Free Republic

This week, when speaking at children's toy K'NEX factory in Pennsylvania, President Obama urged the House of Representatives merely to pass what Harry Reid's Senate has passed and send him the bill. The Senate has already passed a bill to keep income taxes from going up on middle-class families. That’s already passed the Senate. Your member of Congress like Allyson and Chaka, other Democrats in the House, they're ready to go. They're ready to vote on that same thing. And if we can just get a few House Republicans on board, we can pass the bill in the House. It...

The idea behind a grand bargain to get the federal budget deficit under control is a simple one. Republicans agree to tax increases and Democrats agree to spending cuts. In a previous post I warned that this could be a trap for Republicans, just like similar budget deals have been in the past.There are two problems. First, the tax increases will hit immediately, while the spending cuts will be mainly in the future. That means future Congress's will have an opportunity to renege on the agreement before any serious spending reduction takes place. Second, all the serious spending increases in...

President Barack Obama has dramatically upped his demands in the fiscal crisis negotiations: He wants Congress to levy twice as much in extra taxes from Americans as he urged during the election campaign, give up its control over the nation’s debt limit, and fund an immediate $50 billion stimulus for his political priorities. In exchange, Obama offered to consider — but not necessarily accept — GOP proposals for cutting $400 billion from Medicare and other programs strongly favored by off-year voters. That listening session would take place sometime in 2013, giving the president plenty of time to wrap the unpopular...

The White House has been hyping its #My2K Twitter hashtag in an attempt to galvanize supporters to contact their Congressional representatives to demand action to avert the fiscal cliff.  The administration estimates that unless Congress moves, the average family's tax bill will jump by more than $2,000, starting on the first of January.  The implication, of course, is that Republicans are once again standing in the way of resolving this problem.  Show of hands -- as the media breathlessly follows every minor twist and turn of these negotiations, how many of you have seen this fact reported?   .@barackobama's #My2K shenanigans ignore...

There are a large number of policies that make up the fiscal cliff: the expiration of the Bush-era income tax cuts, the end of a temporary payroll tax cut, budgetary caps on discretionary spending imposed by last year’s debt deal, a reduction in planned spending on defense as a result the sequestration process, the so-called “doc fix” which governs physician’s Medicare reimbursements. All of these policies are set to change automatically if Congress does nothing. What won’t change automatically is the fundamental shape and structure of any of the country’s major entitlements: Medicare, Medicaid, and Social Security. Yet Republicans are...

Senate Majority Whip Dick Durbin has a message for Republicans insisting on wholesale changes to entitlement programs in exchange for new tax revenue: not yet. In a speech later this morning that seeks to crystalize the progressive approach to deficit reduction, the Senate’s No. 2 Democrat will try to split the debate about overhauling Social Security, Medicare and Medicaid from the negotiations over resolving the fiscal cliff. “Progressives should be willing to talk about ways to ensure the long-term viability of Medicare and Medicaid but those conversations should not be part of a plan to avert the fiscal cliff,” Durbin...

A new CNN poll shows that more Americans would blame Republicans if the country went off the fiscal cliff rather than President Obama. 45 percent of those polled by CNN said they would blame Republicans more; 34 percent said they would blame Obama. But Republicans might have a political opportunity if they can convince Americans that President Obama is not working to cooperate with Republicans. According to CNN, nearly half say Obama is not doing enough to cooperate with the Republicans, although seven in ten want him to compromise with the GOP.

WASHINGTON — When Tea Party activists swamped town hall-style meetings about health care in the summer of 2009, President Obama’s army of campaign volunteers largely stayed away, seemingly less interested in fighting for legislation than they had been in electing the nation’s first African-American president. Now, Mr. Obama is seizing a second chance to keep his election-year supporters animated. With lawmakers scheduled to return to work on Monday to begin intense discussions before a looming fiscal deadline, Mr. Obama’s aides are trying to harness the passions that returned him to the White House, hoping to pressure Republicans in Congress to...

Should debt-ridden and economically struggling Western governments be doing everything possible to reduce their deficits? Those in favor of immediate deficit-reduction argue that it is a necessary precondition of economic growth. Today's deficits become tomorrow's debt, they say, and too much debt can bring fiscal crises, including government defaults. Markets, worried about solvency, will require high interest rates on government bonds, making it more costly for countries to service their debts. Defaults could cause banks holding government bonds to collapse, possibly leading to another financial meltdown. There can be no sustained growth, say the deficit hawks, unless we start balancing...

President Obama's proposed tax hike on the top 2% of incomes will do next to nothing to close our chronic budget deficits, now running more than $1 trillion a year. But it will have a major impact on one struggling part of our economy: small business. In his Wednesday press conference, just before meeting with representatives of the nation's largest businesses, the president again claimed his plan to reduce the deficit and avoid the fiscal cliff would mean that "97% of small businesses are not going to see their taxes go up." But this is, to put it politely, deceptive....

