Wednesday, January 2, 2013
Bloomberg Headline Is Complete BS: Conflates Payroll Tax Cut With Income Tax Deal
The headline at Bloomberg here is total bullshit: "Senate-Passed Deal Means Higher Tax on 77% of Households".
The end of Obama's temporary payroll tax cut, the cause of almost everyone's tax increase, has nothing to do with the expiration of the Bush tax cuts, but that doesn't stop Bloomberg from lying about it, with a little help from the so-called non-partisan Tax Policy Center:
The budget deal passed by the U.S. Senate today would raise taxes on 77.1 percent of U.S. households, mostly because of the expiration of a payroll tax cut, according to preliminary estimates from the nonpartisan Tax Policy Center in Washington.
More than 80 percent of households with incomes between $50,000 and $200,000 would pay higher taxes. Among the households facing higher taxes, the average increase would be $1,635, the policy center said. A 2 percent payroll tax cut, enacted during the economic slowdown, is being allowed to expire as of yesterday.
The Senate deal does nothing to raise taxes on anybody except the very rich. The absence of a provision extending Obama's temporary payroll tax cut for another year does. The latter had nothing to do with the expiring Bush tax provisions, which Democrats just overwhelmingly voted to make permanent.
There's only one way to save the failing Obama: George W. Bush's tax rates.
Speaker Boehner Wins One For The Sipper
The 112th Congress just made the evil Bush tax cuts permament, and conservatives think they've lost?
People who think such things are not terribly intelligent.
Really rich people lost a little (a 13% tax increase on the backs of the top 0.3% of wage earners, who will promptly elect not to take income in the form of wages). Meanwhile the Bush tax rates are set in stone indefinitely for the remaining 99.7% of us. I say let's drink to the 2013 13% tax increase. It'll never hurt them much anyway.
Liberals voted for this. Do you understand what that means? While certain Republicans are whining loudly today that they just overturned a decades long stand against increasing tax rates and suddenly became hypocrites who can't live with themselves any longer for doing so, liberals had to cry uncle and vote in massive numbers for George Bush's tax cuts to save Obama's sorry ass. Who's the hypocrite, huh?!
The 112th Congress voted 346-175 to make the Bush tax cuts permanent, nearly 2-1, and WE LOST?! The only thing Republicans lost was their strategy of trying to link spending cuts to a tax agreement, which was not very wise. So it didn't work. Big deal. Quit whining. Declare victory. Move on. Republicans continue to hold the purse strings. So tighten them. The sequester is an opportunity. The debt ceiling is an opportunity.
I'd say it was liberals and Democrats who lost, and lost big.
Bar owner John Boehner just won one for the sipper, with a lot of help from Ol' Kentucky.
Pour me another.
Republicans Are So Stupid They Don't Even Know They Won
The Republican tax regime of George W. Bush, vilified by Democrats as the source of everything wrong with the country since 2007 when Nancy Pelosi took over as Speaker of House, was made permanent last night, mostly by Democrats and liberal Republicans, and there's narry a voice on the right crowing about the victory. Instead they're all eating crow, and in public, complaining about how they couldn't support tax increases on the rich or about the lack of spending cuts.
To the first point, they don't call Republicans the party of the rich for nothing. They have opened their mouths wide today and removed all doubt. And when it comes to the spending side, Republicans' mistake all along has been to link spending decisions to a tax package. Without a fixed lodestar of revenue, debates about spending have no point of reference. But now, happily, they do, no thanks to them. It is sad that what finally gave permanence to the Bush tax rates was Democrat fear of booking another recession by sucking money out of people's wallets which normally would get spent, crashing GDP. Saving Obama's reputation and his second term demanded it, who now thinks he just won the Cadillac when all it is is a Pontiac. There's plenty of incompetence to go around.
The Washington Post here has the vote breakdown:
The House voted 257 to 167 to send the measure to Obama for his signature; the vote came less than 24 hours after the Senate overwhelmingly approved the legislation. ...
The bill drew 85 votes from Republicans and 172 from Democrats, meaning well more than half of its support came from the Democratic minority.
