Fiscal Cliff “Averted”

The last charge of the 112 Congress has taken place.  With just hours before the session was set to close, the congress passed the bill that will now go to Obama’s desk for signature.  Only in my most vindictive moments did I want us to go over the cliff.  I wanted the average person who voted for the current President to face the economic damage first hand.  If nothing else, the prospect of facing an additional $2,500 in taxes with the possibility of the AMT hitting them, they  may have learned what happens when a tax happy spend happy administration gets in power.

As it is, we have very little to be happy about.  The first, if not only, is the fact that the Bush Tax Cuts are now permanent for everyone earning less then $450,000.  About time!  Although now that they are permanent, watch the left begin calling them the Obama Tax Cuts – as if.

The other positive is that the AMT’s annual correction is also permanent.  No more posturing on that one.

But there is a TON to hate.  Taxes going up for anyone in this economy is only going to do more harm than good.  And those taxes are on business and investors.  Not to mention investment itself.

And the worst part?  There wasn’t ANY spending cuts of meaning.  Rather we have that battle in two months.  Oh yeah, I forgot the third thing – no debt ceiling limit rise.

All that means is that we get to go through this all over again in a few short months.

9 responses to “Fiscal Cliff “Averted”

  1. They are the Obama tax cuts — the Bush cuts disappeared when we went over the cliff on January 1. And you know that tax cuts harm the economy less than spending cuts (in terms of economic stimulus). That’s what is so absurd about the argument from both sides – spending cuts and tax increases hurt the economy! Neither is good for the economy. But both are necessary to get the budget in order. You need to balance a budget you increase revenue and cut spending. The right seems to think spending cuts do no harm but tax cuts harm the economy. The left thinks the opposite. Both harm the economy, but both are necessary.

    • They are the Obama tax cuts

      Amazing.

      And you know that tax cuts harm the economy less than spending cuts (in terms of economic stimulus).

      I think you meant “tax hikes”. But no, I don’t agree with you on that. However, here is what I will agree with you on:

      When we calculate the GDP we do it this way:

      GDP = private consumption+investment+government spending+(exports-imports)

      So, when looking at GDP, yes, spending cuts “hurt worse”. However, when we look at the growth of the private sector that is you and me, we ALL know that the lower taxes are and the lower spending is the better off that private sector is.

      When the government spends, they first must take, borrow or print. There is no other way around it. And when that happens, the money is spent worse than it might otherwise have been in the hands of people spending it on their own self interests.

      You need to balance a budget you increase revenue and cut spending.

      This I agree with you on as well. However, what we all forget is that the government routinely takes in more revenue year over year. And this “pay raise” is all accomplished while leaving the tax rates alone.

      The right seems to think spending cuts do no harm but tax cuts harm the economy.

      You have it half right You are right in that the right thinks that spending cuts HELP the economy. But you are wrong here; the right also thinks that tax cuts HELP the economy.

      • When the GOP let us go over the cliff, tax rates rose. Obama’s plan cut them. There were no more Bush tax cuts at that point. It’s technical, but true.

        I don’t buy your argument about the private sector. There is no way spending cuts help the private sector. Overall debt will hurt, but if you cut the budget it will hurt the private sector. And people spending their own money is not better for the economy – they often pay down debt or buy foreign goods. Directed spending is more effective at stimulating the private sector.

        • It’s technical, but true.

          Amazing.

          There is no way spending cuts help the private sector.

          Less government spending helps the private economy. More government spending hurts it.

          And people spending their own money is not better for the economy

          It is always better for the economy.

          they often pay down debt

          The horror! Greedy bastards!

          or buy foreign goods.

          Yes. Cheaper goods provide a better value for consumers. THAT is GREAT for the economy.

  2. So, I hear a common refrain from republicans and conservatives that Obama’s and the Democrats didn’t get a mandate in November and that they therefore shouldn’t have been pushing to raise taxes on the wealthy. If the party that won didn’t get a mandate to raise taxes from their November victory, where on earth did the party that lost get a mandate from to force cuts to social security/medicare?

    • or, with slightly fewer typos: Many republicans and conservatives argue that Obama and the Democrats didn’t get a mandate in November and that they therefore shouldn’t have pushed to raise taxes on the wealthy. If the party that won (with an argument that we need to raise taxes on the wealthy) didn’t get a mandate to raise taxes on the wealthy, where on earth did the party that lost get its mandate to force cuts to social security/medicare from?

      • If the party that won (with an argument that we need to raise taxes on the wealthy) didn’t get a mandate to raise taxes on the wealthy, where on earth did the party that lost get its mandate to force cuts to social security/medicare from?

        So, right, Obama won. And so did more republican House members than Democrats. So, if a mandate is all encompassing for the President, can it be argued even more so for the House in total?

        Anyway, mandate or no, you are right, Obama is right to lean on the wealthy for more revenue. He’s not right from a policy perspective, no one is making the argument that the revenue generated from this tax hike will make any significant difference to our dilemma. But, Obama has been consistent in this class warfare stance.

  3. Pino,

    I totally agree with you . ” Amazing ”

    If truth and reality were clothing , there are very few of us who still say our Emperor has none . The President never had any intention of cutting the deficit . He never had any intention of putting people back to work . He must be a political genius that he figured out he could do anything he wanted and still get reelected .

    How many college graduates cannot find real work ? How many young couples cannot start a family because they cannot find good enough jobs to start households ? That is the legacy of our Kommander in Chief . There is a whole generation of young adults who have put their lives on hold because of this Clown .

    Down the road they may be the generation still alive when the Country goes bankrupt because of him .

    • I totally agree with you . ” Amazing ”

      Watch the press.

      The President never had any intention of cutting the deficit . He never had any intention of putting people back to work .

      Correct.

      He must be a political genius that he figured out he could do anything he wanted and still get reelected .

      Nope.

      Hand out free stuff and assassinate the character of your rival months before he wins the primary.

Leave a Reply

Your email address will not be published. Required fields are marked *