U.S. Congress created this cliff and may now plunge off it

Comments (52)
Koolm wrote:

Why the “Fiscal Cliff” is so important and nobody mentioned before the election. What is going on government?

Nov 11, 2012 1:39am EST  --  Report as abuse
RSaltyDog wrote:

Poll after poll shows Americans want the Bush Tax Cuts to expire. Of course they will not put a huge dent into the deficit but it will make the majority of Americans feel that at least everyone is paying their fair share. The BTC were to make job creators and that hasn’t happened. The House 2010 promised jobs from these BTC creators and now almost 10 years later no results. These are not new taxes but were a temporary tax cut. Temporary…10+ years is more than temporary. I’m sure those in the House who signed the Norquist pledge are in a tough spot. For me, no BTC expire I will not vote for my Republican House member that has been there 15+ years.

Nov 11, 2012 1:41am EST  --  Report as abuse
ed.ross wrote:

I hope we go charging right over the edge of the cliff, leaving the Bush tax cuts in the refuse bin and sending military contractors to crack their whips on their GOP puppets, forcing them to bend over and take whatever terms Obama dictates in exchange for un-decreasing the military budget.

Nov 11, 2012 1:52am EST  --  Report as abuse

The United States government (Congress in particular) has become so corrupt that I believe the best thing that can happen to America is for the Federal government to go Bankrupt and disappear much like the Soviet Union.

Let the 50 State become sovereign nations. They certainly can’t do a much worse job running their own states than the Federal Government has done.

The Federal Government is a runaway locomotive that has gone over the (economic) cliff, hitting bottom, crashing and destroying itself is not in doubt is only a matter of when it hits bottom.

The Congress of the Unites State is gleefully doing what enemies of the state have been trying for year to accomplish; the destruction of The United State (or at least the Government of the United States)

Nov 11, 2012 1:57am EST  --  Report as abuse
Anne.onee.mus wrote:

What’s funny is… RSaltyDog says if the Bust Tax cuts don’t expire he won’t vote for a republican house member… why? Obama could have ended the Bush Tax Cuts in 2010… but instead, chose to sign an extension. In fact, Obama has continued many policies of Bush people wanted to see dropped, some of which he actually campaigned on saying he’d drop them. If you have a grudge about the Bush tax Cuts, hold it with Obama who promised to let them expire, but then signed an extension.

Nov 11, 2012 2:12am EST  --  Report as abuse
sgreco1970 wrote:

The election is over and Obama had a mandate (before you argue with me on that, as of today he won 332 to 206. That’s huge. Winning all but 1 of the swing states was massive.)

The republicaqns have dropped the anti-Obama act -if you aren’t experienced enough with politics to realize it was all just an election act. They have signaled their readiness to work with Obama and both sdies are bringing their requirements to the table.

No one will be plunging off any fiscal cliff. Give em a week and they’ll have it worked out -whether we like what any of them decide or not.

Let’s keep the “fiscal cliff” chicken littling to a minimum.

Nov 11, 2012 2:24am EST  --  Report as abuse
DeannaTx wrote:

It’s not alright for this Congress to allow America to go over the fiscal cliff. It’s not alright for anyone to be so beholding to a pledge other than their oath of office they would inflict such damage on our country.
They knew this was looming. Republicans in their out of touch with America thought they had the Presidency in the bag and as usual.. did nothing but sit on their hands saying no to everything which came before them.
I voted a split ticket. Obama for President and a Repubican for our House rep. The reason is a belief in a balanced government. I thought the House might be astute enough to pick up on the message. One more chance to get it together. I’m sorry now I didn’t vote a straight party ticket. I guarantee I will the next time and every time from then on.

Nov 11, 2012 2:33am EST  --  Report as abuse
captwasabi wrote:

Everyone calling for an end to the Bush Era Tax cuts are completely senile. Currently the wealthies 1% of Amercans earn just over 20% of all income in this country yet they pat 21.5% of all federal, state and local taxes.

This means that wealthy Americans are paying a share of taxes that is larger than their share of all income.

As for the ridiculous argument that “poll after poll shows Americans want the Bush Tax Cuts to expire” there is a reason this country was established as a REPRESENTATIVE democracy.

Or does RSaltyDog actually believe that if “poll after poll” showed Americans wanted slavery reinstated that we should follow suit?

Keep the tax cuts for EVERYBODY. The govt will simply need to cute back on it’s ridiculous entitlement programs which are not even part of it’s core funciton as set forth by the Constitution of the United States of America.

