Obama’s asking for it; maybe the GOP should give it to him
It appears more and more likely that Washington’s new favorite drama, the fiscal cliff, will run as long as possible.
Passing new legislation before Christmas to avoid the cliff — the doomsday nickname given to the combination of across-the-board spending cuts set during last year’s debt-ceiling negotiations and the total expiration of income-tax rates that have prevailed since since 2003 — now seems unlikely. House Majority Leader Eric Cantor on Wednesday said lawmakers can expect to be in Washington during December’s final days.
The fatal conceit in this debate is that the economy will somehow be well-served, or at least survive, if it takes only a half-dose of what Democrats consider poison (spending cuts) and a half-dose of what the GOP deems deadly (tax increases).
If either party is correct, we are in for a rough 2013 at the very least. If both parties are correct, we could be heading for another recession. The irony is that we’re trying to avoid the fiscal cliff in order to prevent … a recession.
Only President Obama has proposed a pure version of his preferred course: A $1.6 trillion tax hike on upper-income earners over the next 10 years, recently reduced to $1.4 trillion, with no guarantee of net spending cuts. The House GOP’s opening salvo had much more of the “balance” Obama insists on.
Many observers have dismissed the president’s proposal as a mere negotiating stance. Perhaps they’re right. But one presumes he wouldn’t have made a proposal he wasn’t ready to accept.
That is, one presumes Obama really believes taking an extra $140 billion out of the economy each of the next 10 years — remember, he says the money is for deficit reduction, not to fund new government spending — would not be harmful to businesses, workers or the unemployed.
Members of Congress are supposed to do what they believe to be in the best interests of the country and their constituents. But if House Republicans cannot persuade Obama to agree to meaningful entitlement reforms, which along with more rapid economic growth are the only way to bring our fiscal house in order, they should consider giving Obama what he wants.
This is not a decision to be taken lightly. But Republicans might not win this policy argument in the long run if Obama can pin the blame for economic damage on GOP spending cuts, while continuing to demagogue the rich for not paying their “fair share,” without consequences.
And there would be consequences for following his plan. Today, $140 billion equals almost 1 percent of gross domestic product. When the economy is struggling to grow by an annual rate of even 2.5 percent, taking another 1 percent of GDP out of the private sector will not help matters.
But what about the 1990s? Didn’t Bill Clinton raise taxes back then, only to watch the economy boom?
Yes, but there are major differences between then and now. Clinton raised taxes as both the U.S. and world economies were stronger than now. He did it when state taxes were broadly lower than they are now. He did it when oil was closer to $20 a barrel than $90 a barrel. He did it before a record housing boom, not after its bust. He did it at the onset of the IT boom, which doesn’t figure to be replicated anytime soon. And before revenues really grew, he cut the capital-gains tax rate, rather than raising it as Obama desires.
Worse, Obama wants to get most of this $140 billion in part by raising marginal tax rates on “the rich” whether their earnings come from their labor or their investments. This has a significant impact on decision-making. For just one current example, look at the growing number of companies paying their anticipated dividends for 2013 out to shareholders now to beat a potential tax hike.
Some of these companies, Costco for example, are even borrowing money to pull off this switcheroo — committing themselves to pay back billions they only hope to earn as profits in the future. Talk about distorting economic behavior.
Obama says the people voted for these higher taxes. While I believe Obama’s proposal would be very harmful economically, congressional Republicans might find themselves with little choice but to allow his policies to prove him wrong in practice. Obama could hardly blame them for letting him entangle himself with the rope he’s demanding.
– By Kyle Wingfield
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504 comments Add your comment
RetiredSoldier
December 13th, 2012
1:06 pm
redneck-
It takes two to dance and I don’t see Obama shaking a leg either.
Aesop's Fables and other Lib Economic Theories
December 13th, 2012
1:07 pm
I never in my life imagined that anyone could become obsessed with Mitt Romney but I was wrong.
ROMNEY LOST THE ELECTION!!!!
carlosgvv
December 13th, 2012
1:12 pm
Tiberius – 11:27 “I’m not as petty as you liberals”
Real “liberals” are, by definition, not “petty”.
