Breaking pledges

Republican lawmakers are bailing on the formal pledge they made not to vote for a tax increase.

Grover Norquist’s anti-tax pledge has been a sacred and unchallenged keystone of the Republican platform for more than two decades, playing a central role in almost every budget battle in Congress since 1986. But Norquist and his pledge, signed by 95 percent of congressional Republicans, are now in danger of becoming Washington relics as more and more defectors inch toward accepting tax increases to avert the “fiscal cliff.”

On Monday, Sen. Bob Corker (Tenn.) became the latest in a handful of prominent Republican lawmakers to take to the airwaves in recent days and say they are willing to break their pledge to oppose all tax increases.

“I’m not obligated on the pledge,” Corker told CBS’s Charlie Rose. “I made Tennesseans aware, I was just elected, the only thing I’m honoring is the oath I take when I serve when I’m sworn in this January.”

House Majority Leader Eric Cantor (R-Va.) also suggested Monday that Norquist’s anti-tax pledge would not dictate the GOP’s strategy on the fiscal cliff, raising questions across Washington about whether Norquist’s ironclad hold on the Republican Party has loosened. . . .

Even House Speaker John A. Boehner (R-Ohio) expressed dismay with Norquist’s pledge and his role in the GOP at the time. . . .

Last November, 100 House members, 40 of them Republicans, wrote a letter to Congress’s deficit-reduction “supercommittee” urging it to consider all options — a vague pronouncement that, at least in theory, endorsed tax increases forbidden by Norquist. A number of House members, including freshman Rep. Scott Rigell (R-Va.), said openly that they no longer felt bound by the pledge they had signed when running for office. Rigell was reelected this month. . . .

And now, with severe cuts in line if Congress doesn’t reach a deal on the fiscal cliff, coming to an agreement is paramount. Analysts have a hard time forecasting a deal that doesn’t include tax increases — especially after President Obama won reelection, having run in large part on letting tax cuts for the wealthy expire.

Some Republicans are bowing to that version of reality. Over the weekend and on Monday, Sens. Lindsey O. Graham (S.C.), Saxby Chambliss (Ga.) and Corker (Tenn.), along with Rep. Peter T. King (N.Y.), said they would be willing to violate the pledge under the right circumstances.

via Will the fiscal cliff break Grover Norquist’s hold on Republicans? – The Washington Post.

Now I can agree that it is foolish to bind oneself in a pledge like this.  There may well be a time when it is in the republic’s interest to raise taxes.  Perhaps this is such a time.  But it is still highly unethical to violate one’s word.  (And how about Scott Rigell not feeling bound by the pledge because he made it while running for office?  As if campaign promises, by definition, don’t need to be kept!)

But if lawmakers no longer believe in what they once pledged, they still are obliged to keep that pledge.   The honorable course of action would be to resign their office so that their governor can appoint someone who has not made the pledge.

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • SKPeterson

    Preemptive surrender, unfortunately. Unless I want to be deviously Machiavellian and say that reneging on the pledge doesn’t really mean I’m reneging on the pledge and I can sucker the other guy into giving something away under the false premise that I am giving something up as well. I doubt that level of thought has gone into it; it bears more the mark of “wanting to be taken seriously” by WaPo, or the NYT, or “people who are important.”

    These Republicans are really showing that they cannot bear the thought of there actually being meaningful cuts to government programs across the board. They have a desire to protect their favored constituency (not to be confused with their constituents back home). They will now trade tax increases to allow for either increased defense spending or only minimal cuts to that most bloated sector of the government. This simply points out the fact that both parties are parties of big government, they just each have different spending priorities and favored sacred cows they don’t want sacrificed. For the Republicans and the Democrats the only good sacrifices made for the cause of “good” government are those to be made by the taxed and ignored.

    But if lawmakers no longer believe in what they once pledged, they still are obliged to keep that pledge. The honorable course of action would be to resign their office so that their governor can appoint someone who has not made the pledge.

    Ha ha ha. You used the word ‘honorable’ in the same context as ‘Republican lawmaker.’ Good one, Veith. Good one.

  • SKPeterson

    Preemptive surrender, unfortunately. Unless I want to be deviously Machiavellian and say that reneging on the pledge doesn’t really mean I’m reneging on the pledge and I can sucker the other guy into giving something away under the false premise that I am giving something up as well. I doubt that level of thought has gone into it; it bears more the mark of “wanting to be taken seriously” by WaPo, or the NYT, or “people who are important.”

    These Republicans are really showing that they cannot bear the thought of there actually being meaningful cuts to government programs across the board. They have a desire to protect their favored constituency (not to be confused with their constituents back home). They will now trade tax increases to allow for either increased defense spending or only minimal cuts to that most bloated sector of the government. This simply points out the fact that both parties are parties of big government, they just each have different spending priorities and favored sacred cows they don’t want sacrificed. For the Republicans and the Democrats the only good sacrifices made for the cause of “good” government are those to be made by the taxed and ignored.

    But if lawmakers no longer believe in what they once pledged, they still are obliged to keep that pledge. The honorable course of action would be to resign their office so that their governor can appoint someone who has not made the pledge.

    Ha ha ha. You used the word ‘honorable’ in the same context as ‘Republican lawmaker.’ Good one, Veith. Good one.

  • http://enterthevein.wordpress.com J. Dean

  • http://enterthevein.wordpress.com J. Dean

  • http://theoldadam.com/ Steve Martin

    One cannot be a party to giving away more stuff without raising taxes.

    “honorable” and politician seem to be oxymorons.

  • http://theoldadam.com/ Steve Martin

    One cannot be a party to giving away more stuff without raising taxes.

    “honorable” and politician seem to be oxymorons.

  • James Sarver

    “But if lawmakers no longer believe in what they once pledged, they still are obliged to keep that pledge. The honorable course of action would be to resign their office so that their governor can appoint someone who has not made the pledge.”

    Good luck to the Governors (who surely will act honorably!) finding folks to appoint who don’t have a public position on anything that they might act against at some point in their term. Otherwise all that honorable “falling on their own swords” is going to keep the Governors very busy trying to keep a quorum available to carry on any business.

  • James Sarver

    “But if lawmakers no longer believe in what they once pledged, they still are obliged to keep that pledge. The honorable course of action would be to resign their office so that their governor can appoint someone who has not made the pledge.”

    Good luck to the Governors (who surely will act honorably!) finding folks to appoint who don’t have a public position on anything that they might act against at some point in their term. Otherwise all that honorable “falling on their own swords” is going to keep the Governors very busy trying to keep a quorum available to carry on any business.

  • Michael B.

    Even dumber than the idea of pledging not to increase taxes is the person who believes him. When you demand politicians not cut taxes, even after increased spending, what do you expect to happen? Either they increase taxes, or they enact massive spending cuts (for programs that their constituents love). Can I ask what you expected to happen? If I say I’m going to send you a $5000 check and you don’t have to do anything, would you believe me?

  • Michael B.

    Even dumber than the idea of pledging not to increase taxes is the person who believes him. When you demand politicians not cut taxes, even after increased spending, what do you expect to happen? Either they increase taxes, or they enact massive spending cuts (for programs that their constituents love). Can I ask what you expected to happen? If I say I’m going to send you a $5000 check and you don’t have to do anything, would you believe me?

  • http://derekjohnsonmuses.com Derek Johnson

    I get the purpose of the pledge, and if I guy signed it while running for office, I can see why people would be upset if they didn’t keep to it. But even if yo took this pledge, we have to look at the situation with the deficit; we’re not getting out of it without a tax hike, and it’s going to have to be one the middle class.

  • http://derekjohnsonmuses.com Derek Johnson

    I get the purpose of the pledge, and if I guy signed it while running for office, I can see why people would be upset if they didn’t keep to it. But even if yo took this pledge, we have to look at the situation with the deficit; we’re not getting out of it without a tax hike, and it’s going to have to be one the middle class.

  • Tyler

    Agreed. I have long thought that this pledge was a terrible idea for Republicans. Any sort of tax reform, something Republicans say they support, but never seem to work towards, would surely raise taxes on someone somewhere in some instance. Rather than sign this pledge, many of these politicians should have worked towards a clean overhaul of our tax code as we know it. Instead, we’ve been playing a game of temporary tax cuts (marginal at best) with potential tax hikes. Nothing has been permanent, nothing has been lasting, and it has caused unending problems in the economic sphere.

  • Tyler

    Agreed. I have long thought that this pledge was a terrible idea for Republicans. Any sort of tax reform, something Republicans say they support, but never seem to work towards, would surely raise taxes on someone somewhere in some instance. Rather than sign this pledge, many of these politicians should have worked towards a clean overhaul of our tax code as we know it. Instead, we’ve been playing a game of temporary tax cuts (marginal at best) with potential tax hikes. Nothing has been permanent, nothing has been lasting, and it has caused unending problems in the economic sphere.

  • SAL

    I am opposed to pledges. The Oath of office is pledge enough if politicians would just stick to that. That 99% of politicians break their oath of office suggests other pledges aren’t held by honor.

