Dems fear "the label" - they don't fear taxing ans spending.
Luckily the press is in their pocket so they don't have to worry much about the truth getting out --- except for FOX, talk radio, FreeRepublic, and the Internet.
I think their original plan was to raise taxes after the economy made a major recovery, which they thought would be well before the 2010 midterms.(as did some Republicans) If the economy significantly recovered by early 2010 Obama could have got away with tax increases and still got re-elected as well as held the house in 2010. It would have been his economic ‘kill Bin laden’ scenario for Obama.
But the economy was worse than they thought and what they did was the wrong things and so it crapped out again last year, not helped by Greece. That helped poison support for Obama-care too. So what was their best political option? Stage a defeat (surrender) on taxes, tell their base they had no choice(that progressive base is very unhappy over this too), and use the issue to cloud the ‘we are broke’ Republican moral argument on debt and deficit reduction. That was their best play of the hand they had. It is now being used effectively to generate opposition to the Ryan plan.