You, on the other hand, give a whole new meaning to the word.
JDW
December 13th, 2012
1:13 pm
Nice try Rafe…the key policies that drove Clinton’s success (PAYGO and taxes) were put into place in 92/93. The IT boom was a result rather than a fortutious occurance. The growth the fueled the 90’s was created by policy and we need to inact the same ones today….no spending unless paid for and taxes at a rate that pay the bills…it is not rocket science but Republicans don’t get it.
Under Reagan/Bush expenses grew about .25% faster than revenues. Under Duhbya they grew 7% faster.
Under Clinton revenue grew faster at a rate of 3.6% and under Obama to date revenue has grown faster at a rate of 2.9%.
Cheesy Grits is gone but not forgotten
December 13th, 2012
1:14 pm
Cheesy, I thought it was Nate Silver? Is it true that you wish you were female, so you could have his baby?
It is Nate Silver.
And no to the second part.
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:15 pm
JDW: The IT boom was a result rather than a fortutious occurance.
———————–
All that’s missing is a logical explanation.
You and your ilk are full of it.
Cheesy Grits is gone but not forgotten
December 13th, 2012
1:15 pm
I never in my life imagined that anyone could become obsessed with Mitt Romney but I was wrong.
ROMNEY LOST THE ELECTION!!!!
Your doing great.
real john
December 13th, 2012
1:20 pm
I’m still waiting on Obama and the Dems too offer their compromise. So far the Repubs have agreed to at least $800 billion in new taxes, but Obama isn’t offering any spending cuts…
Some bipartisan, cheif compromiser we have as President. But you know, its the Republicans that are obstructionists…
Rafe Hollister preparing for an Obamanist America
December 13th, 2012
1:22 pm
More taxes and more regulations drove the economy during Clinton’s regime. Not buying that. Dotcom bubble had nothing to do with either, it was just technology bursting out all over as it does occasionally.
BTW, whatever happened to Paygo, that you obviously think is beneficial. Pelosi screamed “paygo” every time Bush wanted to spend money. Since she ran the house and Hairy ran the Senate the last two years of the Bush regime, why did she not enforcethis provision, and why has no one mentioned paygo since 2009? Hypocrites? I like you think we need to get back to Paygo, but Barry just wants more and more spending and no real cuts.
real john
December 13th, 2012
1:24 pm
So Cheesy if Obama’s policies are working, and one of his policies, was extending the Bush tax cuts, than I guess you would have to give Bush credit..right??
If unemployment is getting better, than I’m still waiting on my liberal friends to explain to me how RAISING taxes on job creators is going to help create jobs and lower unemployment. Maybe one of you can enlighten me.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
1:25 pm
“You weren’t just wrong.
You were off the reservation on another planet way way off.”
As was pointed out, Cheesy, if only 400k votes had switched in just 4 states, my prediction would have been spot-on. The analysis wasn’t that far off based on actual votes. That the Electoral College swung so much one way was. But had a relatively few actual votes in certain areas changed hands, there would be a lot less spiking the ball (which you libs excel at) and a lot more leadership on display (which you libs fail at).
Reality
December 13th, 2012
1:32 pm
@NotYou,
You need to separate the facts. No one is “still blaming Bush” per say. But think of it this way:
You catch a cold from your partner. Day 1 you just don’t feel well. Day 2 you sneeze. Day 3 you have a runny nose and run a slight fever.
Is it really wrong to blame your partner on Day 4 for you feeling bad?
This is the perfect analogy for the “blaming Bush”. We are STILL dealing with the symptoms of the economy that he left. Just as you would be dealing with the symptoms of the cold that your partner left for you.
Get it now?
JDW
December 13th, 2012
1:33 pm
@Rafe…”BTW, whatever happened to Paygo, that you obviously think is beneficial. ”
Duhbya’s first act was to end it. His second to lower taxes. Today we live with the legacy.
