"The extension of lower tax rates for the bulk of the nation's taxpayers and the addition of a patch to the Alternative Minimum Tax would add roughly $3.6 trillion to the deficit over the next decade, the CBO said. Other individual, business and energy tax extenders would add another $76 billion. The extension of unemployment benefits would cost roughly $30 billion, and the so-called "doc fix" would tally another $25 billion through fiscal 2022.
"The CBO says the budget agreement will lead to an overall increase in spending of about $330 billion over 10 years."
So yes, the cost of the bill is due to now the Obama tax cuts, but it contains little if any spending cuts. This is not a balances approach to our fiscal problems. It makes them worse. It is a bad deal when you agree to $41 dollars in taxes for every dollar in cuts. And even worse, you are going to lose jobs because many of the so-called rich are small businesses.
You don't have to be "an aggessive tax hiker" to recognize that raising taxes without any real reduction in spending. And it raises a larger question as to how best frame the issue. Right now, most Americans want to have the same level of taxation except for the "rich" who should have their taxes raised. They are in favor of spending cuts and living within our means, but they don't want the entitlement programs touched. Therein, lies the problem.
Mark Steyn, in his America not paying its fair share--You cannot simultaneously enjoy American-sized taxes and European-sized government. One or the other has got to go. puts it very well.
A few months ago, I dined with a (pardon my English) French intellectual who, apropos Mitt Romney's stump-speech warnings that we were on a one-way ticket to Continental-sized dependency, chortled to me, "Americans love Big Government as much as Europeans. The only difference is that Americans refuse to admit it."
My Gallic charmer is on to something. According to the most recent (2009) OECD statistics: Government expenditures per person in France, $18,866.00; in the United States, $19,266.00. That's adjusted for purchasing-power parity, and, yes, no comparison is perfect, but did you ever think the difference between America and the cheese-eating surrender monkeys would come down to quibbling over the fine print? In that sense, the federal debt might be better understood as an American Self-Delusion Index, measuring the ever-widening gap between the national mythology (a republic of limited government and self-reliant citizens) and the reality (a 21st century cradle-to-grave nanny state in which, as the Democrats' Convention boasted, "government is the only thing we do together.").
Generally speaking, functioning societies make good-faith efforts to raise what they spend, subject to fluctuations in economic fortune: Government spending in Australia is 33.1 percent of GDP, and tax revenues are 27.1 percent. Likewise, government spending in Norway is 46.4 percent, and revenues are 41 percent – a shortfall but in the ballpark. Government spending in the United States is 42.2 percent, but revenues are 24 percent – the widest spending/taxing gulf in any major economy.
So all the agonizing over our annual trillion-plus deficits overlooks the obvious solution: Given that we're spending like Norwegians, why don't we just pay Norwegian tax rates?
No danger of that. If (in Milton Himmelfarb's famous formulation) Jews earn like Episcopalians but vote like Puerto Ricans, Americans are taxed like Puerto Ricans but vote like Scandinavians. We already have a more severely redistributive taxation system than Europe, in which the wealthiest 20 percent of Americans pay 70 percent of income tax while the poorest 20 percent shoulder just three-fifths of 1 percent. By comparison, the Norwegian tax burden is relatively equitably distributed. Yet Obama now wishes "the rich" to pay their "fair share" – presumably 80 percent or 90 percent. After all, as Warren Buffett pointed out in The New York Times this week, the Forbes 400 richest Americans have a combined wealth of $1.7 trillion. That sounds like a lot, and once upon a time it was. But today, if you confiscated every penny the Forbes 400 have, it would be enough to cover just over one year's federal deficit. And after that you're back to square one. It's not that "the rich" aren't paying their "fair share," it's that America isn't. A majority of the electorate has voted itself a size of government it's not willing to pay for.
IMO we should have gone over the cliff. Then more Americans would have skin in the game and understand that we have some fundamental choices to make. We cannot afford the welfare state nor can the costs to support it come from the "rich." The GOP message should be that we need to reform these programs and live within our means. If the public wants all of the benefits of the welfare state, then they must pay for them. If they want lower taxes, then we must reform our entitlement programs.
I am surprised that a relatively new FReeper (conmpared to me) would support the terrible bill that was passed yesterday and see it as a tax cut. It violates every conservative principle to support this 156 page pork laden monstrosity that will add to the deficit and debt. And it sets the stage for more concessions as Congress has delayed the sequestration cuts and for more tax hikes as a tradeoff for raising the debt limit.
I never said that I supported the bill.
I simply stated that the reason the bill adds to the deficit is because it prevented the largest tax increase in history from going into effect automatically.
With Boehner in leadership and expiring tax cuts put into law by the Bush administration ... well, this was inevitable. I opposed the Bush tax cuts in ‘01 for the same reason that some conservatives voted against them ... because temporary tax cuts are just that: Temporary tax relief. I only support permanent reduction in the marginal rates. PERIOD. Any else is garbage.
I do not have any advice for the tea-party wing of the House GOP since they seem to have postured themselves out of the negotiations. Who participated in the negotiations?
DEM House members
GOP Senate members
DEM Senate members
White House
House GOP leadership
The only group that wasn’t at the table was ... HoUSE conservatives. So they are not part of the governing coalition. Seems to be by choice because their constituents prefer a non-negotiable approach. It just is too much of the stupit. Stupit is as stupit does.