Every week on Monday morning , the Council and invited guests weigh in at the Watcher’s Forum, short takes on a major issue of the day. This week’s question: The Fiscal Cliff: Let it happen or Grand Bargain?
For those of you whom may not be aware, ‘the Fiscal cliff’ refers to automatic and draconian spending cuts and the end of the Bush-era tax cuts and a general hike in taxes as many Americans now exempt form the Alternative Minimum Tax become subject paying it. This was agreed to the last time by both parties as part of a deal to raise President Obama’s credit card limit ( AKA the debt ceiling) last year. It goes into effect January 1st, 2013 if there’s no agreement between President Obama and the House Republicans on taxes, the debt limit and spending. The president wants to raise taxes on ‘the rich’, another binge of stimulus spending, an increase in the nation’s debt ceiling and sole authority to raise the debt ceiling as he sees fit. The Republicans say they’re open to some tax increases but want significant cuts in spending as part of any deal and are not willing to see another stimulus or give the president the authority he wants to raise the debt ceiling unilaterally.
The Razor: Republicans have put themselves in a position where “heads you win tails I lose.” Given this option we have to look at what concerns the GOP House, the ones who must actually make this bargain.
These members, many elected with Tea Party support in 2010, are ideological and concerned about their reelections. Any compromise the Democrats will offer at this point will be ideologically repugnant. The Democrats and their propaganda wing in the mainstream media have fabricated this November’s election into a progressive landslide even when in reality it was anything but. They will not compromise enough to help these members of the GOP at all, and are on a “mission from g-d” or whatever the equivalent is for fired up atheistic liberals.
So the choice is whether to accept a package of tax increases with minimal if any entitlements cuts IF the Democrats offer such a thing, or allow the country to go off the cliff. That’s a big IF at this point, whether the Democrats will offer anything; I half expect them to keep demagoging the issue in the Press to beat up the Republicans through December while failing to negotiate in good faith. The other choice is to stick to their beliefs, fully aware that the Democrats are likely not serious about negotiations. These members will be pilloried by the Press in January, but they are going to be attacked by the MSM no matter what. At least when the primaries come around in a year they will won’t face Tea Party challengers who claim they sold out to the Dems on the tax issue.
Given such a Hobbesian choice, if I were a conservative member of Congress I would publicize the fact the Democrats have not negotiated seriously because they believe the election was a landslide. I would point out that it wasn’t, and as a consequence cannot offer any compromise on my part because it takes two to reach a deal. Every time I was in front of a microphone I would repeat this mantra. I full expect John Boehner to wobble on this issue and I would resist his calls for my vote. After January I would actively work to unseat him.
The Democrats believe the GOP will take the hit if we go off the cliff, but managed properly, I believe it is still possible to portray the Democrats as overreaching. Besides, by the time these members are up for re-election the country will be more receptive to fiscal conservatism than it is today. In the meantime, unfortunately, the half of the voting public that re-elected Obama needs to be taught that elections have consequences and that handing Democrats money is like giving heroin to a junkie.
The Independent Sentinel: President Obama wants to go over the fiscal cliff. It’s a win-win for him. He gets automatic cuts (he wants the military cuts), higher taxes. and he can blame the Republicans, eliminating them once-and-for-all.
In an interview with The Des Moines Register before the election, which he immediately after asked the paper not to print, he spoke about sequestration and the end of the Bush tax cuts ( Clinton tax hikes) as if they were a done deal.
He always makes the political decision over what is right for Americans. His ideology trumps all.
The deal he offered to Republicans yesterday not only didn’t cut anything, it increased spending and it even has a new stimulus. It caused Mitch McConnell to burst out laughing when he saw it. It was more an insult than a joke however. The Republicans can’t even use it as a starting point.
We did vote for revenge as Obama asked.
We should plan to go over the cliff unless Obama extends the artificial deadline until March.
I think he has made it perfectly clear – no compromises!
JoshuaPundit: In politics, perception is always more important than reality. So let’s start with a little bit of reality. The $1.2 trillion of deficit reduction we’re taking about as the Fiscal Cliff works out to $153 billion over ten years. The federal government borrows that every month.