Cheesy Grits is gone but not forgotten
December 13th, 2012
1:34 pm
If unemployment is getting better, than I’m still waiting on my liberal friends to explain to me how RAISING taxes on job creators is going to help create jobs and lower unemployment.
Because it will generate revenue and help us get out of debt.
The whole trickle down thing has been proven a total disaster.
Bush cuts taxes in 2003. Where were all the jobs? Why did the economy tank on his watch ?
When people like Mitt Romney pay half the rate the average American does. Hides money in the Cayman Islands and has elevators just for his cars.
Then something is very very wrong.
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:34 pm
If we’re still dealing with the recession that occurred on Bush’s watch, it’s because Obozo so badly mismanaged things as to stunt the recovery.
Obozo: America hating economy killer.
getalife
December 13th, 2012
1:34 pm
Don’t cave Kyle.
Stay the course.
The Dems will have a rubber stamp congress in 14 and then he will get everything he wants like w .
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:35 pm
When people like Mitt Romney pay half the rate the average American does
————–
What rate did Romney pay?
What rate does the average American pay?
You’re full of it.
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:37 pm
Bush cuts taxes in 2003. Where were all the jobs?
——————–
Unemployment was around 5% after Our President Bush cut taxes for all tax payers.
Obozo has kept unemployment between 7.8% – 10%.
Ask Obozo your question about jobs.
Cheesy Grits is gone but not forgotten
December 13th, 2012
1:37 pm
Romney paid 14 percent.
The average American pays double that ( If not more )
It is you my friend who are full of it.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
1:37 pm
“Because it will generate revenue and help us get out of debt.”
Except President Incompetent’s proposals do noting to reduce the debt.
Cheesy Grits is gone but not forgotten
December 13th, 2012
1:38 pm
Unemployment was around 5% after Our President Bush cut taxes for all tax payers.
Wrong.
It was going up like a rocket his last two years and was out of control when he left office.
Try again.
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:39 pm
Long term, the best thing for the country is to go ahead and let the spending cuts happen.
Obozo will never sign off on any further spending cuts–this is it.
JDW
December 13th, 2012
1:39 pm
@Tiberius…could you pick a side of your mouth to use…
Here you write…
“As was pointed out, Cheesy, if only 400k votes had switched in just 4 states, my prediction would have been spot-on. ”
Earlier today, in response to a comment regarding House vote totals, you wrote…
”I was unaware that was how we voted in a Constitutional Republic”
So which is it senility or hypocrisy?
Reality
December 13th, 2012
1:40 pm
@ real john (or whatever other handle you post),
You say, ‘raising taxes on the job creators’? Really? Is that the target group? And, are taxes really being raised?
First, the taxes are NOT being “raised” but rather the tax cuts are being stopped. This is a major point not to over look. The tax rates for the most wealty will simply return to the pre-Bush tax cut era. The tax rates are NOT being “raised”!!!!
Second, the “most wealthy” are not the exact same as the “job creators”. This is a myth created by FOX news and the conservatives. If you really think this, then…
Is Paris Hilton a job creator? She certainly is one of the “most wealthy”, but does she really create jobs? The answer is no.
Is even Ted Turner a job creator? He is one of the most wealthy, but no – he does not create jobs. He has not ‘created jobs’ in a long long time, especially since he sold his TV station.
There are many many other examples, but I do hope that you ‘get it.’
So you can see, the “most wealthy” certainly does NOT equal the “job creators.”
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
1:41 pm
“Why did the economy tank on his watch ?”
The culmination of over 30 years of liberal economic and political policies.
Next?
RetiredSoldier
December 13th, 2012
1:42 pm
Cheesy-
Wrong on so many counts.
1. Raising taxes won’t get us out of debt, it will barely reduce the decicit because of the new spending Obama wants to do.
2. The economy tanked in large measure because of the absurd housing measures pushed by Dodd and Frank. Everyone gets a loan and no you don’t have to provide prrof you can repay it.
3. Romney and the Caymans, I presume that also disqualifies H. Clinton too. Correct?
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:44 pm
Cheesy: Immune to facts.
