honor the president for wanting to try to solve these problems, and I'm not saying that you never compromise," he said. "This is Washington. That's how laws get passed. But he and his team just don't seem to be any good at it, and that's a real problem for a lot of Democrats."
But Axelrod called the proposal "a good deal," saying the president and his team "need to focus on what's good for the country, what's good for the American people."
If no deal was passed, he said, "taxes would go up, people would lose their unemployment insurance and the economy would suffer."
He also downplayed predictions that the tax deal -- which does not include any revenue-raising measures -- will increase the deficit by a huge amount.
"The most important thing we can do to get our deficit down is to have robust economic growth," he said on CNN's "American Morning." "Every economist who has looked at this said this would be a real shot for economic growth."
House Democrats vented their frustrations over Obama's tax proposal at a closed-door meeting Tuesday night, with rank-and-file members slamming the White House for leaving House Democrats out of final negotiations and agreeing too quickly to a GOP proposal on the estate tax.
According to several Democratic members and aides, much of the discussion centered on the addition of the estate tax exemption to the package extending all the Bush-era tax cuts for two years.
Democrats are fuming that the administration agreed to exempt inheritances up to $5 million and to set the tax rate at 35%. The estate tax is scheduled to be reinstated at a higher rate of 55% next year, with the exemption up to $1 million. A bill that passed in the House a year ago set the threshold for the exemption at $3.5 million and the tax rate at 45%.
"My sense is people are not happy with this," said Pennsylvania Democrat Allyson Schwartz, who also told reporters that Democrats plan to "push back a little" at the White House to try to change the estate tax back to the version that passed the House. Schwartz said if the administration agreed to do that, she could support the package, but she could not predict how many other Democrats would do the same.
According to a senior House Democratic aide, Rep. Van Hollen, who represented House Democrats in discussions with the administration and Republicans, said the decision to accept the GOP estate-tax proposal was "an unnecessary giveaway to Kyl."
GOP Sen. Jon Kyl of Arizona, who was negotiating for Senate Republicans, sponsored an estate-tax bill that is essentially the same as the deal outlined by Obama.
About 20 House Democrats lined up at microphones after the evening meeting to complain about the president's proposal. According to the senior Democratic aide, in addition to concerns about the substance of the proposal, equally upsetting to attendees was how, "House Democrats were left out of the process at the end."
The aide added, "They view it as a trend," noting that it started with the president's stimulus package. "The House always seems to get rolled," the aide said.
House Speaker Nancy Pelosi "didn't really weigh in either way" during the meeting about how members should vote on the president's plan, according to the aide, "but she certainly wasn't cheerleading for it."
But Pelosi made it clear Democrats were unhappy, telling reporters outside the meeting, "I think it's fair to say that there is a certain amount of unease with the proposal that was put forth by the president." She also noted that the estate tax benefits a much smaller number of families than the middle-class tax cut.
The senior Democratic aide conceded that despite the threats to vote against the plan, it's also a reality that the proposal could still pass the House. "This gets done, but does not get done with a majority of Democratic votes," the aide said.
Vice President Joe Biden is scheduled to talk to House Democrats Wednesday afternoon. Asked whether Biden could convince Democrats to support the plan, House Majority Leader Steny Hoyer quipped, "You'll have to ask him."
Hoyer didn't directly answer a query on whether he believed House Democrats could make significant changes to the administration's plan.
"I think it's under discussion," he said, but added, "the majority of the House is still Democratic."
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