Montana Politics

Montana and the Fiscal Cliff

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This month, decisions on expiring taxes and scheduled spending cuts (known as the fiscal cliff) will set over $7 trillion of the federal budget over the next ten years. Depending on the compromise, the budget could be put on a path to being balanced and the tax code could be more progressive. A poor compromise would gut important federal programs while the national debt continues to grow. Doing nothing would likely throw the country back into recession.

Senator Baucus will be one of the deal’s main negotiators, as the chairman of the Finance Committee, overseeing the U.S. tax code and most entitlement spending. I thought I’d spend a post on the main elements of the fiscal cliff, and how they affect Montana.

Here’s are the scheduled changes for January:

  • Bush Tax Cuts for the Wealthy: Unless the Bush tax cuts are extended again, the top income tax rate will go up to 39.6% from 35%. Republicans label this as a job-killing tax increase, but a recent Congressional Budget Office study disproved that myth. According to the IRS, less than 9,000 Montanans benefit from these cuts, which are worth about $1 trillion over the next 10 years.
  • Rest of the Bush Tax Cuts: Three-quarters of the Bush tax cuts are actually for the lower and middle classes. The 2001 & 2003 tax cuts also doubled the child tax credit, reduced the penalty for married couples, and lowered the tax rate paid by the poorest from 15 percent to 10 percent. These provisions are worth about $3 trillion over the next ten years. If they expire, nearly everyone will face a tax increase.
  • Sequester. Unless Congress finds alternative cuts, both defense and non-defense spending will be cut by eight percent. Since Montana is so reliant on federal spending, these cuts will impact the state more than any other part of the fiscal cliff. The cuts are clumsily applied across the board, and every federal program is affected equally. This means fewer highway dollars, fewer staff in the Montana Social Security offices, and less federal money flowing to the cities and State agencies.
  • Payroll Tax Cut Expiration – The payroll tax, which was temporarily lowered by 2 percent in 2009 to stimulate the economy, returns to normal in January. Thus, the average Montanan making $29,400 will pay an extra $11.30 in Social Security taxes every pay period.  (The federal government has covered one-third of everyone’s Social Security payments for the last three years).
  • “Normal” Expiring Taxes. Although they’re not technically part of the fiscal cliff, hundreds of other tax provisions that expire at the end of the year. Many of them would normally be extended, but their fate is caught up in the negotiations  This includes the Wind Production Tax Credit, which helps finance the wind turbines being built across Montana. Other common one year extensions are the Medicare “doc fix” and the Alternative Minimum Tax, a tax on the wealthy which was never indexed for inflation and would hit middle-class households

Things Not Impacted:

  • Social Security and Most of Medicare – Although these are the largest federal programs, they do not face the automatic budget cuts, nor do most low-income programs.
  • War Spending – Even though the Pentagon is facing the same 8 percent cuts, all spending designated as “overseas contingency operations,” (mostly in Afghanistan, Pakistan, and Iraq) is protected at the current level.

About the author

Tyler Evilsizer

Raised in Helena, Tyler's particularly passionate about the environment, transparency, and wonky budget policy. The views expressed are his own.

45 Comments

  • It is difficult to hang a picture without a frame, and the expression “fiscal cliff,” likely emanating from the bowels of some PR agency, is such a frame. If you operate inside that frame, as you do here, then you equate various aspects of federal spending and taxation as having equal value. So Pentagon spending is not “war,” now a separate untouchable budget?, and the deficit is the most important problem we face, and all must face the firing squad. My how perceptions are managed!

    The deficit in a depression is not a problem. It did not not even become a “problem” until Bush left office and Democrats assumed majority posture. Then everyone switched sides in the public debate. Weird how that works!

