A portrait of our leadership: On the 13th hour leaning into the fiscal cliff deal Boehner tells Reid to “Go f--- yourself” while Reid pitches a proposal from President Obama into a fireplace. Who elected all these Citizen Kanes and what kind of perverse deal did they actually broker? A Congressionally typical solution about as solvent as slapping duct tape on a popped tire! As Nick Gillespie noted “the government has effectively kicked the can so far down the road that they’ve run out of road.”
Here’s the snapshot:
• Increased tax rate to nearly 40% for individuals making more than $400,000 and married couples making more than $450,000.
• Double tax on dividends and capital gains (including Affordable Care Act investment income tax provision).
• Extension of unemployment benefits.
• Increase in Medicare spending to cover reimbursement payments for providers.
• Extension of debt ceiling.
• Nothing substantial on spending cuts.
The Democrats were able to wrangle the income tax hike on individuals making $400,000 plus (couples making $450,000 plus) but this remains nothing more than a political ploy. With numerous loopholes in the current tax code, wealthier Americans, who can afford to hire tax advisors who profit off these potholes, can still effectively dodge the hike. Close the holes and reform the tax code. A more sensible proposal would be stripping the NRA and labor unions of their tax-exempt status and having those interest groups chip in their fair share. Furthermore, bouts over taxation remain characteristically political grumbling rather than substantially economic. This is historically too American. The colonists deemed it tyrannical for the British Empire to use taxation as a measure for recovering costs from the French-Indian War which was fought largely to expand the frontier. Today, a conglomerate of Americans wants government benefits but prefer the bill stay on someone else’s doorstep.
Concurrent increases on dividends and capital gains from 15 to 20 percent only harangue the fiscally responsible aiming to establish private retirement accounts independent of Social Security that bolster the economy through investment. What concrete science is there in deterring Americans from operating outside of the dependency syndrome the government seems determined to continuously nurse? An extension of unemployment benefits is understandable and a safety net with substance a pillar of American ethos; however, they should be transitional benefits that foster progression and eventual independence, not wallowing stagnation and a subculture of ‘living off the dole’. Medicare is another backstop with fine intent and conservative cawing for its obliteration is ridiculous, but it doesn’t necessarily combat often bloated medical costs, it only compensates for the gap. The same goes with unacceptably high tuition costs for undergraduate education. There’s no incentive for private colleges to re-look their overhead and markups and truly fall in step withhttp://reason.com/archives/2013/01/02/fiscal-irresponsibility-day the law of supply and demand when loan assistance subsidizes the gap students can’t otherwise afford. Money is still being lost, ill-spent, and students are graduating with unchecked debt.
Alarmingly, the most critical issue in the fiscal cliff crisis remains unaddressed: as George Will notes, “deficit spending was once largely for investments which benefited the future generations. Now, however, continuous borrowing burdens future generations in order to finance current consumption.” With an ever-growing 24.3% federal government expenditure as a percent of GDP and a Baby Boomer retirement bomb hot on the horizon, it appears President Obama’s pledge to “maintain fiscal responsibility so that we do not mortgage our children’s future” rots along with the closing of Guantanamo, Afghanistan withdrawal, and the curtailing of lobbyist influence. Hence, the deal brokered chimes as nothing more than a momentary lapse of reason- and a temporal lapse of collapse. Why aren’t we looking at Europe: “There but for the grace of God, go I…”?