    What keeps the Republican politicians in line is the fear that their constituents and donors will replace them in a primary if they capitulate to the other party.

  • SAL

    I am opposed to pledges. The Oath of office is pledge enough if politicians would just stick to that. That 99% of politicians break their oath of office suggests other pledges aren’t held by honor.

    What keeps the Republican politicians in line is the fear that their constituents and donors will replace them in a primary if they capitulate to the other party.

  • Norman Teigen

    Grover’s over.

  • Norman Teigen

    Grover’s over.

  • Random Lutheran

    While no one I know actually expects politicians to keep their pledges (experience shows that that only leads to disappointment and cynicism), it should be enough to drive them out of office that they were dumb/craven enough to sign this pledge in the first place. They willingly tied their hands as legislators, making it nigh impossible for them to actually do their jobs, while at the same time giving the Democrats a stick with which to smack them in front of the voting populace (Slaves of Grover! Obstructionists! Etc., etc.!). The insane part is that a whole party allowed itself to be held hostage by this silliness, and by one man. Could it be a decent general policy to try to stick to? Sure. But there comes a time when good governance and sense has to trump party. The Republicans are paying for allowing party interests to trump the national interest.

  • Random Lutheran

    While no one I know actually expects politicians to keep their pledges (experience shows that that only leads to disappointment and cynicism), it should be enough to drive them out of office that they were dumb/craven enough to sign this pledge in the first place. They willingly tied their hands as legislators, making it nigh impossible for them to actually do their jobs, while at the same time giving the Democrats a stick with which to smack them in front of the voting populace (Slaves of Grover! Obstructionists! Etc., etc.!). The insane part is that a whole party allowed itself to be held hostage by this silliness, and by one man. Could it be a decent general policy to try to stick to? Sure. But there comes a time when good governance and sense has to trump party. The Republicans are paying for allowing party interests to trump the national interest.

  • SKPeterson

    Derek @ 6 – Why do you assume that a tax hike is necessary? I’d like to see a proposal for serious and credible spending decreases sustained over several years. Like say cutting 5% per year for 10 years or more might be a good start. A start. Eliminating whole departments (Labor, Commerce, Education, Energy, Agriculture, Health and Human Services, Veterans Affairs, Interior, EPA, SEC) and major reductions in many of the rest (the Intelligence Community, Transportation, Justice, Treasury, State, and Defense) are absolutely necessary to achieve a sane fiscal balance that begins to rein the federal government into its proper Constitutional sphere. That is what is most needed. We’ve had tax increases in the past to deal with the deficit; they have almost always been associated with even greater levels of spending. I am in no way convinced that increasing taxes is in any way a necessary precondition for dealing with our government’s finances. And, since neither party gives a rip about the Constitution, or the separation of powers, or the rule of law, or the basic principle of federalism, but worships at the idol of the state (look at the flag! pledge your allegiance without thinking! war! fear the terrorists! fear the corporations! fear the lack of insurance! fear the immigrants! fear competition! fear! fear! fear! all good patriots are always afraid and need their government to keep the nightlights on!)

    To build on what Norman says @ 9 -

    Grover may be over, but the spending needs to be ending.

  • SKPeterson

    Derek @ 6 – Why do you assume that a tax hike is necessary? I’d like to see a proposal for serious and credible spending decreases sustained over several years. Like say cutting 5% per year for 10 years or more might be a good start. A start. Eliminating whole departments (Labor, Commerce, Education, Energy, Agriculture, Health and Human Services, Veterans Affairs, Interior, EPA, SEC) and major reductions in many of the rest (the Intelligence Community, Transportation, Justice, Treasury, State, and Defense) are absolutely necessary to achieve a sane fiscal balance that begins to rein the federal government into its proper Constitutional sphere. That is what is most needed. We’ve had tax increases in the past to deal with the deficit; they have almost always been associated with even greater levels of spending. I am in no way convinced that increasing taxes is in any way a necessary precondition for dealing with our government’s finances. And, since neither party gives a rip about the Constitution, or the separation of powers, or the rule of law, or the basic principle of federalism, but worships at the idol of the state (look at the flag! pledge your allegiance without thinking! war! fear the terrorists! fear the corporations! fear the lack of insurance! fear the immigrants! fear competition! fear! fear! fear! all good patriots are always afraid and need their government to keep the nightlights on!)

    To build on what Norman says @ 9 -

    Grover may be over, but the spending needs to be ending.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Are enormous deficits and debt in the republic’s national interest?

    I wonder if this is about a debt downgrade because if those who buy T-bills see that the congress will not raise taxes/people won’t pay more, then that jeopardizes their investment. Right now you hear so much about investors looking for safety and fleeing risk that it makes me wonder if that is what Republicans fear. We know few of them have principles, but they do have self interest and it doesn’t seem that another debt downgrade would be in their self interest.

    Also, Congress may fear that levels of social cohesion are too low for people to endure more hardship. I don’t know if that is true, but some have suggested it.
    http://www.nytimes.com/2010/03/16/business/global/16rating.html?_r=0

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Are enormous deficits and debt in the republic’s national interest?

    I wonder if this is about a debt downgrade because if those who buy T-bills see that the congress will not raise taxes/people won’t pay more, then that jeopardizes their investment. Right now you hear so much about investors looking for safety and fleeing risk that it makes me wonder if that is what Republicans fear. We know few of them have principles, but they do have self interest and it doesn’t seem that another debt downgrade would be in their self interest.

    Also, Congress may fear that levels of social cohesion are too low for people to endure more hardship. I don’t know if that is true, but some have suggested it.
    http://www.nytimes.com/2010/03/16/business/global/16rating.html?_r=0

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    “Grover may be over, but the spending needs to be ending.”

    a la Rick Santelli at the beginning of this video:

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    “Grover may be over, but the spending needs to be ending.”

    a la Rick Santelli at the beginning of this video:

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Eliminating whole departments (Labor, Commerce, Education, Energy, Agriculture, Health and Human Services, Veterans Affairs, Interior, EPA, SEC) and major reductions in many of the rest (the Intelligence Community, Transportation, Justice, Treasury, State, and Defense) are absolutely necessary to achieve a sane fiscal balance that begins to rein the federal government into its proper Constitutional sphere.

    Are you kidding? Do you have any idea how many women work safe easy secure jobs in those bureaucracies? Many of those people are largely unemployable elsewhere because they can’t compete with better workers in the private sector. Those bureaucracies are giant jobs programs. They are worse than the Detroit public schools where the employee to student ratio is 1:4.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Eliminating whole departments (Labor, Commerce, Education, Energy, Agriculture, Health and Human Services, Veterans Affairs, Interior, EPA, SEC) and major reductions in many of the rest (the Intelligence Community, Transportation, Justice, Treasury, State, and Defense) are absolutely necessary to achieve a sane fiscal balance that begins to rein the federal government into its proper Constitutional sphere.

    Are you kidding? Do you have any idea how many women work safe easy secure jobs in those bureaucracies? Many of those people are largely unemployable elsewhere because they can’t compete with better workers in the private sector. Those bureaucracies are giant jobs programs. They are worse than the Detroit public schools where the employee to student ratio is 1:4.

  • Econ Jeff

    Looking at the Pledge’s FAQ’s, I’m a bit surprised that anybody would agree to it. For example:
    “Do I have to take the Pledge again if I run for re-election?

    No. Elected officials who have taken the Pledge make a commitment to taxpayers for the duration of their tenure in the office to which they are elected.

    Read more: http://atr.org/federal-taxpayer-protection-questions-answers-a6204#ixzz2DWtEarhS
    Follow us: @taxreformer on Twitter”

    Is this reasonable? Was this understood by the signers? Was this condition that was added later on?

    Note that the pledge itself does not suggest that it is perpetual. What if some signers thought it meant for the current Congress? If that’s the case, and this has been around since the 1980s, then I wouldn’t hold them accountable for their signature to what could arguably a relic of the past.

    That is, those who did not sign it during their current run for office probably shouldn’t be held to it.

  • Econ Jeff

    Looking at the Pledge’s FAQ’s, I’m a bit surprised that anybody would agree to it. For example:
    “Do I have to take the Pledge again if I run for re-election?

    No. Elected officials who have taken the Pledge make a commitment to taxpayers for the duration of their tenure in the office to which they are elected.

    Read more: http://atr.org/federal-taxpayer-protection-questions-answers-a6204#ixzz2DWtEarhS
    Follow us: @taxreformer on Twitter”

    Is this reasonable? Was this understood by the signers? Was this condition that was added later on?

    Note that the pledge itself does not suggest that it is perpetual. What if some signers thought it meant for the current Congress? If that’s the case, and this has been around since the 1980s, then I wouldn’t hold them accountable for their signature to what could arguably a relic of the past.

    That is, those who did not sign it during their current run for office probably shouldn’t be held to it.

  • Patrick kyle

    Of course they are breaking their word. They lied to us about how bad it really is to begin with. The math is unavoidable. Here is Carl Denninger breaking down why we are in trouble, using the government’s own numbers. Simply devastating.