    Our largest problems are easily identified – massive unemployment, aggressive wars in Asia and Africa, underwater homeowners, advancing poverty, trade agreements that undermine domestic workers … None fit within the frame. Therefore, dutifully, you did not mention them. The purpose of the concept of “fiscal cliff” is to apply austerity to popular programs, nothing more. Obama, our Kabuki dancer, will go through the motions. SS and MC are on the table, don’t kid yourself. Bowles Simpson, which Obama embraced, is the roadmap. The Obama tax cuts for the wealthy (Bush left office four years ago, did I forget to mention?) will not expire. Don’t kid yourself. The wars go on unabated, you said yourself. Unemployment will not be addressed. Trade agreements, rather than being eased, will only become bigger problems. Underwater homeowners sink. Debts that will not ever be paid still sit on the books of Wall Street propping up our imaginary fiscal health.

    Also, the “Federal Government” did not cover 1/3 of SS … Were did that come from? The “Trust Fund” did. Once you abandon the concept of Trust Fund, SS dies. There’s been persistent hinting that the concept of TF should die … Do you knowingly or unknowingly participate?

    This is a time for leadership and vision. Too bad we elected Democrats. You might say that we should work with what we have, but to work with Democrats is to undermine our own best interests.

    • Mark, Tyler actually did not express a single opinion in the piece whatsoever. He is merely laying out exactly what is in the law. For example, it is extremely helpful, especially for you values, if you have any, that Tyler points out that entitlement programs are not going to be cut automatically – if they do get cut, it will be part of a conscious decision at the negotiating table, not the automatic effects of the law as written. That’s some rather important framing. You, on the other hand are repeating the same things you always say. Parr for the course, I suppose.

      You have an interesting deductive process, by the way. We in are in largely the same mess as the Eurozone, and yet you identify as causes factors we don’t have in common with them. Unemployment is obviously a large issue – fortunately, it’s been falling for some time now, and is equal to or lower than almost all European countries. So, if you want to identify the source of an almost 8% unemployment rate, reason should tell you it must be a factor Sweden and the US, which have the same rate, have in common.

      It’s not massive wars in Africa and Asia; Sweden hasn’t been involved in a massive war for some time. It’s a very simple fact: the gap in standard of living between rich countries and developing countries has risen while the gap in productivity has narrowed. Until either we regain that edge in productivity commensurate with our higher consumption, those nations increase consumption to match their productivity, or our consumption falls to match our smaller relative productivity, we are going to continue to see an unbalanced global economy that will never be really healthy.

      • It is interesting how the framing always … always works on you. You always take them at face, never suspecting an agenda. That is so typical of a Democrat when Democrats are in power – completely credulous. Have I ever mentioned to you that I think Democrats are the problem? Probably.

        Unemployment, as we measure it, is at 8%, but as traditionally measured is at near-depression levels. Perceptions are managed via new measurement standards. Those Eurozone countries in crisis are being forced into austerity to cover banking crimes. There, like here, bankers sank the economies, and government austerity is the prescription, and will deepen the problem. That, PW, is an attack on social programs, the so-called Fiscal Cliff” the framework.

        I refer to Obama Administration wars in Africa and Asia. Don’t care about Sweden. And a rule of politics – when you see public negotiatons going on, the real negotiating has already been done. What you see is only for show. That’s how the game is played..

        • Current unemployment, the “U6” rate, is 14.4%, is a one-to-one comparison that is valid for now and the Great Depression – during the ten years prior to WWII, unemployment averaged 18.3%. So it is safe to say that our unemployment is at near-depression levels. The U6 rate, invented in 1994, removes from the unemployed labor force people who have given up finding work, and also people who are working part time because that is all that is available.

        • Mark – you are literate. Read!

          I agree that unemployment is a problem. However, your comparison to the 1930’s is shaky. First of all, unemployment was not scientifically calculated before 1940. Secondly, as very few women were working outside the home, a higher unemployment rate at that time meant a great many more families were without income even if the rates were equivalent.