Nov 11, 2012 2:54am EST  --  Report as abuse
hungryforbeef wrote:

I would suggest that you get the government you
deserve in a democracy. You voted for corrupt
officials to squander your birth right and the
future of your children. I have observed the dire
warnings of various economists since the 70s.
Time to pay the piper. Time to raise taxes.
Time to pay your credit bills. Time to demand
European nations pony up their fair share in
support of the WWPF, World Wide Police Force.
‘mercans have been doing the worlds less savory
tasks for some time now. The World Democracies
need to pony up their fair share . . .

Nov 11, 2012 3:28am EST  --  Report as abuse
Reisel wrote:

Let the tax cuts expire….and claw back the capital gains tax rate.
What are the republicans going to do…waste another four years trying not to re-elect Obama?

We had an election…no pound dirt!

Nov 11, 2012 4:40am EST  --  Report as abuse
AZreb wrote:

Since the “fiscal cliff” is such an important item for all of us, please tell me why Obama is packing for an overseas trip and Biden is practicing for an appearance on a half-hour comedy show on TV. Seems like there are enough problems with our economy, the natural disaster in the NE, the “smaller” items like homelessness, joblessness, hunger and poverty in our country that would take ALL their time – shouldn’t they be working on those problems?

Nov 11, 2012 9:13am EST  --  Report as abuse
Ahilan wrote:

“Problems cannot be solved by the same level of thinking that created them.” – Albert Einstein

Nov 11, 2012 9:20am EST  --  Report as abuse
Whatsgoingon wrote:

When the tax cuts were introduced the word “growth” was used to fend off worries on “deficit”. In just a few years that word was not mentioned anywhere, and we are back to the zero-sum game of “who to tax” again. What has changed? If “tax the rich” was the true solution why did it take so long to be figured out?

Nov 11, 2012 10:02am EST  --  Report as abuse
letusdance wrote:

Need to get with the times and stop paying taxes like it’s the 1950′s

Nov 11, 2012 10:07am EST  --  Report as abuse
Doc62 wrote:

Lame duck is what the GOP has been for yrs. Compromise is the ONLY solution. We lose some, they lose some. President Obama learned this the hard way. Lofty goals won’t go over, so don’t blame him. Compromise is not a sellout or two faced.

Nov 11, 2012 10:54am EST  --  Report as abuse
speaker12 wrote:

My friends at Reuters, you just can’t stop. Tell the truth about Obama, no way, not you guys. By increasing the tax to the over $200,000 folks is chicken feed. The problem is Obama spending money we don’t have. You know it, I know it, but based on the recent election the American people don’t get it. Too bad……

Nov 11, 2012 11:02am EST  --  Report as abuse
Soapm wrote:

“Let the 50 State become sovereign nations. They certainly can’t do a much worse job running their own states than the Federal Government has done.”

We initially tried that with the articles of confederation and it was a miserable failure to the extent the constitution gave far more power to the Feds… Failure to whom you ask? Our founding fathers.

Nov 11, 2012 11:08am EST  --  Report as abuse
Soapm wrote:

“When the tax cuts were introduced the word “growth” was used to fend off worries on “deficit”. In just a few years that word was not mentioned anywhere, and we are back to the zero-sum game of “who to tax” again.”

It’s not mentioned because the growth never manifested but they’re using the word again to justify another round of tax cuts.

“What has changed? If “tax the rich” was the true solution why did it take so long to be figured out?”

Actually it was used both under FDR and more notably Eisenhower. Eisenhower made the top bracket 90% then gave generous deductions for investing in America. That was not only effective, it was the most economic growth we’ve ever had so much so that Kennedy had massive opposition when he dropped that top rate to 77%. And the nation grew economically then also…

Nov 11, 2012 11:13am EST  --  Report as abuse
Harry079 wrote:

The only ones that got REAL tax cuts(15% on Capital Gains) were the wealthy to begin with.

What the rest of us got was a 2% reduction on YOUR contributions to Social Security. Your pay in less you get less.

Most of us don’t realize there is a yearly cap on Social Security contributions that they keep right around the top end of the Union workers pay scale currently around $110,000.

The rich got a tax break from 38% to 15% on their Capital Gains which is nearly all the income of the Mitt Romneys and Warren Buffetts. They don’t pay any Social Security taxes on anything above the $110,000 cap on regular income.

So the wealthy got over a 100% reduction in Capital Gains taxes and we got a 33% reduction on what we pay into Social Security which will reduce the amount many will collect when the retire.