  • Patrick kyle

    Of course they are breaking their word. They lied to us about how bad it really is to begin with. The math is unavoidable. Here is Carl Denninger breaking down why we are in trouble, using the government’s own numbers. Simply devastating.

  • Klasie Kraalogies

    While SKP has a point about spending, we should remember that the last thing the US can afford is a (political) stalemate – that nothing is done. Therefore some compromise will have to happen.

  • Klasie Kraalogies

    While SKP has a point about spending, we should remember that the last thing the US can afford is a (political) stalemate – that nothing is done. Therefore some compromise will have to happen.

  • Rose
  • Rose
  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @17 Can you explain why you think stalemate is so bad?

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @17 Can you explain why you think stalemate is so bad?

  • SKPeterson

    KK @ 17 – Stop your atheist screed against God’s own anointed America right now!

    Wait. That must be for a different thread. ;)

  • SKPeterson

    KK @ 17 – Stop your atheist screed against God’s own anointed America right now!

    Wait. That must be for a different thread. ;)

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    The average Social Security check has increased 25% in that time.

    According to the census bureau, per capita income in 2000 was $22,346 and in 2011 it was $27,554. However, evaluated in 2011 dollars it was $29,185 in 2000, and in 2011 $27,554. A drop of $1631 (5.6%) in purchasing power, I assume, which comports with what you are saying. So, the Fed created inflation is a tax that the Republicans are perhaps going along with, right? Or not?

    Also, what is today’s deficit/debt in 2000 dollars, 1990 dollars, 1980 dollars, etc? Is the strategy of inflating even making a relative dent?

    I mean when every house costs $1 million, people are going to start catching on, right?

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    The average Social Security check has increased 25% in that time.

    According to the census bureau, per capita income in 2000 was $22,346 and in 2011 it was $27,554. However, evaluated in 2011 dollars it was $29,185 in 2000, and in 2011 $27,554. A drop of $1631 (5.6%) in purchasing power, I assume, which comports with what you are saying. So, the Fed created inflation is a tax that the Republicans are perhaps going along with, right? Or not?

    Also, what is today’s deficit/debt in 2000 dollars, 1990 dollars, 1980 dollars, etc? Is the strategy of inflating even making a relative dent?

    I mean when every house costs $1 million, people are going to start catching on, right?

  • Klasie Kraalogies

    sg – it’s not rocket science. A stalemate means that nothing is done about the “fiscal cliff” – more like a slope, actually. Thus the problems are not properly addressed, either by the increase tax or reduce benefits side, and everything just continues to spiral.

    Plus, world markets run just as much on sentiment as anything else. No deal means an increase in uncertainty, making the markets more jittery (world wide), with global negative affects.

    Uncertainty is the worst enemy of economic prosperity. One might want to say that that is not right – fine, but that is the way things are.

  • Klasie Kraalogies

    sg – it’s not rocket science. A stalemate means that nothing is done about the “fiscal cliff” – more like a slope, actually. Thus the problems are not properly addressed, either by the increase tax or reduce benefits side, and everything just continues to spiral.

    Plus, world markets run just as much on sentiment as anything else. No deal means an increase in uncertainty, making the markets more jittery (world wide), with global negative affects.

    Uncertainty is the worst enemy of economic prosperity. One might want to say that that is not right – fine, but that is the way things are.

  • Klasie Kraalogies

    SKP – you found me out! :)

  • Klasie Kraalogies

    SKP – you found me out! :)

  • MarkB

    All this means is that there will be tax increases and a concurrent increase in spending, because congress cannot slay the spending dragon. They, all Republican and Democrat alike, are committed to maintaining their status and office. That is in opposition to actually governing well.

    This also means that those who are fiscal conservatives in a Libertarian sense will disavow any ties with the national Republican party. So if this does happen, which I don’t doubt for a minute, then groups similar to and including the TEA Party will need to work on the grass roots level to pursue election of fiscal conservatives with a libertarian bent. They also should look to the formation of a new party. It will take several cycles of the presidential election for this to take hold, but they can nolonger count on the Republicans being amenable to their ideas and programs. So that will mean that Republican presidential candidates will lose several elections in the future until either the TEA Party forms a coalition large enough to provide a viable candidate or they collapse.

  • MarkB

    All this means is that there will be tax increases and a concurrent increase in spending, because congress cannot slay the spending dragon. They, all Republican and Democrat alike, are committed to maintaining their status and office. That is in opposition to actually governing well.

    This also means that those who are fiscal conservatives in a Libertarian sense will disavow any ties with the national Republican party. So if this does happen, which I don’t doubt for a minute, then groups similar to and including the TEA Party will need to work on the grass roots level to pursue election of fiscal conservatives with a libertarian bent. They also should look to the formation of a new party. It will take several cycles of the presidential election for this to take hold, but they can nolonger count on the Republicans being amenable to their ideas and programs. So that will mean that Republican presidential candidates will lose several elections in the future until either the TEA Party forms a coalition large enough to provide a viable candidate or they collapse.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    A stalemate means that nothing is done about the “fiscal cliff” – more like a slope, actually. Thus the problems are not properly addressed, either by the increase tax or reduce benefits side, and everything just continues to spiral.

    Okay, but isn’t everything going to continue to spiral anyway?

    With regard to sentiment, is it just that if the congress “does something” however ineffective, it indicates that they haven’t hit some sort of ideological impasse, or what do you mean?

    The numbers are terrible no matter what they do, so it isn’t the numbers per se because they are kind of unfixable without major restructuring that would necessarily induce at least recession if not depression, right? So, this is just to assure everyone that the can has been kicked, right?

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    A stalemate means that nothing is done about the “fiscal cliff” – more like a slope, actually. Thus the problems are not properly addressed, either by the increase tax or reduce benefits side, and everything just continues to spiral.

    Okay, but isn’t everything going to continue to spiral anyway?

    With regard to sentiment, is it just that if the congress “does something” however ineffective, it indicates that they haven’t hit some sort of ideological impasse, or what do you mean?

    The numbers are terrible no matter what they do, so it isn’t the numbers per se because they are kind of unfixable without major restructuring that would necessarily induce at least recession if not depression, right? So, this is just to assure everyone that the can has been kicked, right?

  • Jim Hamilton

    I know this has been said before, but I guess it bears repeating. Anyone who believes anything that a politician says is a fool. Every once in a while, I go on an extended news blackout. These are wonderful times. When I check on the news again, (surprise!) nothing has changed. Republicans say they want to reduce the size of government and then do absolutely nothing to accomplish that. Democrats claim they’re “concerned” about spending and intend to cut it “responsibly.” Obviously, this means raising taxes and increasing spending. Same old horsesh*t, different day. But, really, what does any of this matter? This whole present creation is ash anyway.

  • Jim Hamilton

    I know this has been said before, but I guess it bears repeating. Anyone who believes anything that a politician says is a fool. Every once in a while, I go on an extended news blackout. These are wonderful times. When I check on the news again, (surprise!) nothing has changed. Republicans say they want to reduce the size of government and then do absolutely nothing to accomplish that. Democrats claim they’re “concerned” about spending and intend to cut it “responsibly.” Obviously, this means raising taxes and increasing spending. Same old horsesh*t, different day. But, really, what does any of this matter? This whole present creation is ash anyway.

  • SAL

    If Republicans were shrewd they’d come out in favor of the fiscal cliff arguing it was just a return to Clinton era taxes and spending, and a first down payment on deficit reduction.

    We’re going to need much more painful actions than the fiscal cliff to avoid default.

  • SAL

    If Republicans were shrewd they’d come out in favor of the fiscal cliff arguing it was just a return to Clinton era taxes and spending, and a first down payment on deficit reduction.

    We’re going to need much more painful actions than the fiscal cliff to avoid default.

  • Cincinnatus

    Actually, it seems to me that, given the automatic cuts activated by the so-called “fiscal cliff” (named such by alarmists), a stalemate is desirable. Everyone knows that, if Congress actually agrees to do anything, it will be less effective than the automatic cuts.

    Bring on the cliff, I say.

  • Cincinnatus

    Actually, it seems to me that, given the automatic cuts activated by the so-called “fiscal cliff” (named such by alarmists), a stalemate is desirable. Everyone knows that, if Congress actually agrees to do anything, it will be less effective than the automatic cuts.

    Bring on the cliff, I say.

  • fjsteve

    Pledge or not, the Congress members who vote for a tax hike will face judgement in the next vote. Of course that means most Democrats will be re-elected because their constituency make either too much or too little money to be impacted in any significant way by tax hikes. Republicans, on the other hand, will have to face the music if they neglect the nearly half the population who put them into office to pander to the half who didn’t.

  • fjsteve

    Pledge or not, the Congress members who vote for a tax hike will face judgement in the next vote. Of course that means most Democrats will be re-elected because their constituency make either too much or too little money to be impacted in any significant way by tax hikes. Republicans, on the other hand, will have to face the music if they neglect the nearly half the population who put them into office to pander to the half who didn’t.

  • http://homewardbound-cb.blogspot.com ChrisB

    Political realities will require some kind of tax revenue increase. Better to be a partner and minimize the damage than have it done to you. The automatic and blind across the board spending cuts are too risky to allow them to actually happen, and they all know it.

