A poison pill tax increase plan by Republicans holds the Supercommittee and Democrats hostage. Acceding to Democrats demand for revenue to be included in any debt reduction plan, they propose a raise of $300 billion, while reducing taxes on the wealthy. They also hold themselves hostage by their own foolishness in signing Grover Norquist's "No Taxes Ever, Never, Ever" pledge. Since they signed, the USA fought two wars for 7 years "off budget." The country simply borrowed the money for all those weapons, people and ammunition. And now, the national debt and deficit are suddenly hairy scary and an immediate national emergency. In other words, now it's time to pay up... but only for those who need Social Security, Medicare or Medicaid!
Democrats have long said that it is not possible to slash and burn enough domestic programs to pay for those wars and the interest on the money borrowed to fund them. Revenue is needed as well. To raise that revenue, they have proposed allowing the top income tax rate to return to the 35% at which it rested just before President Bush cut it to 32% (and started his wars soon thereafter). At first, Supercommittee Republicans simply repeated the standard talking points about "class wars," "job-killing taxes" and the "unfairness" of a progressive income tax.
But someone had an idea. They would make it look as if they proposed more revenue. A Democrat refusal would look like they were the hostage holders. A new tax structure would be written (in seven days?) that would increase revenue by $300 billion. How could the Democrats say no, without appearing to be hard-line hypocrites? Pretty easily, as it turned out. The "poison pill" was easily recognized... to get the $300 billion in revenue, Democrats would have to agree to reduce taxes to 28% on the wealthiest Americans.
The plan did raise taxes, but not on people who had the money to pay them. Paying the new tax rates removed money from the pockets of the poor and middle class, while Social Security, Medicare and Medicaid got reduced by various means as well. That was the 'compromise' plan, a super tax on the poor in the form of removal of essential income and health programs, while the poison pill reduced taxes on the wealthy.
Republicans did provide some light relief. Members of the new TEA-Republican majority, about 70 of them, apparently missed the poison pill point of the exercise and thought it was a real proposal. They signed a letter stating that any tax increase would be "irresponsible and dangerous to the health of the United States." Grover Norquist and his group Americans for Prosperity also seemed to miss the point. They began a campaign targeting 40 House Republicans who might be open to new taxes, threatening at one point that if taxes were actually raised, it would mean the end of Republican control of Congress.
Democrats won't swallow the poison pill plan. That doesn't constitute holding the Supercommittee hostage.