If the Government wants to raise revenue and relieve some of the pressure on the pays out more that it take in Social Security Trust Fund then all they have to do is REMOVE THE CAP on the contributions and let expire the 2% reduction on everyones elses wages.

Nov 11, 2012 11:14am EST  --  Report as abuse
Lloyd_L wrote:

Why aren’t we talking about comprehensive tax reform?

The highest earning 5% pay over 68% of the income taxes the government collects. As a group, it seems like they are paying their fair share. As a group, they are also paying the highest tax rate. What’s also true is that, within that group, there are some that pay little or no income tax.

At the same time, 47% of households pay no Federal income tax yet are free to vote for politicians who promise a never ending litany of public benefits to be paid for by “the other guy.” Surely there are some within that group that should be paying some income tax.

It seems to me that what is called for is a fairer and simpler tax system for everyone.

Nov 11, 2012 11:27am EST  --  Report as abuse
TrueWatchman wrote:

@Fred Barbash and Peter Cooney, writer and editors of this article. You refer to this as a fiscal cliff. Because everyone else does. There is no fiscal cliff. More like a fiscal curve…because even if Jan 1 2013 arrives, Congress can still do things to offset, alter and change the landscape after the deadline. Furthermore…

WRT, “But confidence is low”

According to Gallup, confidence is at its highest level since 2008.
http://www.gallup.com/poll/158429/economic-confidence-best-2008.aspx

Quit feeding into this invented “fiscal cliff” nightmare. No one is plunging and no one is going to crash and burn.

Shuffling promissory notes from one tax payer to another is hardly a crisis, hardly a cliff.

Nov 11, 2012 11:28am EST  --  Report as abuse
Marlboro wrote:

Let the tax cuts expire in their entirety. We will have more people with skin in the game and more people will begin to appreciate what confiscatory taxation is like. This will set the stage for the next election.

Nov 11, 2012 11:33am EST  --  Report as abuse
amacd wrote:

The guests and George intelligently discussing, debating, and informing Americans about the economic realities of the so-called ‘Fiscal Cliff’ on ABC were surprising — not so much from their outstanding lack of economic knowledge, but from a surprising truth offered accidentally by the young Republican Rep from Illinois, Aaron Schock when he proclaimed that the math doesn’t work and that taxing the rich will not solve the deficit problem, nor allow the investment in our future that all citizens and both parties want.

Yes, Aaron, “taxing” the rich (on their income) won’t solve the scare of the ‘Fiscal Cliff’ —– but the way to solve the ‘Fiscal Cliff’ and also fund education, investments, and both capital and human resources for our society’s future growth, health, and prosperity can be achieved through the simple step of ‘Wealth Reform’ — as similar to the proven success of ‘Land Reform’ in many countries whose asset (land) was being monopolized, horded, and taken out of constructive use by an entrenched and tiny (1%) elite of wealthy land owners.

In our country, the entrenched 1% elite have taken the wealth of the country, the commonwealth, out of constructive use and are holding and hording it (as even FOX and CNBC business talking heads admit, “There’s trillions on the sidelines”), and this essential and potentially ‘game changing’ opportunity for investment in human and other resources is being sequestered by a financially blocking elite who are only interested in being a unearned income, ‘rentier’ class — just as the landed elites were in many other crushed and stagnated countries.

So, Aaron, you are a genius (possibly without knowing it), by pointing out that taxing the income of the rich is not enough (since most is at low rates like carried interest already).

What Obama needs to do to unlock the potential for our country is to use a bold program of “Wealth Reform” — particularly since the US has the highest GINI Coefficient of Wealth Inequality (0.80) in the entire world, which will make the politics of such such a “Wealth Reform” – “Program for Progress” in the US very popular with 99% of the CITIZENS.

Even the Corporatist Media will have to report that Obama is
considering “Wealth Reform” to address the ‘Fiscal Cliff’
and hell, just raising the specter of “Wealth Reform” will
have the wealthy begging for any other solution.

Best luck and love to the fast expanding ‘Occupy
Empire’ educational and revolutionary movement against this deceitful, guileful, disguised EMPIRE, which doesn’t wear Red Coats, Red Stars, nor funny looking Nazi helmets.