With 151 Republicans voting “no,” the GOP tally fell far short of a majority of the GOP caucus. That broke a long-standing preference by Boehner to advance only bills that could draw the support of a majority of his Republican members.
Senator DeMented Jim Bailed On Fiscal Cliff Compromise Vote
Senator Jim DeMint bailed on the fiscal cliff compromise vote.
People wonder why.
Answer: it's called going Galt.
Reminder: Elected Democrats in Wisconsin did the same thing by fleeing the state to try to prevent a quorum. Not that that was the situation here. But nevertheless . . .
Really bad form, there, Jimmy boy.
Have fun wrecking the Heritage Foundation, if it were possible to wreck it even more than it already is.
OK, How Long Before The Ratings Agencies Downgrade Us Again?
I'd take bets, but that's illegal, so I'll just wager a hearty pat on the back that the next debt downgrade takes three months, tops.
George Bush Beats Obama: NYT Says Republican Fantasies Fulfilled By Democrats
 |
| I won? Hey, that doesn't make any sense. |
For once The New York Times gets it right, here, emphases added:
Just a few years ago, the tax deal pushed through the Senate in the early hours on Tuesday would have been a Republican fiscal fantasy, a sweeping bill that locks in virtually all of the Bush-era tax cuts, exempts almost all estates from taxation, and enshrines the former president's credo that dividends and capital gains should be taxed gently. ...
... a hard-fought compromise that [Republicans] could have easily framed as a victory. ...
The bill would do much more than head off the automatic tax increases and spending cuts. It would fix in place a tax code that for more than a decade has caused struggles over regular sunset provisions, temporary solutions and fleeting incentives. The bill would finally make permanent five of the six income tax rates created in 2001 by the first Bush tax cut. It would codify Mr. Bush's successful push, in 2003, to make tax rates on dividends and capital gains equal so that one form of investment income is not favored over the other. ...
The 10-year price includes $762 billion to lock in the Bush tax rates of 10 percent, 25 percent, 28 percent and 33 percent, along with some of the Bush-era 35 percent bracket; $354 billion to continue Mr. Bush's expanded child credit; and $339 billion to secure Mr. Bush's 15 percent capital gains and dividend rates for families earning less than $450,000. The alternative minimum tax fix would cost the Treasury $1.8 trillion, according to the bipartisan Joint Committee on Taxation.
Democrats say they had little choice. The Bush White House and Republican Congresses structured the tax cuts so that letting them expire would be politically difficult. Add the threat of across-the-board spending cuts if Congress does nothing, and President Obama felt he had no choice but to extend most of the tax cuts or watch the economy sink back into recession.
Ha Ha Ha Ha Ha!
House Votes For Fiscal Compromise
As reported here at 11:11 PM tonight:
By a vote of 257 to 167, the Republican-controlled House of Representatives approved a bill that fulfills President Barack Obama's re-election promise to raise taxes on top earners.
Tuesday, January 1, 2013
Businessman Senator Ron Johnson, R-WI, Votes For Fiscal Compromise
The Washington Post reports here:
Five Senate Republicans also rejected the measure, including tea party favorites Rand Paul (Ky.), Mike Lee (Utah) and Marco Rubio (Fla.), a potential contender for the 2016 Republican presidential nomination. But 40 others voted for it, including such GOP leaders on tax-and-spending policy as Sen. Patrick J. Toomey (Pa.) and Ronald H. Johnson (Wis.), a tea party star who frequently consults with conservatives in the House.
Key features of the legislation are attractive to conservatives, as noted in the story:
- The payroll tax cut expires, a recklessly irresponsible diminution of Social Security to welfare.
- Obama's pay raise for federal workers is eliminated.
- Estate tax exemption limits remain as they were and get indexed to inflation.
- The Bush tax rates, except for the top 0.3%, are made permanent for everyone.
- It's a Pyrrhic victory for Obama because instead of $4.5 trillion in new revenue, he gets $0.6 trillion.
