Nut Up, America!

On December 4, 2012, in Past Morning Briefs, by David

If ever there was a time for Americans to stand up to the tyranny and wrongheadedness of the Republican Party, it is now. How wrong do they have to be how many times for us to say, ENOUGH!?!

In 2000, under President Bill Clinton’s this country had balanced its budget for the first time in decades. We stood by while the Bush Administration applied its voodoo economics “mandate” to the US tax code (a phrase coined by W.’s father), immediately turning our surplus into a deficit and initiating a downward spiral to the American and World economies that reached its nadir just a month before G. W. Bush left office in 2008.

America had $3 trillion in accumulated debt back in 2000, and by the time Bush left office, 8 years, three wars and a full-scale worldwide economic meltdown later, America was $12 trillion in debt, and counting. Where were the deficit hawks back when Bush cut taxes in the midst of the best economy in the history of this country? And how do you get to be a deficit hawk, a supply-sider and an anti-tax conservative all at the same time anyway? Policies like those could ONLY benefit 1 or 2% of Americans, at best. And they have.

Republicans have been wrong about every major policy decision in this country since the millennium began. From racist and sexist rhetoric, policies and campaigns, to tactics of obstruction and the publicly stated #1 strategic objective of “preventing Obama from winning a second term.” To brinksmanship and downgrading the American economy in 2011 to the Citizens United lawsuit that enabled politicos to waste north of six billion dollars in the 2012 elections. With all of that, Republicans lost those very same 2012 national elections, and they lost big.

So what makes John Boehner and Mitch McConnell think, with all of that history so freshly burned into American minds, that they can take the American economy hostage AGAIN without repercussion? Republicans have been holding back America’s economy from leaving the Great Recession Republicans started, and now they believe they have the juice to maintain all of Bush’s wrongheaded tax cuts AND force spending cuts to “entitlements” (which aren’t really entitlements at all; they are services we’ve paid for) and be willing to flush the US economy down the tubes yet again and get away with it?

Well, they can’t do it again if we don’t let them. And we can’t let them this time (or ever again if you ask me) because the stakes are too high and it isn’t what We the People want. In fact, the mandate belongs with Obama, the Democrats, and the vast majority of Americans who have been reeling from bad Republican policy for the last 12 years, and who spoke loudly and clearly less than a month ago at the ballot box.

The Good News is that Republicans are between a rock and a hard place this time. Truly. An agreement before January 1 that does all the things that Democrats were elected to do — keep middle class tax cuts intact, increase taxes on the wealthiest 2% (c’mon – the 2% who have done unbelievably well while the entire rest of the country has suffered), and keeping government services like Medicare and Social Security largely on track for those of us who have paid for them – is the critical next step in an economic comeback architected by the Obama Administration and Democrats. Government can reform programs for the old, poor and needy once it solves the revenue problem. When we get past this needless melodrama we will be on track to see growth in both American and World economies. Until Republicans screw it up again.

If no agreement is made before January 1, things get even more interesting. The ramifications of the fiscal cliff deal impact everyone, but Republican constituents will feel the brunt. Taxes will go up most on higher incomes, but the middle class will also be stung by rising tax rates and an increase to the Payroll Tax. And that’s something all parties have been told American voters don’t want. Loud and Clear. I believe raising taxes across the board will actually help our Debt problem and the country. But politicians aren’t arguing about whether or not the middle class should get further tax relief. And by the time taxes for 2013 get paid, rates likely will not have gone up on the middle class regardless of whether cliff negotiations end before or after the New Year.

So we’re really arguing about letting tax rates on the wealthy few revert to the Clinton era. That may impact upper-income conservatives (half to two-thirds of the 2%ers?), but it won’t hit the majority of Americans who are growing more and more frustrated with Congress, its less than 15% approval rate, and the lagging recovery which if it hasn’t dawned on them already, Democrats and voters will soon be able to pin squarely on the Republicans for holding up a deal to fight tax increases against a tiny portion of the population. The writing is on the wall. It’s so obvious, even moderate conservatives are starting to get it.

No matter how or when it goes down, it’s likely that none of the “fiscal cliff” provisions will ever see the light of day. Rendering all of this public hand-ringing political theatre, albeit theatre in very poor taste. However, if we don’t get a deal before the New Year, or even as we approach the Christmas holiday, what IS going to happen is that the stock market is going to tank and holiday sales – which this economy counts on in a big way – will suffer. And THAT will hurt the economy and all of us far more than the pittance of tax increases or cuts politicians are quibbling over.

Who has the biggest stake in the stock market? Is it the lower or middle class? No, it’s retirees counting on their 401Ks for long-term security, and the wealthy. Just like the Recession of 2008, and the Stalemate of 2011, the Fiscal Cliff represents a huge financial boondoggle for the wealthy few. If you know it’s coming – tipped off by Boehner’s “stalemate” comments, for example – you can get out of the market before the bloodletting begins, have your cash on the sidelines, and buy cheap when the “crisis” becomes “real.”

When things go back to normal, which happens inevitably, and they have to before the 2014 mid-term elections or Republicans will lose the House, too, the upper-most class will have made enough investment gains to offset any new taxes on those gains and the relatively modest tax increases Republicans have been crusading against like it’s the Spanish Inquisition. In truth, the only thing we have to fear is Republican policies themselves. This is why Democrats need to frame this showdown NOW as a compelling reason for America to vote Republicans out of its House majority in 2014.

What can the rest of us do? With Congress as it is now and no further pressure brought to bear, the Republican minority has a license to print money for its upper-class constituents simply by holding the economy hostage every year or two.

Here’s what:

1) Insist loudly and strongly to all who will listen that Congress DO IT’S FREAKING JOB and fix this impasse IMMEDIATELY.
2) Do not give into the dogma that results in panic whenever the US government manufactures a crisis. Do not pull your money out of the market AFTER it drops because that’s how you lock in a loss. Those who make money in these crises either get out long before the rest of us know what’s coming and get back in cheap, or they see it through until the market normalizes and the fog from the self-inflicted wound lifts.
3) Encourage Democratic legislators not to capitulate to Republican minority demands that benefit a tiny fraction of Americans. Tell them to get the economy back on track by reverting to Clinton-era tax rates on the wealthy that had our economy roaring until we the Bush tax cuts and War on Iraq sent us tumbling.
4) Recognize that the problem with our government time and time again is bad Republican policy designed to benefit the over-privileged few and work toward ending the Republican majority in the House of Representatives. This should be the long-term strategic objective of Democrats during this impasse and they must not budge.
5) Ask Congress to handle the revenue issue now, the government programs later, and also to look into other sources of revenues from protected classes such as oil companies and religions like many debt-free countries do to address our Debt going forwawrd.

The fiscal cliff isn’t nearly as cliff-y as many would have us believe. As long as we don’t get jumpy, and don’t give into Republican demands, there’s no need to fall. At all.

 

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