Commentary follows the hi-lighted
footnotes.
President, Americans for Tax Reform
Two Thoughts on Navigating the "Fiscal Cliff"
Posted: 11/21/2012 5:46 pm
On January 1, 2013 three things happen:
First, the 2001 and 2003 tax cuts lapse along with a number of temporary
tax reductions that have been extended so many times they are collectively
known as "the extenders." (Note to self: possible name for female
rock band.)[1]
This collection of tax hikes total
$500 billion in 2013. The $1,000 per child tax credit drops to $500. The Obama
Social Security tax holiday ends again. The bottom tax rate jumps from 10
percent to 15 percent and the top personal income tax rate jumps from 35 to
39.6 percent -- plus Obamacare's new 3.8 percent surtax: total for top rate
43.4%. (Do be sure to add 10.3 percent for the state income tax if you live in
California, 5.75 percent in Maryland or 8.82 percent in New York.)
And unless changed, the AMT will hit 30 million families, up from 4 million
last year.[2] The AMT was originally created as the
quintessential "tax on the rich" targeting all of 155 people.[3]
Second, the "sequestration" or automatic spending reductions of
about $100 billion a year for ten years. This will save taxpayers $1.2 trillion
over the decade and was part of the Budget Control Act (BCA) that Obama and
Boehner agreed to in 2011 to "pay for" the debt ceiling increase.[4]
Third, the surtax on income of 2.9 percent rises to 3.8 percent and
starting January 1, 2013 it hits capital gains making the total top rate not
today's 15 percent, not Bill Clinton's 20 percent, but 23.8 percent. The top
rate on dividends increases from today's 15 percent to not just 35 or 39.6
percent, but 43.4 percent total. (And then add state and local income taxes.)[5]
Obama would like to have a "grand bargain" -- as in 1982 or 1990
-- where Republicans were promised they would get three or two dollars of
spending reduction for every dollar of tax increase. (The tax hikes were real
and permanent and spending was not cut but actually rose from baseline.) Reagan
said 1982 was his greatest mistake. His second biggest mistake learned nothing
and agreed in 1990 to "two imaginary dollars" of spending cuts for
each dollar of tax hike.[6]
How can Americans protect themselves against being TARPed again? This new
verb is a favorite of congressmen and senators who feel they were rushed to
vote for the Troubled Assets Relief Program the way a sleazy salesman urges you
to buy the aluminum siding NOW without bothering your pretty little head with
reading the contract.[7]
There are two protections available to the American people:
First, we can and should demand that
the negotiations between Congress and the White House on continuing the various
"Bush" tax cuts be done in front of C-SPAN cameras. No more secret negotiations. Open
covenants, openly arrived at. Every American -- not just PHARMA and the
insurance companies -- should be in the room when something as large as
Obamacare or today's $500 billion tax hike is under discussion.[8]
Republicans should promise not to be snarky and must resist the temptation
to remind Americans that C-SPAN coverage of such talks was one of Obama's key
promises in 2008. Oh, well. Better late than never.[9]
C-SPAN cameras will allow Americans to know who is being reasonable and who
is not. Who presents real solutions and who repeats talking points. If Republicans
demand the negotiations be covered by C-SPAN and Obama refuses -- then we would
know, as King Solomon did -- who is acting in good faith and who is not.
Perhaps Obama is dealing from the top of the deck and he will demand C-SPAN
start-to-finish coverage.
Second, once a "deal" is
agreed to, it should be written down in legislative language and put online for
every American to read for seven full days: 168 hours. No rushing tired congressmen before
cameras to endorse legislation they have not read because it only exists in
outline form in someone else's briefcase.[10]
If going into these "fiscal cliff" negotiations every participant
knows that both his private and public statements will be heard by all
Americans and that the final work product must stand the test of being read by
citizens, the chance of another 1982 or 1990 or TARP 2008 will be greatly
reduced.[11] Risk
can rarely be taken to zero. But the ability of the American people to watch
the sausage made and read the contract before signing is a better guardian of
our future than the hurried endorsements of the Washington establishment based
on private assurances of politicians.[12]
Commentary from the desk of We The
Peeps1:
From the man who was to propel
the GOP into the White House and gain control of the U.S. Senate, here is an
article by Grover Norquist. Read with a careful eye and a smattering of history,
this article seems to signal a sea change in the behind the scenes maneuvering
in the Republican Party. If, indeed, Norquist is a “shaker and mover” in the
GOP, what we have here is an “about face” in rhetoric, at the very least.
Based on the hi-lighted
footnotes I placed throughout the article, we need to straighten a few things
out:
[1] ...."the extenders." (Note to
self: possible name for female rock
band.)
Haven’t the folks of the Republican
Party figured out that there are more women
voters than
men? When do they
intend to stop their verbal and fiscal assault on the women of
this Country?
[2]
...30 million
families, up from 4 million last year.
Did anyone send the memo to dear little
Grover that the Affordable Health Care Act
kicked in this year, with more to
come in 2013 & 2014? This increase is a calculated
and known increase due precisely to that
Act. This is a qouting of fact that has
absolutely no bearing on our fiscal
woes, at the moment.
[3]
...targeting all of
155 people.
This number is misleading, if you don’t
put it in context. It is a number from 1980
and the Reagan years. As of 2012,
there are vastly more “Millionaires” than there
were way back then.
[4]
...Budget Control
Act (BCA) that Obama and Boehner agreed to in
2011...
To include a statement like this one is
totally meaningless. It has no relevance
whatsoever to any argument Grover could
pose.
[5]
...increases from
today's 15 percent to not just 35 or 39.6 percent,
but 43.4 percent...
This is what they are complaining
about? How about asking the elder
Senators and
Representatives what
their Fathers and Grandfathers paid in taxes for Capital Gains
and Dividends? Those figures
reached up to 90%, in some cases.
[6]
..."two
imaginary dollars" of spending cuts for each dollar of tax
hike....
Well, there you go, again. Trashing
Ronnie for a few “minor” little mistakes he made
in his vision of fiscal integrity for this
Nation. OOOPS!
[7]
...congressmen and
senators who feel they were rushed to vote
for the Troubled Assets Relief
Program the way a sleazy
salesman.......
And, why was it that they
were “rushed”? The Republican filibuster in the Senate
caused the Bill to get backed into a
corner at the Eleventh hour. The “sleazy
salesmen” were your boys, Grover.
[8]
...done in front of C-SPAN cameras. No more secret negotiations.
Um...Mr. Norquist, do you think any of
your puppets would ever agree to be live on
camera, and doing the Nation’s
business? You really do think that we’ve all lost our
ability to remember just how infantile your
Congressional Lemmings really are.
Really? Cameras? Live?
[9] ...Oh, well. Better late than never...
Do I hear Grover
coming over to President Obama’s point of view? Ladies and
Gentlemen, we have a flip-flop!
[10] ...and put online
for every American to read for seven full days....
I don’t know
about your tired, overworked Congressmen and Senators, but the
American People could very easily read
these documents, front to back, at least twice
in the given time frame. And, after all, isn’t transparency
a Democratic issue?
[11]
...the chance of
another 1982 or 1990 or TARP 2008 will be
greatly reduced...
I’m actually
beginning to think Grover is a Democrat, or, at least, a centrist and a
moderate.
[12] ...the ability of the American people to watch the sausage made
and...
So, according to Grover Norquist, our National Legislation is akin to a
sausage? I
hope this mislead, unfortunate man gets off
the bus at the very next stop. The
American People have endured enough of this oral diarrhea,
and its time to clean up
our ride into 2013 and beyond.
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