Unemployment in December of each year:
2002 6.0% (the year prior to the tax cuts)
2003 5.7%
2004 5.4%
2005 4.9%
2006 4.4%
2007 5.0%
2008 7.3%
2009 9.9% (After one year of Obozofailures)
Yeah, that unemployment under Our President Bush was a real bear.
Reality
December 13th, 2012
1:44 pm
@Cheesy Grits….
I think that our mistake is trying to use logic and rational to converse with these idiot conservative republicans. They do not think. They can not. They have been ‘trained’ like little monkeys to repeat what FOX News and talk raido spews.
Reality
December 13th, 2012
1:46 pm
@lil’ Barry,
You cannot accept your own facts and the reality of what happened in those years.
Do you really think that Our President Obama enacted policies so quickly within year one to change unemployment like that? Really?
You don’t think that BushLeague had anything to do with it? Really?
You might be even more dumb than I thought – and that was pretty dumb!
Reality
December 13th, 2012
1:50 pm
@Tiberius….
You are wrong. Under LIBERAL Bill Clinton, the economy was the best we have ever had. Immediately following Clinton was Bush that started our spiral downward that lead us in to the recession. Bush was conservative.
Next?
Pizzaman
December 13th, 2012
1:51 pm
Lil Barry 10:53,
Your wrong!
Love and Kisses,
Pizzaman
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:51 pm
The fact is that Obozo inherited a recovery, made all the wrong moves, and caused unemployment to increase from 7.7% to 10%. The fact is that Obozo increased spending by $700 billion, every year, above where Our President Bush had it. The fact is that Obozo is the only one to ever run or propose trillion dollar deficits, every year. The fact is we’ve never had as many folks living in poverty as we do under Obozo.
I’ll ignore your petty personal attack and allow you to chew on that reality for a bit.
getalife
December 13th, 2012
1:54 pm
Your speaker cut and ran again.
He went home so no deal.
You lose again cons.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
1:55 pm
“So which is it senility or hypocrisy?”
Neither, JDW.
One is analysis (which you do not understand) and one is a statement of fact (which you are incapable of understanding).
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
1:56 pm
No deal is the best deal.
Americans win.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
1:57 pm
“First, the taxes are NOT being “raised” but rather the tax cuts are being stopped.”
Only from the so-called “mind” of a liberal can this statement be uttered.
JDW
December 13th, 2012
1:57 pm
O’ another thing relative to this 400,000 vote fantasy…it’s actually 562,000 votes. Mittens would have had to turn NH, NV, FL, IA, CO and VA. 562,000 votes represents 3% of the vote total in those states…so actually it’s not that close even with spin.
https://docs.google.com/spreadsheet/lv?key=0AjYj9mXElO_QdHpla01oWE1jOFZRbnhJZkZpVFNKeVE&toomany=true
Reality
December 13th, 2012
1:58 pm
@Lil’ Barry,
LOL!!!! It must really just KILL you to KNOW that the President of the United States is again President Obama. I just enjoy reading your post because your total frustration is so clear.
Just think – for generations, all of your children, grandchildren, great grandchildren, and so on will learn that President Obama not only won election, but also re-election serving as President for EIGHT years!!!
LOL!!!!
HDB
December 13th, 2012
1:58 pm
Tiberius – pulling the tail of the left AND right when needed
December 13th, 2012
1:41 pm
“Why did the economy tank on his watch ?”
The culmination of over 30 years of liberal economic and political policies.
Next?”
Actually, Tibbi, Republican policies under Reagan were the precursors to economic failure…..when the deficit QUADRUPLED in Reagan’s first YEAR…while under Carter, the deficits were flat for four years(160B for Reagan, $46B under Carter). The idea of cutting taxes and increasing spending put this nation on the course we now find ourselves!! It would have been worse…but Reagan did RAISE taxes to keep the deficits from really exploding over the 200B mark in his first term…..and remember GHWB also raised taxes!
JDW
December 13th, 2012
1:59 pm
@Tiberuis..”One is analysis (which you do not understand) and one is a statement of fact (which you are incapable of understanding).”