          But we want to find the solution to that problem! And maybe we want to find the cause to find the solution! I mean those of who want to do something besides moan and complain about how bad the system is. So if we want to find the cause, a good place is finding commonalities between us and countries with problems of a similar nature. If Democrats or privately financed elections or even the free market economy were the source of our unemployment rate, we would expect that Sweden would not have the same problems, as it does not have our same hypothetical causes. But it does! So our (actually, your) hypothesis is likely incorrect.

          Similarly, your belief that our deficit or debt is caused by defense spending or military aggression. If that were the case, we would expect that Belgium, where military spending is about half the world average, would have a very low public debt. Obviously, this is also untrue. So again, your agenda-based statements theory lack any explanatory power.

          This is your big weakness, and it’s been pointed out to you before: you ‘Don’t care about Sweden’, or anywhere outside the US, actually, and so you live in a data cage, where useful comparisons go unmade because they would involve looking outside the US, and outside the US you have not yet finished constructing your alternate reality.

          I’ve already explained it rather satisfactorily, if I do say so myself. The Developed countries suffering from high unemployment and public debt generally have high standards of living compared to their productivity. Believe it or not, this is not a US problem, it is global, and it is affecting numerous countries, appearing to equally affect wealthy countries regardless of their income inequality. Again, I agree with you that we need to reduce that inequality and cut military spending, but so doing will not likely solve our debt or unemployment problems.

          • As you might note in my comments about the so-called Drug War above, my intent is to avoid the groupthinking that dominates these discussions. The “Fiscal Cliff” is a PR device, a framing tactic. You step in that frame, you lose. The public “negotiations” are by definition for show, as if they were real the outcome would not be known, and that is not allowed.

            The answer then is to get out of the spiral, and join the anti-austerity movement. Note that the AA movement opposes the efforts of both parties working in unison to impose austerity on every country currently targeted. Egypt right now has been hammered by the IMF, a large part of the unrest – austerity.

            When you guys write about this stuff, unless someone trips you up, you slip into groupspeak, as you did with the Drug post above, believing the words of the politicians, brains turned off, sounding tired an uncreative and … how can you take something as full of intrigue as politics, and make it so boring?

            Our problem is not deficits. Just as the Drug War is a cover for other policy objectives, so too is FC nonsense a cover for austerity, which ultimately will hit our social programs. Obama has put another $400 billion of Medicare on the table, and has offered up Food Stamps. If he were an honest man, you could say he was negotiating. But he is not. He is merely doing the work of the other party, coming around behind the social programs for his attack. That is why you guys are so dangerous. You believe in him.

            So set aside your comparisons in your honest attempt to find solutions for our problems, and learn politics. Then you might be of some use. People who really want to solve the problems are not part of the debate.

            • Mark, all the meaningless words you’re throwing out there aside, I’m really curious: how do you want Democrats to behave this month? What is the progressive course of action here? Take a bargain that raises upper income taxes in exchange for cutting entitlements? Bite the bullet, accept the budget cuts and higher taxes on the middle class as the price to pay for military cuts and taxes on the rich? How do you want to see this ending? Because my theory is that you don’t want to state an opinion because you want to retain your right to feel betrayed, and complain mightily about it, regardless of the outcome.

              • The line from the Godfather … “You can act like a man!” comes to mind. I know you imagine yourself and your party in negotiations, but you are not. You are in denial amidst betrayal – you may be a man of integrity, but you are also oblivious to the power of money in politics, and so do not recognize deceit and false intentions even as it plays out all about you.

                What would I have Democrats do? Stop trying to “help” us. Leave your party, do some actual work for progressive causes, and stop prattling on about how you see the big picture when in fact, you see very little.

                Learn politics.

                • Yes Mark ,lets shut down the two party system. Then we’ll be okay. Look at Italy – multiple parties, and no economic turmoil, unemployment, or corruption whatsoever!

              • You’re dissipating. and anyway, what about Sweden?

                In an oligarchy, only two parties are possible. No others can assemble the necessary money to overcome the artificial barriers and media exclusion. It is not a “system” so much as the naturaly byproduct of corruption.