Senate Passes Fiscal Compromise At 2 AM, 89-8
So reports CNBC and Reuters, here, noting that taxes go up only on the wealthy and that the sequester agreement cutting spending is post-poned for two months. I'm sure Standard and Poors is not amused.
Without agreement on spending cuts the US risks more downgrades of its debt rating, yet Democrats in particular seem not to care about that.
Separate reports indicated that taxes revert to the old Clinton era rates under the measure for individuals making $400,000 a year or more, which in 2011 included barely 0.3% of wage earners, or 586,000 people, and that new revenue expectations from the agreement amount to a laughable $60 billion per year. Expect this group to take even less ordinary income in the future, which came to barely $500 billion last year.
The expiration of the Bush tax cuts, combined with the sequestration cuts, was supposed to translate into ten times that new revenue per year, or $600 billion, a Pyrrhic victory for the president who was already gloating yesterday at an event clearly staged in advance for the purpose that he got Republicans to flip-flop on raising taxes.
If the House doesn't pass the bill today or tomorrow, that will complicate things, says the story:
"A new, informal deadline for Congress to legislate is now Wednesday when the current body expires and it is replaced by a new Congress chosen at last November's election."
If there is any virtue to the bill, it is that it makes a number of tax rates permanent, and permanently fixes the Alternative Minimum Tax.
The House would do well to take the deal, and press the spending cuts issue separately in two months on the sequestration, and again when the debt ceiling must be raised, but the extension of unemployment benefits yet again for another whole year could be a problem.
Like making the real thing, government sausage isn't pretty.
Monday, December 31, 2012
Progressive Lefties At TNR Recognize Senate Deal Is "Crappy" For Them
So says Tim Noah, here:
"Nevertheless, this is still a crappy deal, and Democrats should still reject it--or be quietly pleased if House Republicans reject it (as they're threatening to do)."
I agree that the deal is crappy for Democrats, really crappy, but the objective of Obama is only political. What's good for the country is meaningless. He's counting on the right in the House to reject the deal, doing for Obama what he cannot do by himself. It is the extremists of both the left and the right which cannot see how Obama is playing them. If the House had any brains they'd take the tax deal, but I don't think they will, unlike how under Pelosi the House progressives swallowed hard and took the Senate healthcare plan instead of opposing it. Better than anyone they know that ObamaCare is not the end game, but the next step to the single payer idea for which they originally stood.
Politically Obama needed to look like a compromiser, and appear reasonable and "balanced", to match his rhetoric played out over a long period, which is now very familiar to everyone. Later he can use the political capital gained thereby to appear like a genuine savior when he swoops in to offer a tax cut to the poor to relieve these unfortunate souls victimized by Republican "intransigence" over spending cuts. Obama has been telegraphing this for what seems like forever. This lousy deal for Democrats gives all the appearance of compromise, but it is intended rather to go to the heart of the split between the more conservative House Republican caucus and the more liberal Senate Republican caucus.
Once those two groups are split publically over a vote on a bill which will wreck the lives of millions, Obama is in the strongest position ever to appear the benefactor of "the middle class", the group he most wants out of his way in his attempt to level American society. In order to really screw them, he's got to get their complete confidence first. To do so he'll throw them a tax cut bone, which the doofusses will be very thankful for and will repay their master for with grateful support when he goes after their real enemy, the rich. You know, the Romneys and Buffetts of the world who look like the guys who fire them from their jobs.
The problem with true believers is that they are true. It blinds them to the way power shifts, which is why they never succeed.
Senate Cliff Deal Settles For TEN TIMES LESS Revenue Than Cliff-Diving
As reported here:
"Before [Obama] spoke, details of the emerging deal emerged. It would raise $600 billion in revenue over the next 10 years [emphasis added] by increasing tax rates for individuals making more than $400,000 and households making above $450,000 annually, officials familiar with the talks said. ... The Biden-McConnell negotiations appeared to offer the last hope for avoiding the fiscal cliff of $600 billion in tax increases and spending cuts that economists fear could throw the country back into recession."
$600 billion over ten years?