  • http://homewardbound-cb.blogspot.com ChrisB

    Political realities will require some kind of tax revenue increase. Better to be a partner and minimize the damage than have it done to you. The automatic and blind across the board spending cuts are too risky to allow them to actually happen, and they all know it.

  • Jim Hamilton

    In a way, a very, very serious financial collapse might be the best thing for this country long-term. Obviously, such an event would bring great hardship and ideally would never happen. But our jackass politicians in DC and the fools who keep re-electing them seem to think that the borrowing and spending and money-printing and can-kicking can continue forever with no repercussions. It can’t. We’re broke and getting broker each day. Maybe an economic calamity will open peoples’ eyes and teach them that we all need to depend on ourselves and our families and our God and stop looking to Washington for the solution to all our problems.

  • Jim Hamilton

    In a way, a very, very serious financial collapse might be the best thing for this country long-term. Obviously, such an event would bring great hardship and ideally would never happen. But our jackass politicians in DC and the fools who keep re-electing them seem to think that the borrowing and spending and money-printing and can-kicking can continue forever with no repercussions. It can’t. We’re broke and getting broker each day. Maybe an economic calamity will open peoples’ eyes and teach them that we all need to depend on ourselves and our families and our God and stop looking to Washington for the solution to all our problems.

  • Jim Hamilton

    The good news for tax increase groupies is that regardless of whether or not personal and business income tax rates increase, Obamacare will deliver a savage gutpunch of tax increases as well! Sweet victory for the “all creation belongs to the government” crowd.

  • Jim Hamilton

    The good news for tax increase groupies is that regardless of whether or not personal and business income tax rates increase, Obamacare will deliver a savage gutpunch of tax increases as well! Sweet victory for the “all creation belongs to the government” crowd.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @30 why?

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @30 why?

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    What really bugs me is the debt. I would rather give money to crack addicts than see my tax dollars go for debt service. That is just flushing money down the toilet. The more debt we have, the greater the fraction of our taxes going to debt service.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    What really bugs me is the debt. I would rather give money to crack addicts than see my tax dollars go for debt service. That is just flushing money down the toilet. The more debt we have, the greater the fraction of our taxes going to debt service.

  • DonS

    As usual, the media establishment is putting all of the pressure on Republicans to “solve” the fiscal cliff by caving in to Obama’s demands. Some Republicans are responding to this media pressure by negotiating against themselves in the media, falling over themselves to capitulate on the tax issue while receiving absolutely no accommodation from Democrats on spending. Medicare is “off the table”, Social Security is “off the table”, and tax rates must go up on the “wealthy” defined as a two-earner family making $250,000, even in high expense areas like NYC. He also wants to eliminate the debt ceiling issue by either doing away with the whole concept or at least raising it by $5 trillion or so so he does not have to deal with it again in his presidency.

    Republicans should put a package together proposing a 6 month extension of all Bush tax cuts, a 6 month extension of the debt ceiling, and an offer to use that 6 month window to negotiate a comprehensive tax reform measure, to flatten and lower tax rates, in combination with sharp reductions on deductions and credits, and elimination of the AMT, coupled with mandatory spending reforms, including entitlement reforms. The goal should be a balanced budget within 5-10 years, firm, with an appropriate sliding debt limit — increased tax revenues from the new tax system being offset by sharply reduced compliance costs, and linked to firm spending cuts.

    If Obama demagogues on the tax issue, and refuses the deal, they should let the fiscal cliff happen, and refuse to raise the debt limit until he comes to the table. At the same time, Republicans need to put up ads explaining their moves to the public, and asking for support, since they know the media will not do so fairly.

  • DonS

    As usual, the media establishment is putting all of the pressure on Republicans to “solve” the fiscal cliff by caving in to Obama’s demands. Some Republicans are responding to this media pressure by negotiating against themselves in the media, falling over themselves to capitulate on the tax issue while receiving absolutely no accommodation from Democrats on spending. Medicare is “off the table”, Social Security is “off the table”, and tax rates must go up on the “wealthy” defined as a two-earner family making $250,000, even in high expense areas like NYC. He also wants to eliminate the debt ceiling issue by either doing away with the whole concept or at least raising it by $5 trillion or so so he does not have to deal with it again in his presidency.

    Republicans should put a package together proposing a 6 month extension of all Bush tax cuts, a 6 month extension of the debt ceiling, and an offer to use that 6 month window to negotiate a comprehensive tax reform measure, to flatten and lower tax rates, in combination with sharp reductions on deductions and credits, and elimination of the AMT, coupled with mandatory spending reforms, including entitlement reforms. The goal should be a balanced budget within 5-10 years, firm, with an appropriate sliding debt limit — increased tax revenues from the new tax system being offset by sharply reduced compliance costs, and linked to firm spending cuts.

    If Obama demagogues on the tax issue, and refuses the deal, they should let the fiscal cliff happen, and refuse to raise the debt limit until he comes to the table. At the same time, Republicans need to put up ads explaining their moves to the public, and asking for support, since they know the media will not do so fairly.

  • kerner

    I heard an audio clip from Charles Krauthammer today to the effect that the tax increases on earners over $250,000/year is a side issue that the president is using to distract from runaway spending. So, Norm may be right about Grover being irrelevant. But sg is uber right about spending having to be cut back.

    I suppose that it is time to point out that the State of Wisconsin has done just that. We cut back State government spending through a process that involved a long, bitter struggle with the democrats and the public employee unions. And guess what? Our taxes have not gone up and the government is talking about reducing them. Given that the Republicans are in power, it may actually happen. But the important point is that the way to avoid tax increases is to reduce the cost of government so the pressure to increase revenue goes away.

  • kerner

    I heard an audio clip from Charles Krauthammer today to the effect that the tax increases on earners over $250,000/year is a side issue that the president is using to distract from runaway spending. So, Norm may be right about Grover being irrelevant. But sg is uber right about spending having to be cut back.

    I suppose that it is time to point out that the State of Wisconsin has done just that. We cut back State government spending through a process that involved a long, bitter struggle with the democrats and the public employee unions. And guess what? Our taxes have not gone up and the government is talking about reducing them. Given that the Republicans are in power, it may actually happen. But the important point is that the way to avoid tax increases is to reduce the cost of government so the pressure to increase revenue goes away.

  • DonS

    Kerner @ 36: I believe part of what Krauthammer said is that Obama has no interest in using this “fiscal cliff” issue to resolve the government’s debt problems. Rather, he is using it to “destroy Republicans”. He believes, with the media in his pocket, spouting Democratic talking points endlessly about anecdotal harms caused by the “fiscal cliff”, that he can force Republicans into a deal that violates everything they stand for, and then Democrats can use that as a hammer in future elections.

  • DonS

    Kerner @ 36: I believe part of what Krauthammer said is that Obama has no interest in using this “fiscal cliff” issue to resolve the government’s debt problems. Rather, he is using it to “destroy Republicans”. He believes, with the media in his pocket, spouting Democratic talking points endlessly about anecdotal harms caused by the “fiscal cliff”, that he can force Republicans into a deal that violates everything they stand for, and then Democrats can use that as a hammer in future elections.

  • Klasie Kraalogies

    Jim Hamilton @ 31 – the US is not a bubble in isolation. A serious financial collapse will hurt billions around the world, especially economies in a more fragile state than yours. What you need is responsible action.

    Cincinnatus @ 28 – I thought about that, but it seams that the intensity of the action might be too much of a shock. Action is needed, though. What you actually need is a serious dose of responsibility, all round, from Joe public, to the bankers, to the government. But the bottom line is that the right sort of financial regulatory reform is not going to happen, because some banks control the politicians to the extent where they cannot act contrary to their wishes (yes, McCain Feingold could have fixed this, but it was weakened due to, well stupidity and greed). All you are getting is lots of regulations that do not change anything. I cannot see congress acting like Mulroney, and especially Chretien acted 2 decades ago here in Canada. Not can I see Bernanke listening to Carney (who is now heading over to head the Bank of England). Furthermore, in their insane lust for credit beyond their means, the public is not applying any sense of responsibility themselves.

    But hopefully, I’m too pessimistic. There is economic growth in the US, albeit slightly weak. Maybe cooler heads will prevail. Ideologues do not fall into that category.

  • Klasie Kraalogies

    Jim Hamilton @ 31 – the US is not a bubble in isolation. A serious financial collapse will hurt billions around the world, especially economies in a more fragile state than yours. What you need is responsible action.

    Cincinnatus @ 28 – I thought about that, but it seams that the intensity of the action might be too much of a shock. Action is needed, though. What you actually need is a serious dose of responsibility, all round, from Joe public, to the bankers, to the government. But the bottom line is that the right sort of financial regulatory reform is not going to happen, because some banks control the politicians to the extent where they cannot act contrary to their wishes (yes, McCain Feingold could have fixed this, but it was weakened due to, well stupidity and greed). All you are getting is lots of regulations that do not change anything. I cannot see congress acting like Mulroney, and especially Chretien acted 2 decades ago here in Canada. Not can I see Bernanke listening to Carney (who is now heading over to head the Bank of England). Furthermore, in their insane lust for credit beyond their means, the public is not applying any sense of responsibility themselves.

