The Slatest

This Exchange Over Taxes Perfectly Sums Up the Fight for the Soul of the Democratic Party  

Bernie Sanders and Hillary Clinton faced off over taxes at the third Democratic debate.  

Photo illustration by Slate. Photos by REUTERS/Brian Snyder and iStock.

The most important exchange at Saturday’s Democratic debate in New Hampshire, hosted by ABC News, wasn’t on ISIS or “regime change” or college education. Instead, it was a brief back-and-forth between Bernie Sanders and Hillary Clinton on taxes.

The dispute started with a discussion of health care reform. Clinton pledged to defend and expand the Affordable Care Act, while Sanders called for “single-payer” health insurance. This became a discussion of their broader plans for the country, with a skeptical Clinton pushing back on Sanders’ call for new programs. “Free college, a single payer system for health, and it’s been estimated we’re looking at 18 to $20 trillion, about a 40 percent in the federal budget,” she said. “And I think we’ve got to be really thoughtful about how we’re going to afford what we proposed.”

Bypassing the moderators, who tried to stop him, Sanders shot back: “It is unfair simply to say how much more the program will cost without making sure that people know that we are doing away with the cost of private insurance,” he said.

They then moved to an exchange on taxes, where the moderators pressed Clinton on her pledge to hold down taxes for the middle-class, defined as families with incomes under $250,000 a year. “I don’t think we should be imposing new big programs that are going to raise middle class families’ taxes,” Clinton said. “We’ve got to get back to where people can save money again, where they can invest in their families, and I don’t think a middle-class tax should be part of anybody’s plan right now.”

Immediately, Sanders hit back:

Now, when Secretary Clinton says, “I’m not going raise taxes on the middle class,” let me tell you what she is saying. She is disagreeing with FDR on Social Security, LBJ on Medicare and with the vast majority of progressive Democrats in the House and the Senate, who today are fighting to end the disgrace of the United States being the only major country on Earth that doesn’t provide paid family and medical leave.

What the legislation is is $1.61 a week. Now, you can say that’s a tax on the middle class. It will provide three months paid family and medical leave for the working families of this country. I think, Secretary Clinton, $1.61 a week is a pretty good investment.

The particular plans and promises in this exchange aren’t important. What matters is that, for the first time in the presidential race, Democrats are touching on the core ideological tension in the party.

The Democratic Party is moving to the left. The Obama administration will end as the most liberal presidency since Lyndon Johnson’s. The Democratic grassroots has embraced figures like Elizabeth Warren, and now, Bernie Sanders, who call for class consciousness and a fundamental change to the balance of American politics. And even as she runs to the right of Sanders, Clinton’s second White House campaign is measurably more liberal than the one she ran in 2008.

What this means, in practice, is a Democratic Party that’s less hesitant—and in the case of Sanders, more forthright—about using national government to solve or ameliorate social problems, from income inequality and low wages to gun violence and health care access. It’s a Democratic Party that has put paid leave and child care at the top of its agenda, on top of strengthening programs like Obamacare and expanding others like Social Security.

But there’s a problem. The Democratic Party is still a coalition, and it’s not a coalition of liberals. Most Democrats, and people who vote for Democratic candidates, are moderates or even right-leaning. They don’t share the priorities of their liberal partners. And Democratic politicians have to represent them too, as we see in states like West Virginia and even Pennsylvania.

What do you do, as a national party leader, when one faction supports broad programs and broad taxes, and the other likes these programs, but prefers tax cuts? Like Barack Obama—and now Hillary Clinton—you split the difference. You raise taxes on the rich, and you use that money to fund modest programs for middle- and working-class Americans, from debt-free college education to tax credits for child care. Anything beyond that, and something has to give. Either you push confiscatory taxes on the rich, or you raise taxes on everyone and compensate with more progressive policy.

Bernie Sanders, like a growing cohort of liberals, wants a more social democratic America, and is willing to raise taxes to achieve it. And by injecting this stance into the Democratic primary, he’s forcing the party to contend with it. If it wants more and more expansive programs, then it will have to raise taxes on everyone, and make a case for doing so.

Hillary Clinton doesn’t want to make that case (neither does Martin O’Malley, for that matter). And so her sights are set on the center of the Democratic consensus—high taxes on the rich, new small programs for everyone else.

But, again, the Democratic Party is moving left. Democratic voters are becoming more liberal. And following that trend, Democratic policymakers, including lawmakers, are beginning to call for more (and more ambitious) progressive policy. Eventually, all of this will collide with the pledge to cut middle-class taxes. Arguably—looking at the scope of Clinton’s proposals—it already has.

If tonight’s debate did anything substantive, it marked a divide for Democrats, and emphasized what it would take for the party to move fully to the left—a commitment to higher taxes for everyone. Right now, only Sanders will take that leap. But—looking down the line of demographic and ideological change—he might presage a new consensus.

Read more of Slate’s coverage of the Democratic primary.