                They are different only in degree of deceit, the Democrats being th greater of two evils.

            • Using equivalent measures of unemployment calculation, Sweden and the US have identical unemployment rates. How then can our two-party system be exclusively to blame for our unemployment rate?

              • You said that our unemplyment rate is 8%. It is not. It is 14.4%. Again, I don’t care about Sweden but do note that they have unemployment benefits, health care, higher education as part of the commons.

                And you know this, artful dodger, that your Democrats and those mean old Republicans are the same party. I come to this website for a tour of fantasy land – you all write as if money did not rule politics. It is quite a spectacle.

              • Mark –

                Like most poor American analysts, you ‘don’t care’ about Sweden, or any other country outside your own. You believe firmly that the two party system is the source of our ills, but you ignore the fact that there are numerous multi-party systems that have the same problems. Say you’ve got a hundred Hummers, some black and some grey, and you want to know why the gray ones get such bad gas mileage. Obviously all hundred have terrible mileage, but you’re only looking at a gray one, so you decide that it has bad mileage because it is gray. That’s the danger in failing to make comparisons and looking only within your own borders.

                • “The crisis brought about by the american housing collapse spread all over. ”

                  The crisis is far deeper than that, Mark. Otherwise, the US would have been hardest hit. Instead, Southern Europe was.

                  As to everything else you say, you’ve yet to provide any evidence that the power we give to private financiers has contributed to our deficit or our unemployment rate, and I’ve provided a great deal of evidence to the contrary. If public financing or multiple parties lead to better governance, shouldn’t we see less corruption, lower unemployment, or reduced deficits in other countries?

                • You’re dissembling again. Two things I notice about you: you don’t seem to think that money represents power, and that fianciers merely throw it at politicians and hope,for the best. You also don’t seem to grasp how power works. You really take the outer layers of our system as real, and consider yourself a good analyst to boot.

                  No country is perfect, but democracy does not have a fighting chance here. It’s in crisis in southern Europe as well, the bankers closing in on Greece and Spain. but i have hope for them in that they appear to have social organization and the ability to mobilize forces against power,impossible here. They may not win, but at least they know how to fight. Take a look sometime.

                  Our elections have no impact on public policy. Our public is dumbed down and diffracted. Elections are only for pressure release. The great liberals of the early 20th century knew as much. I’ll stop there. This is old ground.

              • Worst … analogy … ever. The crisis brought about by the american housing collapse spread all over.

                Now, let’s be frank: Because our system, as opposed to others, is privately financed, 1) only two parties are possible, and they are not really different other than their surface appeal to differing personality types, and 2) real power rests with the financiers. It cannot be otherwise. We operate under the illusion that politicians have power. They do not. That is only how it looks on TV.

              • Mark –

                Southern Europe will fight austerity more violently than the US will, but that won’t save them from it. If the Communists and leftists get their way, they will default on their debts, and the ensuing lack of credit will bring about the same budget cuts that they were trying to avoid. The ability to destroy your economy in the process of succumbing to the inevitable is not the mark of a better political society.

                • Weak sauce. You’re saying resistance in futile, and please note here that you are indistinguishable from the financiers who run the parties, Stockholm Syndrome I suppose. There is no difference between you and the “other” party, case closed..

                  Worst outcome, capitulation, best, end if the euro, restoration of self-government.

                  Checkout Iceland some time. They told,the IMF to fuck off and are doing fine.

                • Iceland has yet to recover the GDP they had before the crisis. Also, they didn’t exactly tell the IMF to fuck off – they said “thank you for a bailout of equal to 10% of our GDP but we’re not going to follow your advice”, and it worked out…but like I said, they still haven’t achieved their GDP they had before the crisis, whereas the US did so very quickly.

                  “Worst outcome, capitulation, best, end if the euro, restoration of self-government.”

