I’m here to wish everybody a Happy New Year.
But I have to emphasize that it is a wish, not an expectation. In fact, while I am usually cautiously pessimistic, I am throwing caution to the wind this time, and admitting that I think my wish is pretty much a pipe dream.
I think we are in for a very unlucky 2013.
The frenzy as of this writing is whether Congress and President Obama will come to some kind of agreement that will prevent us from plunging off the alleged “fiscal cliff” into economic oblivion on Tuesday morning. If they can just do that, we’ve been told by numerous TV talking heads, we can all ride off into a secure, prosperous new year. If not, we’ll do our own version of the Mayans’ end of the world.
But that is mostly a manufactured frenzy. If either side seriously thought the economy would collapse over a cliff that is more like a curb, there would be serious negotiation going on. Instead, there is mainly posturing and spin.
The hard work going on right now is not about how to address the real fiscal cliff facing the coming American generations, but about trying to convince the country who to blame if Jan. 1 arrives and a scheduled combination of tax increases and spending cuts take effect – a deadline that Congress and the president created through a previous agreement.
The thing is, we really do have a crisis. It’s just not the kind of crisis that eating the rich is going to fix.
But nobody wants to talk about that – not when the blame game is so much more fun and such an easy distraction. Democrats are generally better at it. And, sure enough, most voters seem to think that if the GOP would just go along with the president – and agree to tax the fat cats, bankers, corporate jet owners and everybody else who didn’t realize that, “at some point you’ve made enough money (and the rest should go to the government)” – our deficits and debt would melt away without any need for limits in Social Security, Medicare, Medicaid, welfare and endless unemployment insurance.
So, “compromise” means Republicans agreeing to tax increases on the wealthy (and semi-wealthy) now, and Obama saying he will “consider” spending controls later.
I think Republicans ought to say: Forget it, let’s step off the fiscal curb. Why not?
A couple of months after Obama is safely reelected and we have been spared the alleged depredations of a Romney administration, economists of all persuasions suddenly are saying what a few of us have said all along – that there are not nearly enough millionaires and billionaires (even those who make only one-fifth of a million a year) to nibble away at our catastrophic debt and deficits by taxing them more heavily.
If we are ever going to address that problem, the bulk of the money is going to have to come from the middle class, because that is where the bulk of the money is. So, why not let them start helping out starting Tuesday?
It is a mystery to me why Obama, Democrats in Congress – indeed any liberal anywhere – could object to the expiration of the “Bush tax cuts” for everybody, not just the rich. All that means is tax rates will go back to where they were for everybody under President Clinton. And you know, liberals can’t stop talking about how awesomely wonderful the economy was under the Clinton tax rates.
So, bring back the ’90s rates and those halcyon days will come roaring back, right?
Uh, well, now that the moment is upon us, it seems Democrats don’t believe it enough to let it happen without trying to blame Republicans for what they say will be disaster.
It seems they may finally be acknowledging that it was the Internet bubble, not higher tax rates, that had just about everything to do with the roaring economy. The reality is you or I could have been president, and the economy would have been great and we would have looked like geniuses.
But, even if things won’t be so grand, remember 18 months ago when the president told us we were going to have to “eat our peas?” I actually love peas – I’d eat a plateful of them – but of course that’s not what the president meant.
He was talking about pain. He even said at the time that we were going to have to “share sacrifice,” instead of his current stance that only people making more than $200,000 need to sacrifice.
In fact, stepping off the fiscal curb would probably be the fairest way for this administration to stop borrowing $3 billion a day to live in the kind of fantasy world that is going to leave our children and grandchildren broke.
But none of that will happen. Only taxes on the rich will rise. Spending won’t be cut in any substantive way.
And people will respond just as they always have to financial incentives. Entrepreneurs will be discouraged from becoming too successful and creating the jobs that come along with that. A larger and larger percentage of the population will become dependent on government because they’ve been told that’s a good thing and they deserve it.
Then it will still be all about who to blame. My guess is that it won’t be Obama.
Taylor Armerding is an independent columnist. Contact him at email@example.com