Liberty, democracy, justice, and equality
Over
Violent/Vichy II
Empire,

Alan MacDonald
Sanford, Maine

Nov 11, 2012 11:55am EST  --  Report as abuse
xyz2055 wrote:

So let’s see how this works. Regardless of what the impact of these tax increase and spending cuts will cause, The House Republican’s and the White House agreed to these cuts (put them into law) if the “Super Committee” failed to find a measley $1.2T in spending cuts ($120B a year) over the next 10 years. Now they want to change the law. These guy’s credibility just simply couldn’t get much worse. They can’t even live into what THEY put into law. So which is it boys? Is it just political drama about how high the debt is and it’s really ok to keep on spending way more than we take in for the next several years? Or are these cuts what’s needed to stave off financial disaster?

Nov 11, 2012 1:02pm EST  --  Report as abuse
gangof4 wrote:

I can live with sequestration. The problem is, the Democrats with their appetite for deficit spending over domestic areas and the Republicans with their preference for military toys we cannot afford (assuming they continue to insist on denying government with the revenue to pay for these “toys”) cannot live with sequestration.

Returning Republicans to power in the House in a lesser number than before while the democratic control of the Senate with a pickup or two is hardly a mandate, Mr. Speaker.

Nov 11, 2012 1:04pm EST  --  Report as abuse
xyz2055 wrote:

The Bush Tax cuts and the Republican “job creator” stance simply couldn’t be larger BS. Taxes for EVERYONE in this country are at their historical lows. The 35% corporation tax rate is a myth..the U.S. Tax Code for the rich and Corporations has more “holes” than Albert Hall. (Beatles Rolling Stones reference). So where are the jobs? However, it seems to me that the bigger the tax breaks the larger the campaign contributions. Any chance of a correlation in that data?

Nov 11, 2012 1:13pm EST  --  Report as abuse
xyz2055 wrote:

gangof4..well said! Finally someone out there who gets it. The problems with this country aren’t just a Republican or a Democrat problem…it’s both of them. They have both contributed to the nightmare and each one blames the other. If it were up to me.I would change the Constitution so that neither political party could ever have a major control of the government. But that each was represented equally and that the mandate was to work together to fix the problems.

Nov 11, 2012 1:39pm EST  --  Report as abuse
NLC wrote:

This fiscal cliff is likely to be another Y2K. No need to panic.

Nov 11, 2012 2:40pm EST  --  Report as abuse
NLC wrote:

This fiscal cliff is likely to be another Y2K. No need to panic.

Nov 11, 2012 2:40pm EST  --  Report as abuse
NLC wrote:

Another Y2K. Mass hysteria. Big whoop. Nothing much will change.

Nov 11, 2012 2:46pm EST  --  Report as abuse
Robert76 wrote:

well said xyz2055. Let’s see to it that neither Party can ever have a majority stake in the Senate and House. Further these career Politicians need to be limited to 6 Yrs. We need to do away with their lifetime pensions earned after 6 years service.

We need a flat tax at a fair rate with absolutely no loopholes, and money hidden in off shore accounts needs to be taxed the same as money held in this country. Why should working people be paying taxes in the 18 – 28% bracket and have millionaires paying between nothing and 13.9% that Romney paid.

It is time for fairness in our taxes.

Nov 11, 2012 2:56pm EST  --  Report as abuse
drmorocco wrote:

Lets eliminate all foreign aid. All, every single country, no exceptions.

Nov 11, 2012 4:17pm EST  --  Report as abuse
xyz2055 wrote:

Thanks Robert76..there are a few of us left that aren’t registered Republicans or Democrats and aren’t shackled in bondage to carry the party line..

Nov 11, 2012 5:21pm EST  --  Report as abuse
LTR wrote:

Tax loopholes, Crony Capitalism, farming jobs out in the name of Capatilism, Bains Chop Shop… the average person is no longer fooled by the K.Rove BS factory… start paying your fair share or be dragged out into the streets. People do not have any patience for crap anymore.

Nov 11, 2012 5:28pm EST  --  Report as abuse
kevin2ia wrote:

1. It is a certainty that congress created this, since the doing nothing president has done nothing. 2. To think that BO will offer anything new is naive, ludicrous and just plain stupid – he is incapable of such an act. 3. $850B over 10 years – we need that much in 1 year. Why regurgitate the crap that the federal government pukes up?

Nov 11, 2012 7:31pm EST  --  Report as abuse
Vilavicki wrote:

Jim Cramer was on MSNBC where he said that the business community wants this Congress made crisis solved and fast. They do not want this dragged out causing uncertainty. This is good news since, if no one else, the GOP does care about the business community. Republicans have shown for a long time that their hearts belong to the one percent. The tea party is made up of middle class Fox viewers and very misinformed people.