                  End of the Euro? All right, Mark, riddle me this – who is going to lend the Greek government money if they abandon austerity and re-issue the Drachma? No one! And then they’ll be stuck having to actually balance their budget, meaning budget cuts or tax raises equal to 6.6%of GDP, triple the austerity they face now. And that’s your best case scenario? Like I’ve said before, you really have no understanding of the world outside your own country.

                • Well, maybe I understand my own country better than you then, but understand that Greece is in a straightjacket due to the euro, that without it they cold devalue their way out of the crisis and wipe put the debt. Also, just not paying it back makes sense, as it was not social spending that caused it, but rather bankers.

                  You are so bought into this trap! I think you need a vacation from party politics and conventional gotcha! thinking. Instead think that possibly this might maybe be a trap and we shoud not walk into it. As i said, you don’t seem to have a clue about the workings of power. The very idea that we have a crisis and that something has to be done is FJRA thinking, the bait. Just ignore it and we’re doing fine.

                • “but understand that Greece is in a straightjacket due to the euro, that without it they cold devalue their way out of the crisis and wipe put the debt.”

                  Their debt is not in Drachma, so devaluing the Drachma will have no direct effect on the size of Greece’s sovereign debt. Devaluation will need to be coupled with a debt default, or ‘just not paying it back’, which makes sense in your mind. Again, a comparison is useful.

                  Argentina was in a very similar situation in 2001 – their currency was tied to the dollar much like Greece’s with the monetary union, their debt was crushing and their economy was shrinking. They did what you are proposing: stop paying back debts, float the currency (equivalent to re-printing the Drachma). The result was that by the middle of 2002, with foreign investment frozen, over half of all Argentinians were living below the poverty level, a quarter of them in extreme poverty. Moreover, far from being the socially responsible course of action, the crisis following the debt default led to four years of increasing income inequality; inequality did not go down again until GDP started to grow.

                  Now, as to me buying into the trap: Our deficit is currently over 6% of GDP, and our public debt is 100% of GDP. This does not compare well to other countries. With the economy again growing, it is to take a look at what we can do about that. Obviously with high unemployment despite economic growth, the answer is not to cut spending for the under and unemployed, what needs to happen is for taxes on the wealthy to revert to their pre-Bush levels and military spending needs to be cut to a level commensurate with our actual military needs. But what should be done is not what will be done, neither in a two-party or a multi-party system. Either a separate agreement will be reached, or the fiscal ‘cliff’ will occur as Tyler helpfully described. Even a mass desertion of Democrats from their party can not stop that.

                • No one rationally thinks you can sleepwalk out of a crisis, but reversion to the drachma and repudiation of debt, which should not be placed on Greek citizens in any moral sense, since they did not benefit from it, seems logical. To be sitting there with the economic fascistas of the EU holdng an axe is repugnant, but their election system, even though more viable than ours, has been set aside. Argentina did what they had to do. People got hurt, but their long-term viability was better served by exorcism of the foreign debt masters. Often such behavior invites military invasion, but Argentina was apparently to big for that. Venezuela has been immensely supportive in a positive way by lending mney without demanding austerity and privitization of the commons.

                  You do realize, I hope, tat the IMF and EU are agents of the banks, and demand an end to socialism. Right? And that by stepping into their framework, you are in complete harmony with Wall Street and the right wing. Right, Democrat?

                  I am not sure we are in recovery here in terms of economic suffering, at least anecdotally from what I see around me, underwater homeowners with no help from Obiwan, debts that cannot be repaid still carried by Wall Street banks, unions still under attack with full assistance from Obiwan …. this is exactly what I feared with a Democratic victory – the right wing agenda moves ahead full steam without interference. Obiwan has given away another $200 billion th is week and you are watching in silence because he is a Democrat.

                  Anyway please, out of courtesy, please stop referring to the “two party” system. It insults my intelligence. When both parties have the same financiers, they cannot be two. They are one beast with two faces, good cop bad cop lesser and greater evil with Democrats the greater.

                  Democrats are the problem. Have I mentioned that?