The Congressional Budget Office released their analysis of the group of deficit-fighting policies known as the "fiscal cliff." The big takeaway: completely averting the contraction that would occur in 2013 and 2014 would cost $1.16 trillion - entirely deficit-financed. There would certainly be some economic benefits to all of this, however. The CBO has a wide range of estimates for the positives - between 0.8% and 5% growth in real GDP, and between 1.1 million and 5.8 million new jobs. There are a lot of caveats here, as it's an incredibly wide range of estimates, but there would certainly be...

House Republicans have to stop the president from hurting the economyNow that he never has to run for election again, President Obama can show his true colors. Mr. Obama made it clear Wednesday he wants to whack Americans with $1.6 trillion in tax increases so that an obese Uncle Sam won’t have to go on a diet. The only thing that can slow down his sharp turn to the left is the House GOP. “When it comes to the top 2 percent, what I’m not going to do is to extend further a tax cut for folks who don’t need...

And I quote: But as IÂ’ve said before, we canÂ’t just cut our way to prosperity. If weÂ’re serious about reducing the deficit, we have to combine spending cuts with revenue. And that means asking the wealthiest Americans to pay a little more in taxes. ... ThatÂ’s how we can reduce the deficit while still making the investments we need to build a strong middle class and a strong economy. ...Now, already, IÂ’ve put forward a detailed plan that allows us to make these investments while reducing our deficit by $4 trillion over the next decade. I want to be...

On Tuesday voters in California went the wrong way on three propositions. Voters approved Proposition 30 "temporarily" increasing the state sales tax and income tax on individuals making over $250,000. They voted against Proposition 31 that would allow the governor to cut the budget in fiscal emergencies. They voted against Proposition 32 would prevent unions from making campaign donations via members' dues. Moreover, and worse yet, Democrats picked up two more votes in the state legislature giving them a supermajority, capable of passing any tax hikes they want. Those results are so awful I suggest you prepare for the demise...

President Barack Obama and Mitt Romney will crisscross the country during the next month offering different visions for how to fix the country’s fiscal mess. But in Washington, the senators in the Gang of Six — plus two newbies — will have a secret retreat next week hosted by Sen. Mark Warner (D-Va.) to start cobbling together a plan to avoid the looming fiscal cliff. For this round of talks, the bipartisan group has added Sen. Lamar Alexander (R-Tenn.), a former member of Minority Leader Mitch McConnell’s (R-Ky.) leadership team, and Sen. Michael Bennet (D-Colo.), who has grown close to...

President Obama, ever-comfortable on the campaign trail, responded to audience cheers saying they would “love him even more” when he finished reciting his plans for his second term. An exuberant Iowa crowd kept interrupting Obama today. ” I love you back,” he said at one point, as he went through a list of goals for his second term.  “But let me tell you the fourth thing — you’ll love me even more.” ‘The fourth thing” he mentioned was  his “plan [to] reduce our deficit without sticking it to the middle class.” Obama said that he will “cut deficits by $4...

The tax cuts enacted by Congress in 2001 and 2003 - often referred to as the Bush tax cuts - provided a broad range of tax relief, including lower tax rates on income, long term capital gains, and qualified dividends. We dodged the expiration of these lower taxes back in 2010 when Congress extended the tax cuts for two years (through 2012). Now cuts are set to expire on December 31, 2012, and any action will likely come down to the wire as it did in 2010. It's difficult to predict what will happen, but three scenarios are possible: All...

The government on Monday passed a sweeping measure to tighten Israel's belt at a time when the world is facing another global financial crisis. With a vote of 20 to 9, the Cabinet approved a package of austerity measures designed to raise some NIS 14.15 billion within a year, and reduce the budget deficit by 1.5 percent. Voting against the package were the Independence and Shas parties, as well as Likud Social Services Minister Moshe Kahlon. The measures include raising taxes, increasing fines and cutting budgets. Tax Hikes and Fines Extending the “temporary” order issued in February 2011 to raise...

Sen. Joe Manchin (D-W.Va.) announced Tuesday that he will vote on Democratic legislation to extend the Bush-era tax rates. Manchin said he will join Democrats in voting to extend the rates for income up to $250,000 a year. The Democratic legislation would allow Bush-era rates on higher annual income to expire. Republicans want to extend all the rates for another year.  The vote on the Democratic plan is expected to take place on Wednesday.  "When considering these two proposals, I kept two priorities in mind: putting our fiscal house back in order and restoring fairness to the tax code," Manchin said...

Some believe Barack Obama has run out of ideas on the economy --- like, for instance, the Washington Post, which wondered aloud about that very problem last week: Obama’s message on his two-day bus tour through Ohio and Pennsylvania has been twofold. First, he pointed to modest signs of progress in rebuilding the economy–the health of the auto industry is his principal case study across Ohio’s northern tier. At the same time, he warned that the medicine offered by Romney and the Republicans is exactly the wrong prescription.As he said here Friday morning, “We tried it, and didn’t work.”But it...