Nov 11, 2012 7:35pm EST  --  Report as abuse
Vilavicki wrote:

You would know about the fiscal cliff if you had watched something other than whatever you were watching. On MSNBC they talked often about this Congress made debacle. Republicans also caused the downgrading of the U.S. credit rating when they refused to raise the debt limit.

Nov 11, 2012 7:43pm EST  --  Report as abuse
joe10082 wrote:

Both parties have their backs to the wall. They know if they don’t work together to reach an acceptable compromise that the economy will get much much worse for the average American in 2013. It would take years to recover from the aftershocks to the economy owing to draconian cuts that would otherwise go into effect.This is the one kind of situation that will actually force politicians of both parties to work together.

Nov 11, 2012 7:54pm EST  --  Report as abuse
edgyinchina wrote:

It just shows that we are one step closer to being a third-world nation…. Or we may not be ‘One Nation’ much longer….

Nov 11, 2012 8:57pm EST  --  Report as abuse
ConstFundie wrote:

@Lloyed, Let’s talk about “fair”. The top 5% have 72% of ALL Financial wealth in this nation, and 63% of ALL Net Worth. The bottom 80% have 5% of Financial wealth and 11% of ALL net worth. THE BOTTOM 80%!? The bottom 50% less than 1%, and probably less than 0.5% of financial wealth. Is that fair? http://www2.ucsc.edu/whorulesamerica/power/wealth.html

Do you realize that Republicans Maintained control of the House? Key word MAINTAINED since 2010, and doing the same job as they did the last two years of spending money with the best of them? This is how the game is played: ‘Hey you spend Public money on my thing in my State to my friends and I’ll go along with spending Public money on that thing in your state to your friend’s (er..constituents, wink). Everyone’s happy!’

That is called “Reaching across the aisle”, and is how the top 0.1% end up with benefiting most from Public money expenditures at the next quartile’s (24.9%), and the Nation’s, expense. That is why no party wants to stop spending. All that money spent by the RICH and the Pacs in the election was Investment money, not gift. And the expected, ( demanded) ‘return’ will come from Public money and resources, and legislative advantage and benefits.

Nov 11, 2012 8:57pm EST  --  Report as abuse
JohnnyRacer wrote:

GOP acting like domestic terrorists. Scorched earth policy all the way in SPITE of the fact that the electorate sent a clear endorsement of Obama’s approach. It will be a LONG time before I vote GOP again, if ever…..

Nov 12, 2012 6:27am EST  --  Report as abuse
pbgd wrote:

Since Congress created the cliff, Congress can also remove or alter it.

Nov 12, 2012 7:00am EST  --  Report as abuse
CuriousOne wrote:

“We the People of the United States, in Order to form a more perfect Union…”

Can someone please tell the Republican party they lost, again?

Nov 12, 2012 7:17am EST  --  Report as abuse
GA_Chris wrote:

It’s easy… just suspend pay for all of congress and their aides… it won’t save a lot of money, but will drive the right approach

Nov 12, 2012 8:32am EST  --  Report as abuse
Lloyd_L wrote:

@ConstFundie
You raise a few issues. Please allow me to respond;

You point out that both parties like to spend money. I agree. The national debt has nearly tripled in the last 12 years. That out of control spending has us headed toward a real fiscal cliff as opposed to this little that is now in the news. As Robert Rubin (Bill Clinton’s former Treasury Secretary) points out, “We have an unsustainable fiscal trajectory. We have a dangerous fiscal trajectory.” We, as a country, cannot continue to borrow 35 cents of every dollar we spend. Here is a link to the interview with Robert Rubin that I refer to and hope you will take a few minutes to watch it. I think everyone needs to understand the pitfalls of failing to deal with our spending problem;
http://www.youtube.com/watch?v=XGTmzKOcAkI

You also point to a study on the distribution of wealth and power in this country though I am not sure of your point in raising this issue. Are you suggesting that we should be taxing wealth (some measure of net worth) as opposed to taxing income? If so, then I would have to hear how you think such a concept can be implemented.

If you are suggesting that that powerful interests (large corporations and labor unions plus a few very wealthy individuals) have undue influence in our political system, then I would agree with that. It’s called crony capitalism and describes an economic system in which powerful businesses and unions use government to gain an advantage over small businesses and the people who work for those small businesses. Our banking system is a good example of an industry dominated by crony capitalists. However, we may not agree on the solution.