That said, it’s important to remember that there’s no incentive for President Obama to make any compromises. He wants to raise taxes anyway, many of the mandated cuts will come out of our military budget and best of all, he feels he can blame Republicans for it. This makes absolutely no common sense but the way the president sees it, it makes political sense and he sees it as a win-win situation: either they’ll knuckle under and give him what he wants, or they won’t, and he’ll make political capital out of while getting some things he wants anyway.
I hold no particular allegiance for the Republican Party except as (in some respects) an alternative to what I see as ruinous policies. So my main concern now is the coming midterms and 2016, which means the GOP needs to take steps to make sure their fingerprints aren’t on the coming debacle, especially since the non FOX media will side with the president in pushing his narrative.
If I were John Boehner, I’d go on national TV (or have someone who’s a much better speaker do it) and tell the American people in plain terms exactly what’s going on, and why the GOP can no longer support this irresponsible and childish behavior. And I would directly point the finger at the president, in no uncertain terms, including his failure to present any kind of meaningful compromise.
Finally, I would draw a line in the sand and offer Simpson-Bowles, (the plan of the president’s own bi-partisan commission that he later rejected) as the Republican’s final offer. And walk away.
As an even more extreme alternative, I might even tell the American people that if the president failed to come up with a reasonable offer to get our financial house in order, every Republican legislator was going to vote ‘present’ on President Obama’s proposals, in protest. I would tell the American people that Republicans have no intention of allowing this president to blame his failures on others again.
Make him own the Obama economy.
The Noisy Room: In response to this week’s question: ‘The Fiscal Cliff: Let it happen or grand bargain?’ I wholeheartedly say to the Republicans, jump off the cliff! When this whole monstrous mess started, I predicted it would come to this. I don’t know how anyone can be surprised at the outcome. The two choices are now bend over and take massive tax hikes with no meaningful spending cuts, or go off the cliff. I say take the plunge. It’s the only sane choice at this point.
If the Republicans agree to raise taxes, they will lose what little support they have with conservatives and will go the way of the Whigs. And those spending cuts, well… Reagan never saw the ones he was promised when he raised taxes and the Republicans have just about as much chance of seeing these newly promised ones as North Korea has of verifying their unicorn lair. We are sick to death of the Charlie Brown Party. Read my lips: Progressives lie.
Either way, the Left and the media will make the Republicans out to be the bad guys. So, in the face of that, just do the right thing. Stick by conservative principles, close your eyes and jump. I hear the water is fine. It will give the Republicans time to find their moral bearings, grow a spine and start righting the USS Titanic. Make the message about cutting spending which is the real problem anyway. There is no way to tax your way out of this hole.
Do real financial reform… Cut the hell out of government spending, cut taxes and bring America back to greatness. It will create jobs and prosperity. It will create confidence and freedom. It will free us from the shadow of Marxism. It’s an easy choice; it’s the right choice – the question is, does anyone up there have ‘tener cojones’ to do the right thing anymore? They will if they care more about Americans and the Constitution than their crappy political careers.
To do what Obama and the Liberals want is madness. Raise taxes while increasing spending will speed up America’s death spiral. Want massive growth? Go over the fiscal cliff, do away with the IRS and go to a flat sales tax, let small businesses do their own thing and watch America catapult once again into the strongest nation on earth. Or, compromise and push millions into poverty, slavery and violence. I say, let the cliff diving begin!
The Right Planet:It looks to me like the Republicans are faced with a no-win scenario. This became abundantly clear to me when I saw Robert Reich state on Twitter that the Republicans want to “hold the middle class hostage” by denying 98% of Americans a tax cut. Obama is trumpeting a similar theme. (Funny how all of a sudden the progressives are for Bush-era “tax cuts.”) If I understand correctly, the Obama Administration is proposing freezing the tax rate for 98% of Americans for one year if the Republicans agree to raising taxes on the top two tax rates. A number of conservative pundits, like Rush Limbaugh and Charles Krauthammer, are urging the Republicans to just “walk away” from the deal. The problem I have with this approach is it gives Obama everything he wants. It even lets the president raise the debt limit at will, thereby taking away more power from Congress to control the purse strings.