                • See, you are just throwing out bits and pieces of what you’ve heard about the world, and so its not really coherent. You oppose austerity in Greece because you’ve heard that’s the socialist thing to do; you support repudiation of debts because you hate banks that much. But I want you to actually think about this, not respond with vaguely leftist non sequitors.

                  Presumably, austerity is bad because it hurts people, and it hurts people because spending is cut. IMF goals for Greece call for spending to be cut something to the tune of 2% of GDP, leaving the deficit still at 4% of GDP. These cuts will hurt, but so far Greece’s austerity programs have not had a real effect on HDI; we’ll see if the deeper cuts do. But if Greece changes their currency and repudiates their debt, they will be essentially cut off from credit, which means the deficit will have to be cut to nearly 0, nearly instantly. That’s triple the cuts with no grace period. And you think that is better for the Greek people, that it’s more moral!?!

                  There was a time when one could believe this, of course. I’m sure there are those who believed that Argentina would rise up into some kind of workers paradise when they repudiated their debt, or that they would still get loans from somewhere. We know that’s not true, and we know the Argentinian people suffered greatly as a result.

                  And then to the EU. You’d have Greece exit the Euro, making trade with 3 of their top 5 partners more difficult. You’d ignore the fact that Greece’s rate of HDI increase doubled when they adopted the Euro, achieving the same growth in five years they did in the previous ten. Again, you don’t know what you’re talking about. What you would prescribe would hurt banks, moderately, but would hurt the Greek people far more. This is demonstrable and nigh undeniable. It is not a moral position to sacrifice the well-being of the Greek population to spite global banking.

                • No one who ” cares ” about the Greek people wants to impose austerity on them during a time of contraction, utter nonsense but in tune with the righty wing tenor of the times. Further you don’t address the immorality of forcing austerity on them when they had nothing to do with the crisis. Also, I would not mind seeing the euro fold, have no doubt Greece woul have trading partners without it and am not so uninformed as to think that rising and falling tides can be attributed to the boats in the harbor, as you have done. Argentina needed to be freed from IMF which is merely a force for imposition of private capitalization of public systems. Wasn’t it W hawking for Enron when Argentina was going through IMF imposed throes?

                  Amazingly you sound like a fried a note, who did such wonders for Chili and Argentina. Are you next going to wish for return of the generals? Make what you will of my knowledges, but you are framed and hanged in neoclassical nonsense, giving us unsustainable financial markets, boom bust, and which are then turned on social programs to fix their self imposed problems.

                  Can’t spellcheck.

                • I don’t support imposing austerity on the Greek people, either, but that’s not the choice of the Greek people. Right now they have to choose whether they will accept austerity or default. The morality of forcing them to accept austerity has nothing to do with the choices they ultimately have to make. They can choose to slowly contract their government spending, or they can choose to slash it immediately. Those are their choices, and one is clearly better than the other. Out of spite, you are supporting the one that will cause more suffering to the Greek people.

                  As to Argentina, if the actions they took were really in the best interest of the society, they would not have increased already high levels of income inequality. Defaulting on debt is the act of a government too weak to responsibly manage its finances or increase revenue. It undeniably increases the suffering of the populace, but it frees the government from trying to extract more revenue from its people, especially whatever constituencies it deems important. Greece could obviate the need for 80% of its austerity simply by cracking down on tax evasion (the US could benefit, too, from doing so).

                  If a Greek default and reversion to the Drachma had the same results we saw in Argentina, you’ll see many ordinary Greeks lose many of their Euro-denominated savings in Greek banks in the transfer of currencies. Who will be okay? The wealthiest Greeks who keep their money in Swiss or American banks, denominated in Francs or Dollars. Again, punishing ordinary Greeks trying to ‘stick it’ to the IMF and the bankers, who will mostly mark down the losses as just another business expense in their continual quest to discredit the welfare state.

    • Mark,

      As PW said, I actually was just laying out the facts…the things that will happen automatically in January if nothing is done. I agree with a lot of the problems you laid out–persistent unemployment, overextended wars, and too little attention to poverty.