Now I thought we solved that little analysis question earlier or do we need to rehash the accuracy of your analysis?
As for the fact part…check out my 1:57 for the actual facts.
getalife
December 13th, 2012
2:00 pm
The end of our President’s first term is going extremely well.
Our economy is back and growing.
No scandals, no attacks on the homeland, no collapses and no occupations.
Competent and history making President.
You are on the wrong side of history cons.
Your behavior is unacceptable and sets a horrible example for the children.
Unhinged, unpatriotic and unAmerican.
Reality
December 13th, 2012
2:01 pm
@Tiberius –
Huh? This is the absolute truth.
Under President Clinton there was federal tax rates. Can you agree with that?
Under BushLeague, he instituted tax cuts. Can you agree with that?
If you can agree with those first two, then obvious what President Obama proposes for the most wealthy is to return to the tax rates used during the Clinton administration.
That is a net change of zero, isn’t it? If you think not, then you need to learn how to do basic math.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
2:01 pm
“Under LIBERAL Bill Clinton, the economy was the best we have ever had.”
Reality, there are many economies that have generated more sustained and real growth in the history of this nation than the dot-com bubble of Bill Clinton’s economy. In addition, you should really try to get it into your head that Congressional action and Presidential action go hand in hand in determining the success or failure of a Presidency, as well as outside forces that are beyond the control of government action.
I will never credit any one administration or Congress for economic sustainability, as neither group is responsible for the success of an economy, even if they both can kill one.
getalife
December 13th, 2012
2:06 pm
What you should give him is respect .
HDB
December 13th, 2012
2:06 pm
Lil’ Barry Bailout – OBAMAPHONE!!!
December 13th, 2012
1:51 pm
T”he fact is that Obozo inherited a recovery, made all the wrong moves, and caused unemployment to increase from 7.7% to 10%. The fact is that Obozo increased spending by $700 billion, every year, above where Our President Bush had it. The fact is that Obozo is the only one to ever run or propose trillion dollar deficits, every year. The fact is we’ve never had as many folks living in poverty as we do under Obozo.”
Actually, LBB….the economy WASN’T in recovery under Bush……when the economic markets needed the TARP infusion it was October, 2008!! The economy didn’t begin its recovery until the middle of 2009…..and when the stimulus was added in March of 2009, the economy started to turn about 5 months later!!
Unemployment is also a LAGGING indicator…..the effect of political policies aren’t fully known for as long as 36 months…..so if you take your 9.9% unemployment rate in 2009….the policy effect would have started as early as 2006….in the heart of the Bush Years……..
JamVet
December 13th, 2012
2:09 pm
I am not going to debate conservatism…
Of course not Rafe. I’m impressed that you can even spell the word.
It’s all good, you spendaholic neocons killed conservatism. Dead. kaput. Gonzo. And now you’re learning how to deal with your own self-imposed trickle down disasters.
Enjoy your handiwork, “conservatives” LOL.
I’ll make the popcorn…
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
2:09 pm
Reality, please keep up with the English language, OK?
When you CUT tax rates, they go down. They are the new norm.
When you change the rates from where they currently are to a higher rate, it is a tax rate increase.
Nice try at spin, but epic failure.
Lil' Barry Bailout - OBAMAPHONE!!!
December 13th, 2012
2:10 pm
Reality: Just think – for generations, all of your children, grandchildren, great grandchildren, and so on will learn that President Obama not only won election, but also re-election serving as President for EIGHT years!!!
————————–
Wow, just like Our President Bush.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
2:12 pm
HDB, it is clear that you cannot get past simply focusing on tax rates and revenues regarding economic growth or stagnation, nor do you even remotely understand the Reagan Presidency and it’s many nuances.
I’ve tried before, but I am NOT going to explain it to you again, as you are incapable of understanding complex concepts.
Tiberius - pulling the tail of the left AND right when needed
December 13th, 2012
2:14 pm
“As for the lies part…check out my 1:57 for the actual lies.”
Fixed your typos, JDW.
JDW = liar.