9:38pm | “Triggers” explained.
Expect to be hearing the word “triggers” thrown around a lot this weekend. Republicans are demanding that there be consequences if spending cuts put forward by a bipartisan fiscal commission fail to pass Congress.
The Boehner plan makes a second increase in the debt limit conditional on passing those cuts to the deficit and passing a balanced budget amendment to the Constitution.
Democrats are demanding that the debt limit not be held hostage by a more cuts — and especially a balanced budget amendment which is certain to fail — and are counter-offering with spending cuts and other proposals to incentivize the consideration of the commission’s cuts by both parties
Fiddling as the debt ceiling falls in
No matter how dramatic the politics around the debt ceiling become, it’s just theater. The reality is that government is out of control, tax revenues must rise and spending must fall.
Government spending, according to the Bureau of Economic Analysis, has risen to 37% of gross domestic product from 27% in 1960. According to projections used by the bureau, that would rise to 50% by 2038. Obviously, that is not going to happen, but apparently that is the path we are on.
As for taxes, the Tax Foundation reported that from 1986 through 2009 (the most recent year for which data are available), the share of federal income tax paid by the top 5% of income earners rose from 43% to 59%, while those who paid zero income tax or were net recipients of income from the government rose from 18.5% to 51%.
http://money.msn.com/investing/fiddling-as-the-debt-ceiling-falls-in-fleckenstein.aspx