The real fiscal cliff

The real fiscal cliff.

But no one … at this point seems to have grasped that [nothing will be solved] unless the avoidance of the fiscal cliff includes measures that radically cut the deficit and end the unspeakable fraud of 70 percent of the country’s $1 to $1.5 trillion federal deficit being covered by phony notes cyber-clicked into existence from the Treasury’s 100 percent subsidiary, the Federal Reserve. No test of psychological confidence will be passed by this charade, nor any test of Grade 3 arithmetic either. The administration swaddles itself in a few weeks of a record-breaking rise in economic-growth and tax-collection rates. But this is only three weeks, and applies to a built-in annual budget deficit of $1.5 trillion on top of an accumulated national debt that took 232 years to get to $10 trillion in 2008 and made it to $16 trillion this year. (And there are still 5 million fewer people working in the U.S. than there were four years ago.) [emphasis mine]

This fake political term, “The fiscal cliff”, is an unmitigated lie, created by politicians to disguise their failure to actually deal with the debt. They are using it to avoid even cutting spending levels back to 2008 numbers, a reduction in spending that would hardly be noticed in the bloated, overweight, and increasingly oppressive federal bureaucracy.

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8 comments

  • wodun

    Exactly, the fiscal cliff isn’t preventing Bush tax cuts to expire, Obama wants tax increases asbpart of any deal, and the cliff isn’t preventing sequestration cuts because we need cuts greater than sequestration to get spending under control.

    The fiscal cliff is not controlling short term and long term spending but the Democrats and their media have successfully made this about preventing cuts and raising taxes on the rich and Obama is happy to take money from the poor and middle class if he can blame it on someone else.

    Absent from the discussion is the 3.9% tax increase on millionaires and billionaires making $250k a year from Obamacare, nearly equal to the tax rate reduction enacted by Bush.

  • JGL

    The American people have been delivered to the modern form of slavery, debt, entitlement and socialism.

  • Richard

    Just wait until the Fed is forced to raise rates to more normal levels (about three points higher + inflation). 16T x .03 = $480M extra in annual interest as Treasuries mature and replacements are sold at the higher rate. Congress finds it difficult to cut $10B from the budget. Where will they find cuts of almost a half trillion dollars per year. Will we be stuck with a VAT in addition to all the other Obama tax increases. As Mark Steyn says, it’s Greece here we come.

  • Jim

    This fiscal cliff just demonstrates the lack of seriousness both sides take to spending cuts, more pointedly deficit reduction.
    Know this….any move away from the fiscal cliff is a move toward REDUCING the $1.2T in cuts that is in the “cliff.” That number is not going to go up. In other words, if we do not go over the cliff, it is because both sides wanted the dollar amount of cuts to go down. Both sides. If Republicans think they can negotiate the dollar amount of cuts to defense downward, and not expect Democrats to say cuts to entitlements also then have to go downward, they are living in a fantasy.

    I do not understand why the Republicans simply do not take the cliff, and then agree with Democrats to restoring the Bush cuts for 98% of the country, and declare victory. Why? They will have achieved the Bush tax cuts for 98% of the country (and just think of that, Democrats agreeing to tax rates that Bush wanted for 98% of the country. You lost on 2%? Too bad, that’s democracy), and the largest spending cuts that, quite honestly, are even possible in this economy. $1.2 Trillion. That number will not get any bigger right now. Yes, it has defense cuts, but those cuts will still mean this country spends as much on the military as the next 15 countries combined.

    Both the top 2% of wage earners, and the military, will survive quite nicely, thank you very much. If you think that would be a victory for Democrats, you don’t remember what Democrats at one time stood for.

    • JGL

      These are no longer Democrats, they are now Socialists at the minimum.

      I had two customers in my place the other day, politics comes up and one proudly says to me

      “Oh, I am a Socialist”

      the other one says

      “yeah, Im also a Socialist”.

      I said “dope number one meet dope number two”.

    • wodun

      I agree, sequestration should be viewed as a good first step and it is likely the best deal Republicans can get. If the Republicans were smart they would pass a permanent extention for the bottom 4 brackets to keep as much of the Bush tax cuts as possible because when they are forced to vote for them later, they will be called the Obama tax cuts for the poor and middle class.

      Over time, it would also show how raising taxes on the rich wont solve our spending problem.

      • Jim

        Holding out for the 2% is ridiculous, and I agree with Bill Kristol on this. Half of them voted for Obama anyway, and its such a small voting bloc it does not impact elections. The ones that don’t want their taxes raised are going to donate to Democrats next time rather than Republicans? Sure they will.

        But alas, the cliff will not happen, and everyone on the right will realize that instead of $1.2T in cuts it is something less. And they will go back to complaining about Democrats when the solution (as you say, the start of the solution) had been already approved by both sides, and then rejected.

  • Chris Kirkendall

    …because when they are forced to vote for them later, they will be called the Obama tax cuts for the poor and middle class.

    I think this is exactly right – Obama the other day hinted he’d come back & do tax cuts later – the very WORST thing that could happen would be that Repubs get blamed for everyone’s taxes going up, then Obama rides in heroically on his white horse & proposes the exact same cuts (except for the top 2%) we already had, and suddenly becomes the savior of the lower & middle classes. This is all just political theater anyway – as the article said (& others have said here), none of this even begins to address the huge problem of deficits…

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