    But hopefully, I’m too pessimistic. There is economic growth in the US, albeit slightly weak. Maybe cooler heads will prevail. Ideologues do not fall into that category.

  • Klasie Kraalogies
  • Klasie Kraalogies
  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @ 39

    Great idea KK, we can just institute a federal a tax on land. Anyone who can’t pay it will have his land sold to pay the tax. We have 2.3 billion acres and owe $16 trillion. So, that is only $7k per acre.

    A bargain!

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @ 39

    Great idea KK, we can just institute a federal a tax on land. Anyone who can’t pay it will have his land sold to pay the tax. We have 2.3 billion acres and owe $16 trillion. So, that is only $7k per acre.

    A bargain!

  • Klasie Kraalogies

    sg – that is not what I took away from the article, but whatever.

    Then again, it does seem like the answer to “What would Joseph do?”, given his actions during the great famine, as described in Genesis. :)

  • Klasie Kraalogies

    sg – that is not what I took away from the article, but whatever.

    Then again, it does seem like the answer to “What would Joseph do?”, given his actions during the great famine, as described in Genesis. :)

  • Joe

    KK — the fiscal cliff is not “doing nothing” It is a series of automatic spending cuts and automatic tax increases. I am actually of the mind that this might be a better outcome than whatever cockamamie idea Obama and Boehner will come up with to avoid it.

    One benefit of the fiscal cliff is that it requires cuts in the two largest sacred cows – the military and entitlement programs.

  • Joe

    KK — the fiscal cliff is not “doing nothing” It is a series of automatic spending cuts and automatic tax increases. I am actually of the mind that this might be a better outcome than whatever cockamamie idea Obama and Boehner will come up with to avoid it.

    One benefit of the fiscal cliff is that it requires cuts in the two largest sacred cows – the military and entitlement programs.

  • Klasie Kraalogies

    Joe – I’m not saying the fiscal cliff is doing nothing – it is the result of doing nothing. I’m just not convinced that the drastic nature of the cuts all at once is a good idea – maybe an incremental approach would be better.

    Of course, maybe they will just postpone things…

  • Klasie Kraalogies

    Joe – I’m not saying the fiscal cliff is doing nothing – it is the result of doing nothing. I’m just not convinced that the drastic nature of the cuts all at once is a good idea – maybe an incremental approach would be better.

    Of course, maybe they will just postpone things…

  • DonS

    Klasie @ 43: The cuts aren’t drastic — about $100 billion decrease in the rate of increase of federal spending year over year (no actual CUTS at all). The $500 billion in tax increases is where the action is.

  • DonS

    Klasie @ 43: The cuts aren’t drastic — about $100 billion decrease in the rate of increase of federal spending year over year (no actual CUTS at all). The $500 billion in tax increases is where the action is.

  • Cincinnatus

    KK@43:

    I’m sympathetic to your concern–and the concerns of other alarmists. Plunging over the “fiscal cliff” would be economically disruptive. The stock market would likely fall. Popular discontent would likely rise. But such would be the case with any budgetary reform that will be even remotely effective. And anyway, the “results” of the fiscal cliff are clear to anyone who cares: we know what will be cut, how much, and when. That’s more than can be said for–and will induce more economic stability than–whatever last-minute monstrosity Congress cobbles together to avert the “cliff.”

    Second, the fiscal cliff isn’t the “result” of doing nothing. A bipartisan commission explicitly and knowingly crafted this program, wrote the policy, passed the policy. The “fiscal cliff” is the result of legislative compromise and legislative work. Sure, the media will have a collective conniption about “legislative inaction,” “Republican intransigence,” and so on if the fiscal cliff “happens.” But that’s all hype. It’s doing something, and it’s the result of intentional planning. It’s been spun–and will be spun–as a legislative failure, but that’s more than a little disingenuous.

    Anyway, what’s a better idea? The fiscal cliff makes modest cuts to defense and entitlement programs–the supposed untouchables that absolutely must be cut for fiscal sanity to be achieved. What would you cut and how would you cut it instead?

  • Cincinnatus

    KK@43:

    I’m sympathetic to your concern–and the concerns of other alarmists. Plunging over the “fiscal cliff” would be economically disruptive. The stock market would likely fall. Popular discontent would likely rise. But such would be the case with any budgetary reform that will be even remotely effective. And anyway, the “results” of the fiscal cliff are clear to anyone who cares: we know what will be cut, how much, and when. That’s more than can be said for–and will induce more economic stability than–whatever last-minute monstrosity Congress cobbles together to avert the “cliff.”

    Second, the fiscal cliff isn’t the “result” of doing nothing. A bipartisan commission explicitly and knowingly crafted this program, wrote the policy, passed the policy. The “fiscal cliff” is the result of legislative compromise and legislative work. Sure, the media will have a collective conniption about “legislative inaction,” “Republican intransigence,” and so on if the fiscal cliff “happens.” But that’s all hype. It’s doing something, and it’s the result of intentional planning. It’s been spun–and will be spun–as a legislative failure, but that’s more than a little disingenuous.

    Anyway, what’s a better idea? The fiscal cliff makes modest cuts to defense and entitlement programs–the supposed untouchables that absolutely must be cut for fiscal sanity to be achieved. What would you cut and how would you cut it instead?

  • Klasie Kraalogies

    Cincinnatus – not being an expert, I’m not sure, but I would possibly have implemented the “fiscal cliff” over a couple of increments.

    My concern is not the aim, but the disruption in fragile economic markets. Yes, a lot of it is based on emotion, but that is just it: The reality is that markets largely operate on emotion (confidence), and to pretend otherwise doesn’t change it. The markets, ESPECIALLY in times of great fragility, are like an aggravated cobra – it is best not to make any sudden moves.

  • Klasie Kraalogies

    Cincinnatus – not being an expert, I’m not sure, but I would possibly have implemented the “fiscal cliff” over a couple of increments.

    My concern is not the aim, but the disruption in fragile economic markets. Yes, a lot of it is based on emotion, but that is just it: The reality is that markets largely operate on emotion (confidence), and to pretend otherwise doesn’t change it. The markets, ESPECIALLY in times of great fragility, are like an aggravated cobra – it is best not to make any sudden moves.

  • Klasie Kraalogies

    Yes, and I know the “fiscal cliff” is not a new thing – it has been looming. But the uncertainty connected to it, and the expectation that a more gradual cut would happen, makes inaction leading up to it the equivalent of a “sudden move”.

  • Klasie Kraalogies

    Yes, and I know the “fiscal cliff” is not a new thing – it has been looming. But the uncertainty connected to it, and the expectation that a more gradual cut would happen, makes inaction leading up to it the equivalent of a “sudden move”.

  • Klasie Kraalogies

    Maybe the Media is just overplaying it. But their overplaying it increases uncertainty and panic.

    So the other option is just to shut down all economic commentary by “pundits”…. ;)

  • Klasie Kraalogies

    Maybe the Media is just overplaying it. But their overplaying it increases uncertainty and panic.

    So the other option is just to shut down all economic commentary by “pundits”…. ;)

  • Cincinnatus

    KK,

    Aside from a momentary tremor in the markets that would last for a few days after plunging over the cliff, I’m not worried. The cuts included in the fiscal cliff–which, in case I haven’t been clear yet, is unaptly named–are so modest that they aren’t going to disrupt the economy in any systemic way. Really, I promise.

  • Cincinnatus

    KK,

    Aside from a momentary tremor in the markets that would last for a few days after plunging over the cliff, I’m not worried. The cuts included in the fiscal cliff–which, in case I haven’t been clear yet, is unaptly named–are so modest that they aren’t going to disrupt the economy in any systemic way. Really, I promise.

  • Klasie Kraalogies

    Cincinnatus – predicting short term market behavior is a brave step. My point is, if there weren’t a 101 serious crises going on, I would be less worried. What I am worried is the possibility that market tremors would cause just enough panic to make a single domino fall, somewhere. With the current fragility, the rest of the dominoes are not that well anchored, and some others could fall as a result.

    Again, this worry is based on the reaction of market sentiment, NOT on structural concerns.

    That is the pessimistic view. Yours is the optimistic one (since when have become an optimist? ;) ). I sincerely hope you are right. I’m just not completely convinced.

  • Klasie Kraalogies

    Cincinnatus – predicting short term market behavior is a brave step. My point is, if there weren’t a 101 serious crises going on, I would be less worried. What I am worried is the possibility that market tremors would cause just enough panic to make a single domino fall, somewhere. With the current fragility, the rest of the dominoes are not that well anchored, and some others could fall as a result.

    Again, this worry is based on the reaction of market sentiment, NOT on structural concerns.

    That is the pessimistic view. Yours is the optimistic one (since when have become an optimist? ;) ). I sincerely hope you are right. I’m just not completely convinced.

