I love this clip from The Simpsons. It perfectly describes why Republicans and their attendant Villagers are pushing so hard and loudly to 'do a deal' before December 31st. Here's the money quote from Mr. Burns:

Think of the economy as a car, and the rich man as the driver.

If you don’t give the driver all the money, he’ll drive you over a cliff.

That's exactly what Republicans are threatening. I know there have been a lot of posts about this so-called cliff, but I think it's worth listing what happens on January 1st if Democrats do absolutely nothing:

• The top tax rate for individuals goes up by about 4 percentage points.
• Capital gains rates increase to 20 percent.
• Dividends are taxed as ordinary income, rather than at the Bush-era 15 percent capital gain rate.
• Estate tax rates return to 2001 levels, and the taxable cap returns to $2 million instead of $10 million.
• Payroll tax holiday expires

Some of these consequences aren't great for the middle class, which is why House Democrats are pushing so hard to force a vote on the Senate bill extending those tax cuts while allowing the upper-income tax cuts to expire.

Still, the White House is signaling that they're comfortable with waiting until January, and rightly so. Anything they can do in December, they can do in January, retroactive to January 1st. But by waiting until January, Democrats will be dealing from a position of pure strength then, because any vote in January will be a vote to cut taxes, not increase them.

The real sticking point, by the way, is the estate tax, which no one is talking about. It's not just a problem with Republicans, but also Blue Dog Democrats. Senator Mary Landrieu (D-LA) is one of those who refuses to vote on any package that doesn't preserve estate tax levels at a $5 million cap and 35 percent tax rate. Evidently Senator Landrieu is fine with establishing a permanent plutocracy in this country, because nothing is more helpful for that than the current ridiculously low estate tax rates and high estate exemption of $10 million.

We've already seen rumbles that Republicans intend to hold the debt ceiling hostage yet again. This practice has to be stopped and it has to be stopped now. As long as they think they have some leverage, Republicans will continue to try and cut Medicare, Medicaid and Obamacare while holding the debt ceiling hostage to do it. Democrats have to be pushed to stand firm, and if the tea party is pushing Republicans to jump into the abyss, so be it.

As for sequestration, it will certainly be better to look at the budget in light of more guaranteed revenue right now than it will to start playing trade-off games with it. Sequestration was a Republican idea, and they should own it outright.

When the new Congress convenes in January, the tea party will have less leverage and Democrats will have all of the messaging on their side. There is no upside for Republicans. They need to learn this early on.

It is not 2009. There is no reason to continue to put up with their nonsensical Lucy and Charlie Brown football-snatching game. They need to learn that the voters, not the billionaires, will decide this debate.

If you want to push Congress to extend the middle class tax rates, you can join the action here.

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Contrary to popular belief, there were some excellent moments for President Obama in the debate. Unlike his opponent, the president actually had some factual statements to make about our current tax structure, and used Donald Trump to illustrate the fallacy of Willard's concern trolling over small business:

“Under Governor Romney's definition, there are a whole bunch of millionaires and billionaires who are small businesses. Donald Trump is a small business. Now, I know Donald Trump doesn't like to think of himself as small anything, but -- but that's how you define small businesses if you're getting business income.”

Oh, the possibilities. But of course, the president is absolutely right. Just like Koch Industries is a small business. Lots of Mitt Romney's shell companies, even those in the Cayman Islands, are "small businesses."

I actually thought this was a good moment for the president, even though some others disagreed with me at the time, groaning that mentioning Trump would mean he'd pop up on the news cycle for another 24 hours. Hey, he'd show up whether he was mentioned or not. But I can't think of a more iconic representation of the self-absorbed nasty billionaire that resonates with the public than Donald Trump. So for me it was a winning moment.

Also, the crack about Trump not liking to think of himself as small anything was well...inviting. Imagine the snark we could raise over that remark.

On the campaign trail today, President Obama laid down the clearest challenge yet to the Romney/Ryan approach to tax policy, and left citizens with a challenge question for the other guys:

PRESIDENT OBAMA: Their ideas are pretty simple. They're not hard to explain. They think that if we get rid of more regulations on big corporations and big banks, some of which we put in place to prevent another taxpayer-funded bailout, and if we do more tax cuts for the very wealthiest Americans then somehow prosperity’s going to rain down on all of you. That is their theory.

In fact, the centerpiece of my opponent's entire economic plan is a new five trillion dollar tax cut, a lot of it going to the wealthiest Americans. His new running mate, Congressman Ryan, he put forward a plan that would let Governor Romney pay less than 1 percent in taxes each year. And here's the kicker -- he expects you to pick up the tab.

Governor’s Romney tax plan - this is not my analysis now - this is the analysis of independent folks who analyze tax plans for a living. That’s what they do. Their analysis showed that Governor Romney's tax plan would actually raise taxes on middle class families with children by an average of $2,000. Not to reduce the deficit, not to grow jobs, not to invest in education, but to give another tax cut to folks like him.

Now, ask Governor Romney and his running mate, when they’re here in New Hampshire on Monday - they’re going to be coming here on Monday - ask them if that’s fair. Ask them how it will grow the economy. Ask them how it will strengthen the middle class. They have been trying to sell this trickle-down snake oil before. It did not work then. It will not work now. It’s not a plan to create jobs. It will not reduce the deficit. It will not move the economy forward. It’s the wrong direction for America.

