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When it comes to fiscal cliff ahead,
which party will be Wily Coyote and
which will be the speeding truck?


By now, you've seen and heard more than you want to know about the fiscal cliff that will confront America in seven weeks.  And now we're hearing voices on both sides calling for compromise in negotiations.  Don't buy it.

There seem to be many dimensions to the issue, but the most important is tax rates.  R's say they want to raise revenues (taxes) by eliminating loopholes, but they have drawn a line in the sand against raising tax rates themselves.  D's say they want to raise revenues by closing loopholes AND raising taxes on the top few percent. Both R's and D's want to trim spending, but in different ways. R's want to cut Social Security, Medicare, Medicaid and Obamacare, while increasing defense spending.  D's want to cut defense spending, and will accept some belt-tightening in other areas.

The Republican position of no tax increases, even for the wealthiest Americans is a non-starter.  If Boehner & Co., truly do draw a line in the sand on that, I say, "Choose the cliff."

"Choosing the cliff" will raise badly needed revenues, restoring our tax system to how it was before the insanity of George Bush. It will bring welcome reductions to our outrageous spending on wars and arms, without jeopardizing our ability to defend ourselves in the slightest.  These are good things, but though there are downsides as well.  As Europe proves every day, austerity economics is a recipe for disaster.

It will be tempting for D's in Washington to believe that R's will compromise and negotiate in good faith. But if there's one thing we've learned over the past four years it is this:  R's will not compromise and negotiate in good faith.  

The creation of the "fiscal cliff" was a drastic response to a unsustainable situation, a compromise of sorts, reached under duress.  Unless D's can get a better compromise that restores tax rates on the highest income earners to pre-Bush levels we should stick with the deal that's on the table.  If that takes America into another recession, so be it. That recession would ignite the full fury of class warfare that has been smoldering for the past few years.

Poll

Choose your cliff

24%6 votes
48%12 votes
16%4 votes
8%2 votes
4%1 votes

| 25 votes | Vote | Results

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Comment Preferences

  •  Howard Dean (1+ / 0-)
    Recommended by:
    rapala

    spoke at UNC in Chapel Hill recently and also recommended "choosing the cliff."

  •  You are ok with risking sliding into recession? (2+ / 0-)
    Recommended by:
    James Protzman, paccoli

    Because according to the CBO, that's the risk you are taking.

    And you are ok with a family of four with a household income of $75,000 paying an additional $4000 or so in federal income taxes when they file their returns this spring, because of the AMT?  Again, that is the risk you are taking. Plus take  home pay for every American will go down significantly starting January 1 on top of that.  Again, that is the risk you are taking.  

    It's fine to take the position, let all of that happen so we don't have to deal with entitlements right now (we certainly will have to deal with Medicare and Medicaid eventually, as the CBO clearly has said that the long-term trajectory for those programs is unsustainable) and so that we can get an extra $70 billion or so a year from families over $250,000 (a fairly small amount when you have an annual budget of $3.5 trillion a year).  

    But to take an intelligent position, you need to be able to say, I understand the risks and consequences, but I think recession and that additional tax burden on the middle class is worth it.  

  •  I am okay with it (1+ / 0-)
    Recommended by:
    paccoli

    because I don't think it will actually happen.  If we choose the cliff, Republicans will scramble like hell to claw its way back to the ledge ... but only after seeing the ground fall out from under their feet.

    And if they don't scramble, I am still okay with the choice.  I, and many others, believe the economy could absorb this body blow and recover in two or three quarters.  

    So yeah, I understand the risks and consequences and believe the additional burden is worth it in order to reestablish a more progressive tax structure.

  •  There is no cliff. (3+ / 0-)

    The fiscal cliff is a manufactured crisis, engineered by a Congress which aims to impose distress on the American people to show them who's the boss.

    Imagine a steward who comes to his master and explains there is nothing left in the cupboard because he's doled all the resources out to his friends. The biblical parable actually explains what is to be done in such a case. The steward has to be fired.
    When there are many stewards acting in concert, it's harder, as we just discovered.