  • Cincinnatus

    KK,

    I’m not so much being optimistic as skeptical. I can’t really see how the “fiscal cliff” would be more destabilizing to the market than whatever Congress would decide on its own.

    Which is more likely to collapse the economic in accordance with your predictions? The entirely known variables of the “fiscal cliff”–again, I can’t stress enough how misleading this nomenclature is–or the unknown variables of a new congressional deal, which is entirely likely to be less effective than the automatic cuts? Look, the stock market is going to respond badly to any tax increase, whether said increase is “automatic” or brokered later.

    In other words, I’m not suggesting that everything will be sunshine and roses when the cuts kick in, only that I don’t see how they’re worse than the alternatives (which…don’t actually exist right now).

  • Cincinnatus

    KK,

    I’m not so much being optimistic as skeptical. I can’t really see how the “fiscal cliff” would be more destabilizing to the market than whatever Congress would decide on its own.

    Which is more likely to collapse the economic in accordance with your predictions? The entirely known variables of the “fiscal cliff”–again, I can’t stress enough how misleading this nomenclature is–or the unknown variables of a new congressional deal, which is entirely likely to be less effective than the automatic cuts? Look, the stock market is going to respond badly to any tax increase, whether said increase is “automatic” or brokered later.

    In other words, I’m not suggesting that everything will be sunshine and roses when the cuts kick in, only that I don’t see how they’re worse than the alternatives (which…don’t actually exist right now).

  • Klasie Kraalogies

    Cincinnatus, yes, it actually is a fiscal slope – but as I keep on saying, in these matters, popular perception is often more influential than structural reality.

    Which will fall? Lets consider some possibilities.

    Any financial crisis could push the Greek question over the brink, pushing Europe into a deeper recession, which affects commodity prices, which affects Brazil, Australia, Canada and some others. Plus, if the US$ rises, because in times of instability, people either buy US$ or gold,US exports will drop, cutting short the current slow recovery, and pushing a lot of countries back into recession, including some that only flirted with a recession last time (like Canada). Plus, if Greece finally falls, the pressure on Spain becomes huge, and the affect on the European economy as a whole becomes really bad, to the point of pushing even the well-managed ones into recession (like Germany). This further increases political instability, and the far-right wing parties in places like Hungary (referring top Jobbik) finally comes into full power, introducing a political crisis of far-reaching proportions. This of course leaves the Middle East free to continue insane riots, civil wars and missile-lobbing, thus fueling the possibility of full-scale regional conflict, while the West grapples with sever economic problems. Fragile political situations, like minority and coalition governments start falling, and impasse leads to worsening economic conditions, as no one has the power or will to act on economic matters……

    That, of course, is close to worst-case scenario. But it is not improbable. When confidence is razor thin, the proverbial butterfly wings can cause a hurricane….

  • Klasie Kraalogies

    Cincinnatus, yes, it actually is a fiscal slope – but as I keep on saying, in these matters, popular perception is often more influential than structural reality.

    Which will fall? Lets consider some possibilities.

    Any financial crisis could push the Greek question over the brink, pushing Europe into a deeper recession, which affects commodity prices, which affects Brazil, Australia, Canada and some others. Plus, if the US$ rises, because in times of instability, people either buy US$ or gold,US exports will drop, cutting short the current slow recovery, and pushing a lot of countries back into recession, including some that only flirted with a recession last time (like Canada). Plus, if Greece finally falls, the pressure on Spain becomes huge, and the affect on the European economy as a whole becomes really bad, to the point of pushing even the well-managed ones into recession (like Germany). This further increases political instability, and the far-right wing parties in places like Hungary (referring top Jobbik) finally comes into full power, introducing a political crisis of far-reaching proportions. This of course leaves the Middle East free to continue insane riots, civil wars and missile-lobbing, thus fueling the possibility of full-scale regional conflict, while the West grapples with sever economic problems. Fragile political situations, like minority and coalition governments start falling, and impasse leads to worsening economic conditions, as no one has the power or will to act on economic matters……

    That, of course, is close to worst-case scenario. But it is not improbable. When confidence is razor thin, the proverbial butterfly wings can cause a hurricane….

  • Jim Hamilton

    KK @38

    “The US is not a bubble in isolation. A serious financial collapse will hurt billions around the world, especially economies in a more fragile state than yours. What you need is responsible action.”

    Well, I’m not gonna hold my breath waiting for “responsible action” from the jackasses in DC. Or the jackasses in the EU or any other government in the world. No amount of spending, taxation, deficit, or debt makes any impact on the governing class. Maybe a catastrophe would be an actual wake-up call. But, in the end, everybody would blame everybody else and nothing will change.

  • Jim Hamilton

    KK @38

    “The US is not a bubble in isolation. A serious financial collapse will hurt billions around the world, especially economies in a more fragile state than yours. What you need is responsible action.”

    Well, I’m not gonna hold my breath waiting for “responsible action” from the jackasses in DC. Or the jackasses in the EU or any other government in the world. No amount of spending, taxation, deficit, or debt makes any impact on the governing class. Maybe a catastrophe would be an actual wake-up call. But, in the end, everybody would blame everybody else and nothing will change.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    No amount of spending, taxation, deficit, or debt makes any impact on the governing class.

    Unaccountable as always.

    Still, I would say that gov’t policies must affect them at least in relation to the rate of the acceleration of the increase of their personal wealth else they wouldn’t bother affecting it.

    Has anyone heard from Ron Paul or Dennis Kucinich? They usually have interesting perspectives. I don’t think they are liars whatever else they may be.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    No amount of spending, taxation, deficit, or debt makes any impact on the governing class.

    Unaccountable as always.

    Still, I would say that gov’t policies must affect them at least in relation to the rate of the acceleration of the increase of their personal wealth else they wouldn’t bother affecting it.

    Has anyone heard from Ron Paul or Dennis Kucinich? They usually have interesting perspectives. I don’t think they are liars whatever else they may be.

  • http://steadfastlutherans.org/ SAL

    Short-term pain is probably necessary to solve America’s fiscal problems. Other nations need to prepare fend for themselves.

  • http://steadfastlutherans.org/ SAL

    Short-term pain is probably necessary to solve America’s fiscal problems. Other nations need to prepare fend for themselves.

  • Michael B.

    ” Medicare is “off the table”, Social Security is “off the table”, and tax rates must go up on the “wealthy” defined as a two-earner family making $250,000, even in high expense areas like NYC. ”

    I hear this kind of rhetoric all the time, and it just amazes me that a middle-class American could say it. Is there a single person on this forum who is blessed enough to earn over $250,000 a year? Yet most of us probably have parents or grandparents who depend on Medicare. If you were rich, I’d just dismiss your talk as greed and move on. But this kind of politics from the non-rich just baffles me. If I’m a really rich guy, and your parents got turned down for a needed medical procedure so I could have a tax cut, how would you feel? I’ll say one thing, if any of your plans were ever put into action, the liberals would find most of you as instant allies. See you how much you care about gay marriage, abortion, and taxes if the government ever threatens to cut something you need, and you have no other way to get it.

  • Michael B.

    ” Medicare is “off the table”, Social Security is “off the table”, and tax rates must go up on the “wealthy” defined as a two-earner family making $250,000, even in high expense areas like NYC. ”

    I hear this kind of rhetoric all the time, and it just amazes me that a middle-class American could say it. Is there a single person on this forum who is blessed enough to earn over $250,000 a year? Yet most of us probably have parents or grandparents who depend on Medicare. If you were rich, I’d just dismiss your talk as greed and move on. But this kind of politics from the non-rich just baffles me. If I’m a really rich guy, and your parents got turned down for a needed medical procedure so I could have a tax cut, how would you feel? I’ll say one thing, if any of your plans were ever put into action, the liberals would find most of you as instant allies. See you how much you care about gay marriage, abortion, and taxes if the government ever threatens to cut something you need, and you have no other way to get it.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Michael B, some people are principled. They believe in responsibility. They believe that you get what you pay for and you can’t have stuff you don’t pay for. Maybe you are just to young or isolated to know these people but they really do exist. There really are people who do not believe they are entitled to anything. They aren’t rich and they don’t want handouts.

    Consider that all this time since the Supreme court ruled in 1937 that Social Security is a plain old tax and the program can be eliminated at any time by a simple majority in Congress. It is unconstitutional for it to be an insurance program. No one is legally entitled to anything ever from Social Security or Medicare no matter how much they paid in. Got that? Legally that is the case. Now, the Congress passed laws and a created the Social Security Administration and they have charts and tables to tell how much you get, but it is all just plain tax and spend legislation and can be repealed tomorrow. It is not a contract, but because Americans are so dad gone averse to getting something for nothing they will not tolerate being told that is nothing more than a regularly revised legislated free handout. They demand to be told that they are entitled because they paid for it. It is not true and never was, but they cannot psychologically handle being told that their fellow citizens are just plain choosing to give it to them.

    It is nothing more that welfare from poorer younger citizens to richer older citizens. Pure and simple that is what it is. The poorer folks are being taxed to give free stuff to retired people who have far more assets then they do. Remember, this is the payroll tax and the lowest earning people are paying on the first dollar earned. Those dollars are being transferred to people who had all their lives to plan for themselves. So, yes there are people who aren’t rich who look at this and see it for what it is.