So, if the Republicans walk away from the deal, the liberal media and the Obama Administration will accuse the GOP of raising taxes on the middle class in order to protect “the rich.” But if the Republicans agree to raising taxes on the wealthy, while agreeing to freeze tax rates for the middle class, then they will be accused of selling out. The only reason I believe the Obama Administration is offering to freeze the tax rate on the middle class right now is simply for political expediency; it serves their agenda and backs the GOP into a corner. Looks like Obama and ilk are holding the Republicans hostage.
What’s particularly odious about the maneuvers by the White House et al. is the fact the Obama Administration has not passed a budget in the entire time it has been in office. Obama has offered no serious proposal to reduce any federal spending. As a matter of fact, he wants another stimulus out of the deal. The fact is taxes are going up, period. And I wouldn’t be surprised if the Republicans get all the blame.
The Glittering Eye: I’ve posted on this very subject several times this week. I find both the White House’s and Congressional Republicans’ positions on this subject very frustrating. Both sides are taking positions that appear purely political to me. They appear to be taking an unnecessarily zero-sum view of the negotiations.
Since I opposed the “Bush tax cuts” in 2002-2003, opposed their renewal in 2010, and am still opposed to them as being the wrong taxes to cut, I have no particular fondness for renewing them now. However, I find the notion that raising taxes on just the highest income earners will do much about income inequality, balancing the budget, or much of anything else for that matter pretty far-fetched.
I’d like to see good faith negotiations from both sides. I have no real hope that’s going to happen. I’d also like to see a pro-growth agenda but I have no greater hope that will happen, either.
I don’t think that any nation in the history of the world has either taxed or cost-reduced its way to greatness or prosperity.
Bookworm Room: The Republicans, who still control the house, have three choices: (1) Give Obama everything he wants; (2) Give Obama nothing; and (3) Compromise. Believe it or not, I prefer option (1).
To begin with, compromise is out. Any type of compromise will work to Obama’s benefit. Obama understands this, which is why he presented the Democrats with a laughable compromise offer, one that gives fiscal conservatives absolutely nothing. If the Republicans actually try to negotiate and he slides a little in their direction, he still wins. Obama knows that, with an utterly compliant press, he will take credit for any slight upticks in the economy, while lambasting the Republicans for the economy’s continued slide.
Giving Obama nothing is no better. The Republicans in the House can hark back to the Reagan era and “just say ‘No.’” The problem with that course of action is that it will result in a stalemate. Unfortunately, this stalemate has ticking bombs in it — sequestration and tax increases. Once these happen, the compliant media will again blame the Republicans, while Obama walks away spotless.
The only approach that offers some hope for long-term American stability and fiscally-sound, constitutional capitalism is the most painful one: The Republicans should give Obama everything he wants. They should turn to the American people and say “By re-electing Obama and keeping the Senate majority Democrat, this is what you asked for, so this is what you’ll get. We wash our hands of it. This is truly Obama’s economy now.” Things will happen quickly (and badly) under this scenario, but the Republicans will have kept their noses clean and will have spelled out very clearly for Americans the differences between socialism and constitutional capitalism.
In the short term, these are all Hobson’s choices, since they are all awful. However, it’s only Option (1) — saying to Obama “you own the economy” — that will provide a short, sharp shock sufficiently horrific to scare people away from a Fabian slide into perpetual socialism.
Well, there you have it.
Make sure to tune in every Monday for the Watcher’s Forum. And remember, every Wednesday, the Council has its weekly contest with the members nominating two posts each, one written by themselves and one written by someone from outside the group for consideration by the whole Council. The votes are cast by the Council, and the results are posted on Friday morning.
1 comment:
The simple solution is to tax $0.01 cents on each stock that is traded. This will solve the revenue problem and will not take any new government. The stock exchanges will simply collect the funds along with the cost of the stock, send them to the IRS.
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