    Now imagine a steward who claims to have run out of something he can produce, like his speech, without limit. Is he to be believed?  No.
    But, don't take my word for it, listen to the experts.


    Why would our representatives perpetuate a lie? Because it gives them power.  Why does the President go along?  Because he is, literally, at their mercy. The executive can only manage those resources, both material and symbolic, the Congress authorizes him to use. When Congress chooses to deprive, rather than provide, it is being abusive and, whenever there's a victim of abuse, even when it is the executive arm of the U.S. government, it requires an intervention from outside. In this case, that intervention has to come from the American people.  After all, we're the ones that hired the Capitol Hill Gang.

    We organize governments to provide benefits and prevent abuse.

    by hannah on Fri Nov 09, 2012 at 06:45:14 AM PST

    •  Fabulous comment (1+ / 0-)
      Recommended by:
      SanFernandoValleyMom

      Wish I had thought to include "There is no cliff" in the poll.  

      Well said.

    •  There is no cliff (0+ / 0-)

      The Economist a few issues back (Oct 13th) had a book review about the Austrian School of Economics - Neoliberals that is a good quick summary of the problem.

      The problem is that Popper, Hayek, Mises and Friedman have become accepted Economic theory to the right.

      Economics is called the "Dismal Science" for a reason, and one part of that is that it's very hard to create test cases for the theories - so "reality" becomes the test cases.

      So now we've had decades of the test case of supply side economics and trickle down since 1980 and the start of "Voodoo Economics" and lower taxes and Laffer curve and all that stuff. Robert  Reich just had an interview in the last day or so on this very subject.

      So I'm not an economist but I guess if I was I'd be a Krugman keynesian. Starting to debunk the underpinnings of the right as far as economics go is the start. And When Bohener starts the claptrap about "Low taxes mean more jobs" refute that - we've had 40 years to show that's not how jobs get created.

      So yes, the "Cliff" is a construct of the right - yes, there will be a small contraction. The very fact that if it shows that the cliff was a figment of imagination will start the dialog that maybe the whole underlying assumptions by the right of how economics works is wrong.

      But this does mean that the Middle class tax temporary relief is desirable but the wealthy tax cut is not - it's not all or nothing, because some tax cuts help IF they stimulate consumption, and those that don't, don't. That's basic Paul Krugman

      Without geometry, life is pointless. And blues harmonica players suck.

      by blindcynic on Fri Nov 09, 2012 at 10:52:12 AM PST

      [ Parent ]

  •  Brinkmanship - how to save France from Hitler (2+ / 0-)
    Recommended by:
    paccoli, James Protzman

    When Hitler and the Wehrmacht "entered" the Rhineland in 1936, they broke the Treaty of Versailles.  It was a bluff.  The Germans were, at that time, militarily unprepared, outgunned, outmanned.

    The "won" because the French let them.

    I don't think the outgoing House is bluffing.  They are deadly serious.  Didn't Boehner change course yesterday to tweet they're still trying to repeal Obamacare?

    So the House Repubs, dominated by teabaggers are more like Kamikazes.  They think they're the "Divine Wind."

    When they're flatulence.

    Stick to our policies.  Let taxes rise!  But be very sure the narrative is that they're rising because of Republican intransigence.

    As the 2012 election shows, the public will support better policy.  And vote for those who speak truth.

  •  Revenues and the (1+ / 0-)
    Recommended by:
    James Protzman

    Just a simple question...

    What would be the effect of canceling all deductions and credits, or at least phasing them out progressively, for all those making more than $250,000 per year.  Tax rates don't have to go up (a win for the Republicans), revenue is increased (a win for the President), and everybody is happy.  Well, not really, but it is a win-win situation.

    Comments?

    I am a 67 year old teacher...teaching computer applications in a Texas high school. I've already retired once but it didn't take.

    by 43yearsateacher on Fri Nov 09, 2012 at 08:57:24 AM PST

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