The Democrats' struggle to end the Bush-era tax cuts is grounded in the Democrats' attempt to restore socioeconomic equality and rectify the allegedly looming national debt crisis. The Bush-era tax cuts enacted in 2001 and 2003 applied to much of the nation, but the benefits went disproportionately to the wealthy. In the early 2000s at the beginning of President George W. Bush's administration, the United States ran a yearly budget surplus due to the spending cuts and economic boom of the late 1990s. Along with the lowering of the tax rate for all tax brackets, the tax rate on capital gains and various investment vehicles were reduced. During the past 10 years, the United States has endured two costly wars, the sub-prime housing crisis, various bailouts, and a severe economic recession. Consequently, the national debt has risen from over $5.6 trillion to nearly $14 trillion. With projected increases in Medicare and Social Security spending due to the impending retirement of the Baby Boom generation, the nation is facing a debt crisis.
With the impending crisis, Democrats seek to maintain Medicare, Social Security, and other entitlement spending programs while resolving the United States' fiscal situation. At their core, Democrats seek to minimize the socioeconomic inequality resulting from a market economy. In other words, Democrats seek to provide aid to those who have been left economically vulnerable due to old age, disability, or poverty. Due to the impending debt crisis, severe changes will have to be made to government spending and taxing. Many Republicans seek to end or mitigate the pay-outs from the various entitlement programs that Democrats support in order to restore fiscal discipline and alleviate the national debt. Instead, Democrats believe by allowing the Bush-era tax cuts to expire, billions of dollars in tax revenue can be generated to avoid steep cuts to entitlement programs over the next decades. Although most Democrats agree that ending the tax cuts to income brackets over $250,000 (high earners), there is substantial disagreement over whether the lower tax brackets, which affect the middle and lower classes, should be allowed to expire especially in light of the nation's current economic struggles. Despite these disagreements, an end to some or all of the Bush-era tax cuts could go a long way in easing the nation's fiscal situation, and therefore, debt crisis. Many Republicans argue that higher taxes will place a substantial burden on the economy. With respect to high earners, Republicans argue that higher taxes discourage investment and productivity. Democrats assert that high earners are less likely to spend that money. If any tax cuts should remain, those affecting the lower and middle classes should continue because those individuals are more likely to spend their money on goods and services. Regardless, any burden on economic activity by the expiration of the Bush-era tax cuts is viewed by Democrats to be minimal and off-set by the continuation of entitlement pay-outs to the vulnerable who must spend these pay-outs to survive.
Not only does the maintenance of the entitlement spending programs serve the Democratic goal of socioeconomic equality, but the expiration of the Bush-era tax cuts does as well. At the heart of these entitlement programs, the income of workers is taxed and then spent on those in need. In other words, the federal government redistributes some of the taxed income of the wealthy to the poor. Similarly, the progressive tax system operates in the same way. Income is taxed at different rates. For example, the first several thousand dollars of income will be taxed at a lower rate than the next several thousand dollars and so on. Thus, high earners pay a larger percentage of their income in taxes which effectively subsidizes the lower rates paid by the lower and middle classes. As such, the tax code itself has a redistributive effect as well. Many Democrats assert that such a system is not only justified by the fact that high earners earn much more, but also because the wealthy (the top 2%) in America over the past 30 years have become wealthier at a much faster pace. In fact, over the past 10-15 years, the economic gains have gone to the wealthy while the lower and middle classes have seen their wages stagnate or decrease. Consequently, wealthy have become wealthier while also greatly benefiting from the Bush-era tax cuts. Democrats believe it is time for the wealthy to pay their dues from the gains they have made, and thus, help alleviate the fiscal situation and debt crisis. This also prevents the nation from becoming increasingly stratified between the haves and have-nots.
In conclusion, the Democrats seek to maintain some semblance of equality. In order to achieve that goal, the current redistributive system as seen through the tax code and entitlement spending must be maintained if not accelerated to account for the substantial increases in wealth of the wealthy over the past couple decades.