    Here is an article that may help you appreciate, if not understand, another perspective:
    http://www.guardian.co.uk/commentisfree/cifamerica/2012/may/25/poor-white-voters-reject-democrats

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    Michael B, some people are principled. They believe in responsibility. They believe that you get what you pay for and you can’t have stuff you don’t pay for. Maybe you are just to young or isolated to know these people but they really do exist. There really are people who do not believe they are entitled to anything. They aren’t rich and they don’t want handouts.

    Consider that all this time since the Supreme court ruled in 1937 that Social Security is a plain old tax and the program can be eliminated at any time by a simple majority in Congress. It is unconstitutional for it to be an insurance program. No one is legally entitled to anything ever from Social Security or Medicare no matter how much they paid in. Got that? Legally that is the case. Now, the Congress passed laws and a created the Social Security Administration and they have charts and tables to tell how much you get, but it is all just plain tax and spend legislation and can be repealed tomorrow. It is not a contract, but because Americans are so dad gone averse to getting something for nothing they will not tolerate being told that is nothing more than a regularly revised legislated free handout. They demand to be told that they are entitled because they paid for it. It is not true and never was, but they cannot psychologically handle being told that their fellow citizens are just plain choosing to give it to them.

    It is nothing more that welfare from poorer younger citizens to richer older citizens. Pure and simple that is what it is. The poorer folks are being taxed to give free stuff to retired people who have far more assets then they do. Remember, this is the payroll tax and the lowest earning people are paying on the first dollar earned. Those dollars are being transferred to people who had all their lives to plan for themselves. So, yes there are people who aren’t rich who look at this and see it for what it is.

    Here is an article that may help you appreciate, if not understand, another perspective:
    http://www.guardian.co.uk/commentisfree/cifamerica/2012/may/25/poor-white-voters-reject-democrats

  • Jim Hamilton

    Micael B. @56

    “If you were rich, I’d just dismiss your talk as greed and move on. But this kind of politics from the non-rich just baffles me.”

    I’m “non-rich.” I don’t want the government to take the money of those who earn high incomes. It’s not greedy for people to want to keep what they earn. Stop looking to the federal government to solve all your problems. People should rely on themselves, their families, and their churches.

  • Jim Hamilton

    Micael B. @56

    “If you were rich, I’d just dismiss your talk as greed and move on. But this kind of politics from the non-rich just baffles me.”

    I’m “non-rich.” I don’t want the government to take the money of those who earn high incomes. It’s not greedy for people to want to keep what they earn. Stop looking to the federal government to solve all your problems. People should rely on themselves, their families, and their churches.

  • dust

    what’s to stop the middle class from voting to confiscate much, much more of wealthy peoples property…via various taxes? that sounds like a tyranny of the majority to me?

    http://www.amazon.com/Tyranny-Majority-Fundamental-Representative-Democracy/dp/B005OLA3RK/ref=sr_1_1?ie=UTF8&qid=1354209787&sr=8-1&keywords=tyranny+of+the+majority

    does that seem fair to you Michael B? is that what the US is all about nowadays? what do you think would be the end result?

    let me guess…some kind of utopia where all the children are above average, etc?

    as per rich folks on this blog, well we like to think we are pretty wealthy….but we just don’t have much money :)

    cheers!

  • dust

    what’s to stop the middle class from voting to confiscate much, much more of wealthy peoples property…via various taxes? that sounds like a tyranny of the majority to me?

    http://www.amazon.com/Tyranny-Majority-Fundamental-Representative-Democracy/dp/B005OLA3RK/ref=sr_1_1?ie=UTF8&qid=1354209787&sr=8-1&keywords=tyranny+of+the+majority

    does that seem fair to you Michael B? is that what the US is all about nowadays? what do you think would be the end result?

    let me guess…some kind of utopia where all the children are above average, etc?

    as per rich folks on this blog, well we like to think we are pretty wealthy….but we just don’t have much money :)

    cheers!

  • Cincinnatus

    Michael B.,

    You’re missing the point. The “$250,000″ trope is misleading. Small businesses usually file under personal income tax rates. For example, the modest meat market in my neighborhood has an annual income of over $250,000, but the owner definitely pockets less than 20% of that figure.

    When progressives spout these numbers, they try to paint fiscally conservative Republicans as either in the pocket of the wealthy (ok, that’s probably true) or naive irrationalists voting against their own interests. In fact, that’s what you’re doing. But just maybe some conservatives recognize that raising taxes on those making more than $250,000 isn’t just a tax on the amorphous “wealthy,” but on the working-class gent who struggles to keep his meat market open.

    I’m not saying that we ought not raise taxes. But we need to shift the rhetoric and call it what it is: small businesses will suffer. Real people will struggle. If that’s what it takes, then so be it. But let’s stop pretending that such a tax increase will only effect Wall Street elites who won’t miss their money.

  • Cincinnatus

    Michael B.,

    You’re missing the point. The “$250,000″ trope is misleading. Small businesses usually file under personal income tax rates. For example, the modest meat market in my neighborhood has an annual income of over $250,000, but the owner definitely pockets less than 20% of that figure.

    When progressives spout these numbers, they try to paint fiscally conservative Republicans as either in the pocket of the wealthy (ok, that’s probably true) or naive irrationalists voting against their own interests. In fact, that’s what you’re doing. But just maybe some conservatives recognize that raising taxes on those making more than $250,000 isn’t just a tax on the amorphous “wealthy,” but on the working-class gent who struggles to keep his meat market open.

    I’m not saying that we ought not raise taxes. But we need to shift the rhetoric and call it what it is: small businesses will suffer. Real people will struggle. If that’s what it takes, then so be it. But let’s stop pretending that such a tax increase will only effect Wall Street elites who won’t miss their money.

  • helen

    One thing the government could stop doing is bailing out multi multi billionaires at the expense of the rest of us.
    If the big bankers on Wall Street were quite sure that their future depended on them, we might see a more responsible way of doing business. [A few more Madoffs in jail would be instructive, too.]

  • helen

    One thing the government could stop doing is bailing out multi multi billionaires at the expense of the rest of us.
    If the big bankers on Wall Street were quite sure that their future depended on them, we might see a more responsible way of doing business. [A few more Madoffs in jail would be instructive, too.]

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @ 61 Amen

    Do you remember the day that they announced the bailout ideas and there were all these nervously smiling Democrats and Republicans all standing together united in solidarity with bankers against the American people?

    It was the creepiest things I had ever seen.

    Do you remember the visibly shaken Hank Paulsen stuttering and stammering as he could hardly speak the words regarding the bailouts? Apparently he actually realized the gravity of what he was saying and was terrified the audience might also.

    Incredibly the near comatose American public distracted in their folly didn’t even get it.

  • http://www.biblegateway.com/versions/Contemporary-English-Version-CEV-Bible/ sg

    @ 61 Amen

    Do you remember the day that they announced the bailout ideas and there were all these nervously smiling Democrats and Republicans all standing together united in solidarity with bankers against the American people?

    It was the creepiest things I had ever seen.

    Do you remember the visibly shaken Hank Paulsen stuttering and stammering as he could hardly speak the words regarding the bailouts? Apparently he actually realized the gravity of what he was saying and was terrified the audience might also.

    Incredibly the near comatose American public distracted in their folly didn’t even get it.

  • WebMonk

    Michael B, I don’t make over $250K, but my parents did at one point. They had a small business, earned between of $200K and $300K, pocketed between $10K and $40K profit per year, weren’t giving themselves any retirement savings, and didn’t have any insurance, period. They are not on Medicare or Medicaid.

    The proposed tax would have certainly destroyed that business.

    I’m not saying my parents were representative of the average person who makes $250,000 per year, but claiming that a tax on people making $250,000+ per year is only a tax on people wealthy enough that they won’t be hurt by it, is nonsense.

    For people who are employees, making $250K per year probably qualifies them as “rich”, and they wouldn’t be much affected by the tax (relatively speaking). For small business owners, though, $250K per year is a LONG ways from “rich”, and the tax could very well force them to close the business, laying people off.

    If it were a tax on people who’s NET income/profit for the year was over $250K, you might have a leg to stand on with that claim, but that’s not what the proposed tax is.

    I sort of agree with Cin @60 here (it happens every once in a while). If we need to increase taxes, and we decide on the $250K income point as where the tax should kick in, then that’s fine, but let’s not lie to ourselves by saying this is just a tax on the “rich” and won’t hurt “the poor” or “middle class”.

  • WebMonk

    Michael B, I don’t make over $250K, but my parents did at one point. They had a small business, earned between of $200K and $300K, pocketed between $10K and $40K profit per year, weren’t giving themselves any retirement savings, and didn’t have any insurance, period. They are not on Medicare or Medicaid.

    The proposed tax would have certainly destroyed that business.

    I’m not saying my parents were representative of the average person who makes $250,000 per year, but claiming that a tax on people making $250,000+ per year is only a tax on people wealthy enough that they won’t be hurt by it, is nonsense.

