Fiscal Chicken

by Walter Brasch

Talk show hosts and other bloviators have spent hours giving their versions of the fiscal cliff.

In fewer than 750 words, I’ll explain the truth.

Taxes and the deficit are intertwined. If Congress can’t come up with a plan to solve those problems, the U.S. will jump into the abyss of a deeper recession than existed under the latter years of the Bush-Cheney administration.

Let’s first look at taxes.

The Bush tax cuts expire at the end of this year.

The idea of the cuts was to spur the economy and give what is loosely called the “jobs creators” a slight push to hire more people.

But, the millionaire “jobs creators” held onto their money. They continued to downsize and outsource jobs, making even more money-which they used to buy whatever trinkets that rich people spend money on.

If Congress can’t agree on tax rates, beginning Jan. 1, 2013, every American will see a restoration of tax rates to a level that is about what they were before the Bush tax cuts. The lower- and middle-classes will be hit harder than the upper class.

President Obama, contrary to what the screaming harpies of the extreme Rightwing claim, doesn’t want to raise taxes. He wants the tax cuts to continue for 98 percent of all Americans-the ones making less than $250,000 a year. He wants to restore-note that word, restore, not raise-the tax liability for the richest 2 percent of Americans. The rate to the rich would still be below the rates they paid during most of the latter half of the 20th century. Even billionaires like Bill Gates and Warren Buffet agree that the rich need to be paying more.

The Republicans, knowing where their financial base is, demand that the tax cuts be extended to everyone. Their compromise was to allow the cuts to apply to everyone making $1 million a year or less. That would be net income, not gross income. Millionaires could still make $3 million a year if they can scam $2 million in deductions. Their rates would still be lower than almost any time since the income tax was first created in 1913.

The President countered with a $400,000 limit. That would include about 99 percent of all Americans. House Speaker John Boehner, however, found that a segment of his Republican party don’t want a compromise; they are determined to uphold some kind of a non-legal pledge to Grover Norquist that there would be no tax increases-ever-even if it is to restore, not raise, tax rates.

The second part of the problem is that of entitlements. The Republicans are willing to do some horse-trading. They won’t continue to hold 99 percent of Americans hostage if there are cuts in “entitlements” and programs that would significantly reduce the deficit. These entitlements benefit mostly the 99 percent. The Republicans even say they’ll consider closing some tax loopholes used extensively by the upper class. But, they won’t tell us what those loopholes are, even though the President has several times asked for specifics. Apparently, the Republicans believe releasing such information is classified, much like battle plans in Afghanistan or the number of toilet paper rolls the Pentagon buys.

The President has already compromised several times, but every time he makes a concession, the Republicans want even more. He has proposed an orderly reduction of the deficit by $1.6 trillion. Not good enough, say the dogma-driven Republicans. They want even more. And they want it now. They are aware that if the tax cuts expire all at once, the deficit immediately decreases, something that makes them drool in ecstasy. However, almost every economist of every political persuasion says a severe decrease in the deficit would lead the U.S. into an even worse recession than the one created by the Bush-Cheney administration.

Behind a wall of political gesturing, the Republicans are doing nothing, while blocking those who can do something. John Boehner now acknowledges he is blocked by party dogma and can’t control the Republican majority in the House who want the government to several cut entitlements while continuing all Bush tax cuts, even to millionaires who, not surprisingly, make up the majority of Congress. Their actions are driving America into fiscal cliff suicide.

The obstructionists in Congress need to realize this isn’t a deserted two-lane highway, and Americans don’t want the Republicans playing chicken with our nest eggs.

[Walter Brasch, a social issues columnist, has covered politics and government for four decades. His latest book is Before the First Snow: Stories from the Revolution.]

 

Republicans Hold Jobless Hostage For the Rich

The real Republican agenda was exposed yesterday when they released a letter the GOP Senate delegation signed agreeing to hold all pending legislation hostage for their tax cuts to the richest Americans.  They will not allow any legislation to move forward until they get their way just like a five year old screaming in Toys R Us until they get their toy.

No sooner did the GOP leadership leave the Slurpee Summit then they reneged on any sort of bipartisanship.  A clueless Barack Obama is Charlie Brown to the Republican’s Lucy as they, once again, yanked the football and made him look like a fool.  He is a fool for continuing to believe they have the country’s interests at heart, that they actually want to cut the deficit or that that they can be trusted.

Didn’t the entire GOP team campaign on deficit reduction this year?  Didn’t they also cry for job creation?  Anyone who believed those claims was also a fool.  The Republicans created the massive federal debt and thinking they’d cut the deficit means being on acid.  This party exists for the rich and the rich are the people are funded those hundreds of millions worth of ads all fall.  Wall Street executives wrote $20 million checks to the likes of Crossroads GPS and the other Republican front groups just for this sort of stand:  tax cuts for the rich trump everything else.

As 2 million Americans lose their unemployment benefits and another 5 million stand to do the same next year what is the number one policy agenda item for the GOP?  Extend the tax cuts for the richest 2% of the country.  Never mind they’re responsible for $700 billion of the deficit these hypocrites demand the unemployment benefits be paid for but not the tax cuts.  Allowing them to expire will pay for the checks to those Wall Street threw out of work yet Wall Street will still get their massive tax cuts.  Working people get screwed so the rich can benefit.

Now explain to me why you voted Republican this year?  Yes, you’re Charlie Brown falling on your butt too.