Also? "Trickle-down snake oil" is probably the most visceral metaphor I've heard yet. It made my skin crawl.

I'll be curious to see if anyone takes the challenge.

David Cay Johnston is perhaps the best-informed reporter in the country on tax policy, and he's been a one-man band for a long time, beating the drum for fairer taxes. If you're mad about corporations shirking taxes, check out the actions USUncut has scheduled today all over the country:

For three decades we have conducted a massive economic experiment, testing a theory known as supply-side economics. The theory goes like this: Lower tax rates will encourage more investment, which in turn will mean more jobs and greater prosperity—so much so that tax revenues will go up, despite lower rates. The late Milton Friedman, the libertarian economist who wanted to shut down public parks because he considered them socialism, promoted this strategy. Ronald Reagan embraced Friedman’s ideas and made them into policy when he was elected president in 1980.

For the past decade, we have doubled down on this theory of supply-side economics with the tax cuts sponsored by President George W. Bush in 2001 and 2003, which President Obama has agreed to continue for two years.

You would think that whether this grand experiment worked would be settled after three decades. You would think the practitioners of the dismal science of economics would look at their demand curves and the data on incomes and taxes and pronounce a verdict, the way Galileo and Copernicus did when they showed that geocentrism was a fantasy because Earth revolves around the sun (known as heliocentrism). But economics is not like that. It is not like physics with its laws and arithmetic with its absolute values.

Tax policy is something the framers left to politics. And in politics, the facts often matter less than who has the biggest bullhorn.

The Mad Men who once ran campaigns featuring doctors extolling the health benefits of smoking are now busy marketing the dogma that tax cuts mean broad prosperity, no matter what the facts show.

As millions of Americans prepare to file their annual taxes, they do so in an environment of media-perpetuated tax myths. Here are a few points about taxes and the economy that you may not know, to consider as you prepare to file your taxes. (All figures are inflation-adjusted.)

I especially enjoyed the information on just how much the poor pay in taxes -- especially compared to the rich.

When the president says this compromise satisfies no one, he really isn't kidding. But my question is whether it makes for good policy in the long run. My gut and my head say it doesn't, though it does have some extremely beneficial provisions.

The Good

Child tax credit - In general, refundable tax credits are far more valuable than deductions or even rate reductions. The Child Tax Credit gives eligible taxpayers (low income families) a refundable tax credit of $1,000 per child. That's a significant break for families who most need it. It's estimated to benefit 10.5 million families with 18 million children.

College Tuition Tax Credits - The Recovery Act included refundable tax credits of up to $2,500 to assist with college tuition, books and costs. This deal extends those, and makes college affordable for families and students who couldn't otherwise afford it.

Unemployment Insurance Extension - Although it doesn't help the 99ers at all under the current framework, it does give some breathing room to the unemployed and puts the burden on business to let go of the trillions they're sitting on for job creation. Since a key GOP talking point is "tax cuts create jobs", 13 months should be more than enough time for that to play out, even though it hasn't for the past 10 years.

Business Investment Tax Breaks - Allowing businesses to expense 100% of their capital investments in one year is a huge jump start to job creation. This is a win-win.

The Bad

2% Payroll Tax Holiday - On its face, it looks great. But if you scratch under the surface, it's really not. The Republicans have long wanted to reduce the payroll tax in order to strip Social Security of its security. Shifting $120 billion from paychecks to a government budget item leaves that piece ripe for cutting when the deficit hawks come to town. At the same time, no one will want to let that provision expire since it's of such immediate benefit.

More importantly, it's bad policy. It's the equivalent of telling employees they shouldn't contribute to 401k plans or save for retirement in hard times, and is basically a way of eroding Social Security's rock-solid financial standing. We're at a point where the taxable wage base should be expanding. If they're unwilling to do that to cover the shortfall from this payroll tax holiday, then it's going to put the whole program on shaky ground.

The Ugly

Extending lower tax rates for high income taxpayers This sort of goes without saying. It's the big bonus for them stooping down and agreeing to extend unemployment. It's bad policy. It reinforces the idea that "expiration" is a myth" and gives political ammunition where none should be allowed. Extending them for two years on the premise that Democrats can run on their expiry is foolish, given the fact that Democrats aren't letting them expire now.

Temporal rate cuts create a situation for business and industry where sitting on large amounts of cash, maintaining austere hiring practices and continuing to make the specious claim that 'uncertainty' leaves businesses with no option will continue to erode all efforts at legislation and governance, which is, of course, exactly what conservatives want. Extensions of temporary rates are far better political ammunition for conservatives. Permanence would kill it as a political talking point.

Estate Tax Concessions The 35% estate tax rate with a threshold of $5 million is really generous, but that's not really the worst of it. That could be acceptable, except that it is once again a temporary and fleeting thing. That means it will come up again in the middle of the 2012 election at a time where the money boys will be looking for the friendliest party to their cause.

Alternatives

There aren't many that don't involve some real sacrifice. Look at the list of the good. There are some very real, significant, tangible benefits to lower and middle income families there. It would be a blow to the economy and to those families to see their tax bill rise and lose those refundable credits. Unemployed people need the unemployment benefits to survive.

Still, overall this is bad policy, in my opinion. If the clock were to run out on the current tax provisions, 2011 could be a year for real tax reform which is really where we should be going. It's badly needed.