Sunday, December 02, 2012
So before the election he repeatedly said we wouldn't go over the fiscal cliff. Now he's been reelected and the lame-duck Congress is posturing with regard to what we will see on 1 January. Treasury Secretary Geithner has proposed a magnificent program of double tax increases a 200+ billion dollar stimulus package and several hundred million dollars in cuts to Medicare and Social Security. If that sounds ridiculous then believe that it is. It is a pure nonstarter for a negotiated settlement.
But let's take a step back. We've been operating here for the last four years on the principle of Obama's reverse speak. Whatever he says is exactly the opposite of what he believes and what he will do. When we remember that, we see that his promise not to go over the fiscal cliff is exactly the opposite of what he intends to have happen. He is currently in a situation in which he can get all that he wants without concern over reelection or who to blame.
He is totally comfortable blaming the Republicans and alluding to Grover Norquist having some sort of magical control over the Republican legislature. Rational people know that is not a possibility, but we've proven repeatedly that the American electorate is not rational.
Sequestration in which the Defense Department pays a huge share of the spending reductions is clearly within the Obama agenda. Restoration of the payroll tax reductions and resumption of the additional 2% of Social Security withholding is going to happen. Capital gains taxes, dividend taxes and restored higher rates for income tax are all coming. If the Bush tax cuts which had been in effect for 12 years now are allowed to expire and more than just the top 2% experience the return to Clinton era rates, Obama will have increased revenue and quite easily turn to Republicans as the cause for that penalty.
He doesn't have to cut any spending and he can clearly return to his policy of redistribution to those who supported him for reelection. "Stimulus" sounds like a means of getting the economy going. It is anything but that. It is a synonym for taking federal money and handing it to people who have been supportive of the administration.
Geithner Offers Ridiculous Proposal
Every day we get closer to the end of the year it becomes readily apparent that Pres. Obama is more than happy to see taxes go up on anybody and limits on spending disappear while he easily can point his finger at the opposition party as the cause for the pain that the country endures.
At the bottom line we should notice that the American electorate is totally unaware and simply doesn't care. It is hard to believe that the founding fathers of 1787 could have imagined such an uninvolved populace. As the song goes "we get the government we deserve"