Finally, one point I would make about the study you cite is that it is deeply flawed in that it does not view the value of pensions as wealth. Let me give this example. Two retired couples each have $75,000 of income. The first couple derives all of their income from rental properties with a value of $1,500,000. The second couple’s retirement comes from a pension plan. Your study defines wealth “in terms or marketable assets.” That would exclude the value of employer paid defined benefit plans (almost all public employee plans and at least a good share of private employee plans). In doing that, it would make the second couple appear to have no wealth and thus overstate the wealth of the rest of the group in terms of percentages.

That is a lot of wealth to ignore when trying to relate wealth to power. For instance, labor unions in California own the California legislature. California has a terribly underfunded public pension system. Labor unions have effectively blocked fundamental change to the system. That’s a lot of power for a group that has practically no wealth in the eyes of your study.

Nov 12, 2012 8:42am EST  --  Report as abuse
SanPa wrote:

Why the GOP held the House is beyond me, but that they hold power means that they will have to be a partner, or be eradicated in the next election.

Nov 12, 2012 8:54am EST  --  Report as abuse
5485 wrote:

After the wars and the banks ruined our Nation, sooner or later we have to bit the bullet, and it’s going to be painful

Nov 12, 2012 9:03am EST  --  Report as abuse
jaham wrote:

Unfortunately, Obama and the Dems appear incapable of making the intellectual distinction between attempting to raise revenues via higher nominal rates and deterring business investment vs. raising revenues by lowering rates and removing deductions via pro-growth tax reform.

If they cannot comprehend this simple distinction then I have little hope for compromise; a four year lame duck session where Bernanke, by necessity, keeps the proverbial pedal to the metal.

Nov 12, 2012 9:48am EST  --  Report as abuse
jaham wrote:

Don’t worry: Obama vowed during the debates that the fiscal cliff “will not happen”.

If he sticks to that promise as closely as he did his vow to halve the budget deficit in his first term, everything will be just dandy…

Nov 12, 2012 10:02am EST  --  Report as abuse
jaham wrote:

@SanPa said: “Why the GOP held the House is beyond me, but that they hold power means that they will have to be a partner, or be eradicated in the next election.”

The GOP took the House in 2010 by will of the people who wanted Obama obstructed after he forced through PPACA without a single GOP vote, and then turned around to feign interest in “compromise”.

Thus, the GOP took the House and obstructed Obama’s boneheaded policies from 2010-2012. After that 2 year stint, the American people just re-elected them, extended their House majority, and emboldened them in their cause…

They weren’t “erdaicated” in this election; what makes you think that Americans will feel any different after this next two years?

Nov 12, 2012 10:34am EST  --  Report as abuse
Mott wrote:

Polarization at it’s best.

Same old deadlock.

It’s a myth that tax breaks creates jobs in US as well as it’s a myth that tax increases result in job losses – as in both cases, the jobs are being created/lost in China.

The self correction needs to come from value-added-taxes on all imports to work-around this gridlocked system.

Short of that, it’s the usual soap opera for another 4 years while the rest needs to start praying.

Nov 12, 2012 11:01am EST  --  Report as abuse
jaham wrote:

Obama’s plan to tax the rich is a farce:

The centerpiece of President Obama’s plan is to raise taxes on the rich (households making $250.000 or more). The only problem with this “solution” is that it is dishonest. President Obama likes to give the impression that his plan to tax the rich can significantly reduce the deficit, a claim which is false and which Obama knows is false.

Everybody knows that the rich have a lot of money, so it may appear reasonable to non-economists that taking some this wealth can fill the hole in the budget. What the public doesn’t know, and what President Obama will not tell them, is that there are just too few rich people in America for this plan to work.

According to the CBO, over the next 10 years the Obama budget will produce a deficit of $10.900 billion, or 5.3% of GDP on average.

According to the left’s own calculations, Obama’s plan to raise taxes on the rich will generate $700 billion in additional revenue over the next decade, or just a pathetic 0.3% of GDP.

In other words, the plan to raise taxes on the rich will only cover one out of fifteen dollars of deficit spending. Where is President Obama going to get the other fourteen out of fifteen?

To the $10.9 trillion in deficits we need to add the unfunded liabilities of Medicare and Social Security. According to the Trustees of these programs, the unfounded liabilities are a staggering $52 trillion.

Again, any honest economist who knows the facts can tell you that a measly $70 billion in revenue per year from the rich will not come close to cover America’s fiscal hole of at least $63000 billion dollars.

Nov 12, 2012 3:54pm EST  --  Report as abuse
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