    For people who are employees, making $250K per year probably qualifies them as “rich”, and they wouldn’t be much affected by the tax (relatively speaking). For small business owners, though, $250K per year is a LONG ways from “rich”, and the tax could very well force them to close the business, laying people off.

    If it were a tax on people who’s NET income/profit for the year was over $250K, you might have a leg to stand on with that claim, but that’s not what the proposed tax is.

    I sort of agree with Cin @60 here (it happens every once in a while). If we need to increase taxes, and we decide on the $250K income point as where the tax should kick in, then that’s fine, but let’s not lie to ourselves by saying this is just a tax on the “rich” and won’t hurt “the poor” or “middle class”.

  • Klasie Kraalogies

    Webmonk – $250 000 on gross is a pretty stringent tax, I agree. For the small business owner, tax on net (obviously inclusive of salary) is better.

    This would of course mean that people would re-invest / expand business / pay higher salaries to keep net under 250K – but that is a positive economic event too, which would benefit the government.

  • Klasie Kraalogies

    Webmonk – $250 000 on gross is a pretty stringent tax, I agree. For the small business owner, tax on net (obviously inclusive of salary) is better.

    This would of course mean that people would re-invest / expand business / pay higher salaries to keep net under 250K – but that is a positive economic event too, which would benefit the government.

  • Michael B.

    @WebMonk

    “I don’t make over $250K, but my parents did at one point. They had a small business, earned between of $200K and $300K, pocketed between $10K and $40K profit per year,”

    So you’re saying they have a lot of legitimate business expenses they can’t deduct?

  • Michael B.

    @WebMonk

    “I don’t make over $250K, but my parents did at one point. They had a small business, earned between of $200K and $300K, pocketed between $10K and $40K profit per year,”

    So you’re saying they have a lot of legitimate business expenses they can’t deduct?

  • kerner

    WebMonk:

    “If it were a tax on people who’s NET income/profit for the year was over $250K, you might have a leg to stand on with that claim, but that’s not what the proposed tax is.”

    Actually, I think the proposed tax might well be a tax on those whose personal adjusted gross income is over $250K. Which is not your parents situation. I might be wrong and will stand corrected if I am.

    Michael B: I net less than $250K myself, but I still oppose these tax increases. First because they won’t do anything to solve the problem. I read somewhere that the additional revenue would only run the government for a matter of days or something. Again, if you can show me how I’m wrong about that, I’ll stand corrected.

    But a more important reason to oppose these taxes has to do with how the “rich” manage their money. They manipulate their investments to minimize their tax obligations. If these kinds of taxes inhibit investment in job creating enterprizes, the “rich will simply choose to not to invest in job creation. They will find a way to make money some other way that doesn’t cost them so much in tax obligations. So, ironically, we might be hurting middle class people by pushing rich people away from job creation.

    Also important is the 9th and 10th commandment prohitition against coveting. If taxing the rich does not solve the problem, trying to take their money away for no reason is doesn’t seem like loving my neighbor to me.

  • kerner

    WebMonk:

    “If it were a tax on people who’s NET income/profit for the year was over $250K, you might have a leg to stand on with that claim, but that’s not what the proposed tax is.”

    Actually, I think the proposed tax might well be a tax on those whose personal adjusted gross income is over $250K. Which is not your parents situation. I might be wrong and will stand corrected if I am.

    Michael B: I net less than $250K myself, but I still oppose these tax increases. First because they won’t do anything to solve the problem. I read somewhere that the additional revenue would only run the government for a matter of days or something. Again, if you can show me how I’m wrong about that, I’ll stand corrected.

    But a more important reason to oppose these taxes has to do with how the “rich” manage their money. They manipulate their investments to minimize their tax obligations. If these kinds of taxes inhibit investment in job creating enterprizes, the “rich will simply choose to not to invest in job creation. They will find a way to make money some other way that doesn’t cost them so much in tax obligations. So, ironically, we might be hurting middle class people by pushing rich people away from job creation.

    Also important is the 9th and 10th commandment prohitition against coveting. If taxing the rich does not solve the problem, trying to take their money away for no reason is doesn’t seem like loving my neighbor to me.

  • WebMonk

    I’m relatively certain that the tax is on people who’s gross income is over $250,000.

    ACA Section 9015, b.1.2.A.

    a tax equal to 0.5 percent of the self-employment income for such taxable year which is in excess of–

    “(i) in the case of a joint return, $250,000,
    and
    “(ii) in any other case, $200,000.

    I’m not a tax expert by a long shot, so I might be wrong on that, but that sounds like it is the gross income since it doesn’t specifically say net income or after expenses/deductions. Having $300K income with $250K expenses would still have someone getting hit by the tax – not good for small businesses.

    However, I did learn something that mitigates this somewhat – it is only on the portion which is above $250,000. That would lower the impact on people barely making over $250K. If you make $300K jointly, then you only pay the tax on the $50K.

    That does limit the burden until you start getting well above the $250K income mark. I’m still not a fan of it because I think it could be better designed to avoid burdening small businesses, but it’s not as bad as I thought.

  • WebMonk

    I’m relatively certain that the tax is on people who’s gross income is over $250,000.

    ACA Section 9015, b.1.2.A.

    a tax equal to 0.5 percent of the self-employment income for such taxable year which is in excess of–

    “(i) in the case of a joint return, $250,000,
    and
    “(ii) in any other case, $200,000.

    I’m not a tax expert by a long shot, so I might be wrong on that, but that sounds like it is the gross income since it doesn’t specifically say net income or after expenses/deductions. Having $300K income with $250K expenses would still have someone getting hit by the tax – not good for small businesses.

    However, I did learn something that mitigates this somewhat – it is only on the portion which is above $250,000. That would lower the impact on people barely making over $250K. If you make $300K jointly, then you only pay the tax on the $50K.

    That does limit the burden until you start getting well above the $250K income mark. I’m still not a fan of it because I think it could be better designed to avoid burdening small businesses, but it’s not as bad as I thought.

  • kerner

    Yeah, but self employment “income” is what comes out at the bottom of your schedule C, isn’t it? line 31 on schedule C is “net profit”. Then you take that number and put it on Form 1040 line 12 (business income).,

    What you are talking about is “gross sales”, and I know of no income tax that is based on gross sales. Maybe this is the first, but if this is an income tax on gorss sales, I think it would really be something new.

    Now a sales tax is based on gross sales, but I thought this is just letting the old Bush tax cuts expire for people making over 250k in income. Maybe we should contact our congressmen or somebody who really knows the answer. Because we shouldn’t be speaking from ignorance (and that includes me).

    One thing does work in old Michael B’s favor, however. If the rich supported Obama at the level that Bill Christol says they did, I don’t know why conservatives think they have to spend all this political capital defending people who don’t care. Except I think the real reason to oppose this comes back to the fact that it will hurt the guy who is new to making money and won’t know how to manipulate the tax code so as to not pay taxes. Which is what the real fat cats are going to do anyway. This “fare share” nonsense is not going to raise significant revenue, so I don’t see what the attraction to Michael B and his fellow travelers is. Unless it is that it makes them feel better, which is what liberalism is all about anyway. Their policies never really help anybody improve their lives; but they get to feel compassionate for having tried.

  • kerner

    Yeah, but self employment “income” is what comes out at the bottom of your schedule C, isn’t it? line 31 on schedule C is “net profit”. Then you take that number and put it on Form 1040 line 12 (business income).,

    What you are talking about is “gross sales”, and I know of no income tax that is based on gross sales. Maybe this is the first, but if this is an income tax on gorss sales, I think it would really be something new.

    Now a sales tax is based on gross sales, but I thought this is just letting the old Bush tax cuts expire for people making over 250k in income. Maybe we should contact our congressmen or somebody who really knows the answer. Because we shouldn’t be speaking from ignorance (and that includes me).

    One thing does work in old Michael B’s favor, however. If the rich supported Obama at the level that Bill Christol says they did, I don’t know why conservatives think they have to spend all this political capital defending people who don’t care. Except I think the real reason to oppose this comes back to the fact that it will hurt the guy who is new to making money and won’t know how to manipulate the tax code so as to not pay taxes. Which is what the real fat cats are going to do anyway. This “fare share” nonsense is not going to raise significant revenue, so I don’t see what the attraction to Michael B and his fellow travelers is. Unless it is that it makes them feel better, which is what liberalism is all about anyway. Their policies never really help anybody improve their lives; but they get to feel compassionate for having tried.

  • kerner

    You do, however, notice the “marriage penalty” associated with this, don’t you. 2 single people can make a combined total of $400k before it kicks in, but a married couple filing jointly only has to make $250k. I love to see family values at work in government.

  • kerner

    You do, however, notice the “marriage penalty” associated with this, don’t you. 2 single people can make a combined total of $400k before it kicks in, but a married couple filing jointly only has to make $250k. I love to see family values at work in government.

  • kerner

    oops…I think I meant Bill Kristol…oh well.

  • kerner

    oops…I think I meant Bill Kristol…oh well.


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