Mr. Sensitive

January 4, 2013

Fiscal Clunk

Filed under: Uncategorized — lbej @ 10:37

Well, we got a deal on the fiscal cliff.  Unfortunately, the bill didn’t include specific language barring future use of the term ‘fiscal cliff’ on penalty of death; it could be time for some vigilante justice.

Did the deal go down how I expected it to?  Let’s see.  Nothing passed in 2012?  Check.  No Republicans forced to vote for a tax increase?  Check.  No grand bargain?  Double check.  There’s plenty that I didn’t expect, though.

  1. Everyone—I mean everyone—glossed over the elimination of the payroll tax cut enacted two years ago.  People will see their take-home pay cut by two percent as a result, effective January 1, and they will blame someone.  Both sides knew that the payroll tax funding the Social Security trust had to revert to the ordinary rate, and I imagine that’s why neither side was interested in talking about it.  Does that mean no politician will run misleading ads in 2014 blaming his or her opponent for the decrease in take-home pay?  What do you think?
  2. The sequestration spending cuts were tabled for two months and will now be pulled into negotiations over an increase in the debt ceiling.  This is the worst part of the deal, in my opinion.  The President says he won’t negotiate over the debt ceiling.  Oh yeah?  If the sequestration had been addressed in this deal, he might have been able to hold that line.  It wasn’t, so he can’t.
  3. President Obama is right to want to avoid another round of negotiating, because he stinks at it.  The Republican caucus is disintegrating, the November elections strengthened the President’s Congressional support, and most importantly, he’s not running for reelection so he can (and should) ignore the polls and focus on principles.  Why doesn’t it feel like he did that?  I suspect that an increase in the bottom threshold for the top tax bracket was always part of his endgame, and I don’t have a problem with that.  What I have a problem with is drawing a line in the sand at $250,000, failing to hold that line, and not seeming to give a crap that the line didn’t hold.  It looks bad, and if Obama still doesn’t understand the theatrical aspects of his job, he should have stayed in Hawaii.
  4. The President didn’t come off as a tough guy, but compared to John Boehner, he might as well be Teddy Roosevelt.  The last two weeks could not have been uglier for poor Captain Orange.  His ‘Plan B’ was DOA; his chief deputy undercut him; he pissed of Chris Christie and everyone else in the Northeast; and he still had time to remind women how little he and his party care about their welfare.  And all that comes on top of Wayne LaPierre calling for a Howitzer in every school cafeteria.  No wonder Boehner was reduced to lobbing F-bombs at Harry Reid.
  5. Harry Reid is an all-time badass.
  6. Nancy Pelosi can keep her mouth shut, after all; I’m as impressed with her as I am with any of the major players (Harry Reid notwithstanding).
  7. Paul Ryan is definitely running for President in 2016.
  8. Everyone on CNBC hates this deal.  So I guess we know that the on-air personalities all get paid well in excess of $400K; producers and writers, too.
  9. The market was sick of the fiscal cliff, and not every trader and investor believed any kind of deal would get done.  Thus the Dow leapt higher by 200-plus points on Wednesday and held those gains.  What does that tell us?  (1) The market doesn’t care about the tax increases facing the wealthy, and (2) the ‘market experts’ on CNBC don’t care about anything but their tax bills.

This isn’t a great deal, and it was never going to be.  The Republican Party needs to figure out what it stands for before it will be in a position to work with Democrats to address the nation’s structural fiscal problems.  But if the far right hates the deal, and the far left hates the deal, it can’t be all bad.


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