Remember the "lie of the year" for 2010? As PolitiFact called it, Republicans pushing a wheel chair bound grandma off the cliff (in their opposition to Obamacare) took the honors that year. But in 2013, someone is about to be thrown off the cliff alright - this time for real - and it is the American economy!
Yes America, we are the latest pawns in a game of political chicken. As Senator Murray (D-WA) echoed the President's sentiment, Democrats are ready to let all the Bush tax rates expire if Republicans do not relent on the top bracket being sacrificed at the alter of collectivism. Despite the CBO and Fed's warnings that letting the Bush cuts expire is forecast to cost upwards of nearly a million jobs and 3% in GDP growth (and remember that the economy has barely been growing 2%), Democrat demagogues are willing to cause a catastrophe in order to score what they perceive to be political points in their pursuit of fostering class warfare.
It is in holding with expected Democrat hypocrisy that the President himself had said a couple of years ago "the last thing you want to do when the economy is barely breathing is to raise taxes". Yet, when the economy is struggling even more than when those words by uttered by Obama, the Democrat mantra has changed thanks solely to political convenience. The question remains whether the Republicans will blink first.
Republicans need to hold strong here and make Obama veto a bill keeping all of the Bush rates in place. Then, once again, they need to point out that the so-called rich, making over $200,000 per year, already carry more than their weight as far as tax revenues are concerned. Those Americans who are still uninformed of the fact (thanks to the complicit media) that the top 1% who make 17% of the national income already pay 37% of the federal income taxes, or that the bottom half who make 13% of the national income pay only 2% of the taxes, or for that matter the inescapable fact that the higher taxes will hit 900,000 small businesses by the Administration's own estimates, will know who to hold responsible when the economy goes off the cliff come 2013. And it won't be the Republicans provided that they can effectively get their message out!
It is high time for conservative voices to draw distinctive lines between their individual freedom oriented philosophy and the collectivist philosophy of Democrats that is antithetical to our founding principles that has allowed us to be the most powerful, prosperous, and generous nation on earth.
4 comments:
You won't like what I have to say, but I seriously think that the US government will default at some stage. When you look at the upcoming Social Security obligations, and the yawning deficits and the failure of the Obama stimulus to actually stimulate anything, the whole thing just can't work. Maybe Europe will fail first, maybe not, hard to guess that one.
Sure, I agree that Romney (on the whole) would be a better economic manager than Obama. Sure, the economy is the number one issue facing the USA and the different between a strong economy and a weak economy will make a big difference to the hardship felt by Americans.
However, there are deeper problems, like lack of overall respect for the Constitution, and people just don't believe in freedom anymore. They already drank the Kool Aid, now they just wait to see what happens. So if Obama wins next election then the problem will manifest itself quickly, and if Romney wins then the problem will just take a bit longer to come to a head.
In terms of how the US can default, I can see some options:
* Outright default (unlikely) where the government just throws hands in the air.
* Inflationary default (likely) where the inflation creates new money to pay old debts.
* Cutting benefits (maybe) just tell the retired people that Social Security ain't going to give them what they expect, sorry, too bad.
None of these options are good. I'm feeling a bit safer in Australia because we are protected by the resource boom. On the other hand, our government is very Socialist but fortunately also very incompetent. In Australia we can afford to lose a bit of fat :-)
I may not like it, but I agree whole heartedly with you Tel. I do not see any way out of this mess. Even if we had the leadership to cut the federal budget by 40-50% to 2000 levels (around $2.2 trillion or so), I do not see the coming avelanche of unfunded liabilities getting too much smaller, let alone our spending habits.
The likely outcome will be, we will print money, cheapen/debase the dollar, and try to pay the debt off that way while everyone suffers.
What would you say to this proposal as an alternative solution (I know it will never happen due to politics)? We cut the budget down by 50%. Eliminate all federal departments except for defense, state, treasury, and a catch all department of sorts. Cut taxes radically - in fact institute a flat 10% or so income and corporate tax. Eliminate cap gains taxes. And finally, for the most controversial aspect of the plan, let the federal government go in to business of oil and gas drilling. The U.S. has the largest oil and gas reserves in the world though much of it is off limits. I know, we are against federal involvement of this type, but if we (the government) drilled agressively, everywhere we can and used the profits from the sale of oil and gas to pay off our federal debt - ofcourse, with a sunset provision that forces the government to turn over the operations to the private sector when the debt is paid off.
I thought I would never consider such drastic measures but the hopelessness of the situation is forcing me to temporarily betray some of my long held views.
I will admit I'm an Atheist, I don't expect God to step in and save me. I'm also a believer in evolution, and if you look through some history books you can see that people went through very hard times indeed. Despite the problems of the past, more people are alive today than ever before.
These things have a way of working themselves out. Suppose the system descends into an inflationary spiral... but some people protect themselves against inflation. Then those people who planned ahead will be the successful people who start a new generation.
On the other hand, suppose the system degrades into violence, then the people who are best adapted to violence will be the ones who get ahead.
On an optimistic note, if all of this is idle speculation and we all end up better than we hoped, then the people who made speculative investments will be rewarded and everyone else will be left behind.
Whatever happens, the right answer will be whatever works on the day, and that's the great thing about evolution -- it's a tautology and thus always correct retrospectively. Not very useful for planning ahead I admit, but just think that your ancestors going back generations are the very best of their breed, and somehow they got this far. So never give up.
The way I see it, if government does default then people will learn not to trust government. Is that a bad thing? How else will they learn?
I like your wisdom, Tel.
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