Megan McArdle put her finger on precisely why Barack Obama floated the oh-heck-no proposal to tax people’s 529 college funds: “About the only people I saw defending this particular idea were blue-state singles who haven’t yet confronted the monstrous expense of shepherding their progeny into the new mandarin class to which they belong.” …And that’s who Barack Obama was trying to back-channel pander to, of course. In 2012 single voters broke strongly for Obama – single women more so then men – and since a tax hike on college fund earnings wouldn’t affect them too much (especially the ones without kids), Obama probably figures that it’s a ‘safe’ tax hike to have*.
This is, of course, a mistake. Despite our worries about falling birthrates, the truth of the matter is that most people still want to have kids. And virtually all parents want their kids to do as well in school as they can. And so most people are going to be worried about looming educational costs. Which, of course, is why (as Megan notes) this proposal isn’t going anywhere. Then again, it doesn’t have to. It merely has to be, because if the President is offering policy proposals that would have a significant impact, then clearly the President matters.
And that’s what this is about. President Barack Obama is used to mattering, and he is going to his level best to try to keep mattering for as long as his own party will let him get away with it. Personally, I hope that they never get him under control; it’d be really useful for us in the 2016 election if the eventual Democratic candidate has to shove Obama away from the microphone every time he started talking.
*As Megan later notes, a major reason why Obama’s trying to get this tax revenue is because six or so years of grabbing all the low-hanging fruit has left the tree mighty lean, to mix a metaphor or two.