Notice how CNBC leaves out "per year" after "$600 billion" in that second part of the snip after the elipsis. A $600 billion annual hit to the economy would be bad indeed, but only because it would post as a bookkeeping negative. Government spending counts as GDP, and removing $600 billion annually from the pool of funds normally tallied under GDP would "book" a recession before we even got there.
Look, by letting the Bush tax rates expire we were supposed to face a tax increase generating revenues of $500 billion PER YEAR or so, plus $100 billion per year from separately agreed to sequestration cuts to defense and social spending from August 2011's debt-ceiling imbroglio. That's why this fiscal cliff was such a big deal. We were talking $600 billion per year in the case of the Bush tax cuts expiring, not $60 billion per year as the Senate has now agreed. Tax increases on the first $9,000 of income ALONE would have generated $65 billion per year by letting the Bush tax cuts expire on the lowest wage earners for the simple reason that that tax increase affects EVERYONE'S first $9,000 of income. That's how progressive taxation works. Keep going on up the income ladder with all those expiring Bush tax rates reverting to the higher Clinton rates and soon you are talking about $500-$600 billion PER YEAR in revenues. What do you think Obama and Dirty Harry Reid have been greedily eyeing after all? That they are caving to this "deal" just shows how really weak is their position, and how much power the House has in fact, if only they understood it.
Unless of course it is all an elaborate ruse, a trap for the House, which just might be conservative enough to reject the deal for its surrealism at a time when the political consensus in favor of "balance" is rearing its ugly head. In which case the political position of the conservative House will be marginalized more or less indefinitely, and the political power of the Senate enhanced.
The US Senate is clearly the most despicable institution in the federal system, if that were possible, for obscuring all this from the American people, for the way bipartisanship means liberals get to remain liberal while Republicans have to check their conservatism with the coat girl, for continuing to spend through borrowing, and especially for acting as a Super House in doing all this, trying to shove this crap down our throats just as it has already shoved the ObamaCare crap down our throats. Bills are supposed to originate in the House after all, but those which do are routinely ignored by the Senate, which thinks itself superior and possessed of a priority it does not have.
The problem clearly is the US Senate and the way it is elected, how long it serves, and the way it acts. If ever it were time to repeal the 17th Amendment, this is it.
Now Hear This! Obama Finally Gets 51% Of The Popular Vote!
Gee, it only took almost two months, but finally they found a way. Obama now has acheived a clear mandate to do WHATEVER HE WANTS! He's finally got 51.03% of the popular vote, for crying out loud.
Bow down and worship, America! The 47% of you (!) who didn't vote for Obama DON'T COUNT!
The Real Difference Between Sen. McCain and Pres. Obama
This one just screwed the pooch.
This one actually ate it.
Wealthy Ivy League Occupy Wall Street Extremists Captured With Explosives
Now, what would they need explosives for, hm?
Story here:
A detective discovered a plastic container with seven grams of a white chemical powder called HMTD, which is so powerful, cops evacuated several nearby buildings.
Police also found a flare launcher, which is a commercial replica of a grenade launcher; a modified 12 gauge Mossberg 500 shotgun; ammo; and nine high-capacity rifle magazines, the sources said.
Gee, remind you of anyone? You know, Obama's friends?
Peter Morici: Obama Threatens To Shakedown Everybody If The Rich Don't Cough It Up
Once again, Peter Morici of the University of Maryland gets it exactly right, here:
"The president, by being so persistent that it's my way or the highway, no spending cuts, taxes on folks over $250,000 or nothing, has basically put a pistol to the head of the middle class. It's threatened them with financial extortion if he doesn't get his way to satisfy the populist wing of the Democratic Party."
Translation: Obama is a gangster who threatens to take everyone's money if we don't give him rich people's money.
Somebody should call the cops.
Democrats Want To Kick The Sequestration Can To 2015
So reports Business Insider here:
On the spending side, the Democrats' offer would delay the "sequester" (automatic spending cuts) until 2015. This would cost an estimated $200 billion. But it would avoid the cuts to the military budget that the Republicans are so desperate to avoid.
If I were in charge of the ratings agencies if that passes, I would answer it with a swift rebuke and lower the credit rating again.
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