      And yes, general revenues from the federal government have been covering one-third of everyone’s SS payments. The employee share of SS taxes is normally 6.2% of wages. As part of the 2009 payroll tax holiday, the payroll tax was reduced to 4.2% percent, letting people have more take-home pay to bolster the economy. However, reducing the tax rate would mean that everybody has fewer wages credited to their future Social Security payments (and less money for the Trust Funds).

      The federal government has been paying the additional two percent, so the Trust Funds are not impacted from the holiday.

      • The “facts” are carefully laid out for you, and like a line dancer in Las Vegas, certain movements are expected of you. If you don’t perform those movements, you are out of sync, and lose your job.

        It’s framing. If you don’t dance, you don’t have a job. I’m just saying that not performing the leg kicking is honorable, takes courage and thought, often leads to frustration, but is an honorable way to live. When they say kick your pretty legs in unison, stand tall, hold your legs in place, be marginalized of course, but also fail to be a tool.

        You’ll be a man, my son.

          • These programs are so popular that they never come under direct attack. They are always under siege, and Democrats are more dangerous because the public foolishly assumes your party wants to protect the programs. This allows Obama to put them on the table behind the scenes, and at the same time cut the balls off of public support. Clinton too was expert at this game, triangulation they called it then.

            Good grief, Tyler – learn politics! Words of public officials are never spoken for meaning, only for effect. Our safety net is currently under attack, your party at the helm, you apparently blissfully unaware.

  • Nothing progressive in this “deal.” Bowles is an investment banker, Baucus was the key vote needed to pass “The Bush Tax Cuts,” and what needs to be said about the pride of Cody, Wyoming, Alan Simpson. That dude can dance to any tune in the juke box. Austerity was decided upon years ago, probably right around the time when Obama appointed members of the debt committee. Austerity is global. The New Deal was the last big deal for workers and the poor in Washington, D.C. This could be the final nail in the New Deal’s coffin — more deregulated robbery by Wall Street. “Fiscal Cliff” is zombie-speak.

    • You bought in. Why did you not just say so. B-S failed to reach agreement, so Obama chose to pretend they did, as it works the austerity agenda. Often Obama, following the Clinton practice, will lead you down a garden path helping you imagine that he is on your side. his prevents opposition from gelling,then he pulls the rug. Tried and true. That is what is store for you. Obama is a con man.

        • You bought in, then. You think that deficits are our problem. You sound terribly like a Republican, you know, and this has been our complaint from the beginning – we can’t tell the difference between the parties.

          • Perhaps I don’t sound like a big-spending liberal, but deficits are a problem. Maybe not immediately, since deficit spending helps to end this stubborn recession.

            But soon, Congress will have to learn some fiscal restraint. The U.S. will not be able to borrow $1 trillion per year indefinitely. Medicare and Social Security are solvent in the short-term, but the Trust Funds run out in 2024 and 2036, respectively. Tweaking these programs sooner, rather than later, will prevent massive future benefit cuts or tax increases.

            Perhaps these are Republican talking points, but they were also Democratic talking points a few years ago. It’s also demographic reality.

            • “The U.S. will not be able to borrow $1 trillion per year indefinitely. ”

              No one thinks that. Why do you even bring it up? But we can for the near future, and that is all that matters. In the meantime, we’ve got unemployment and poverty to address, wars to end and military spending to cut, social programs to protect, taxes on wealth to raise, new taxes on Wall Street to consider … oh wait. Your two parties are doing none of this. Instead, they are playing Chicken Little with the deficit. It’s an agenda. You either buy in or you don’t get to play. That’s why it is called framing.

  • An actual government fiscal crisis will begin when investors no longer roll over U.S. Treasury Bonds at maturity. That’s clearly not happening now. Not even close. Yield is far below inflation. Not that debt isn’t a problem, it is. It’s just way down the list of immediate priorities in my opinion.

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