Economy · Politics/Government

What do you think of the deal to stop the country’s fall off the fiscal cliff?

Eric Ringham Jan 1, 2013
55

The fiscal deal approved late Tuesday night allows income taxes to rise for individuals earning over $400,000 and couples making more than $450,000. It avoids the major spending cuts and widespread tax increases known as the “fiscal cliff.” Today’s Question: What do you think of the deal to stop the country’s fall off the fiscal cliff?

  • Clark

    Obama has spent $5.2 trillion in excess of revenues the past four years so this deal solves nothing in terms of deficit. Punish success, reward failure. Democrats do not want to pay the true cost of big government since the middle class would no longer support obama spending. We have a spending problem not a tax problem. Spending now 24% of GDP, highest since 1946. Obama is not a leader and he remains math challenged.

    • Steve the Cynic

      Your tiresome rants only make sense if you define success solely in terms of how much profit you’re able to extract from the economy, without regard to whether your activities actually make the world a better place. Because wide wealth disparities tend to reduce average happiness, progressive taxation improves national well-being.

      • Clark

        Steve the clueless

        I rant as I actually understand macro economics and realize we can’t afford to carry the moocher class. It will truly be our kids and grandkids left with the debt. I repeat again for the math challenged, there are not enough high income to solve obama’s spending problem.

        • GregX

          in your model -the biggest moocher class IS the private sector businesses.

          When you give the poor a dollar – they spend it. and the private sector takes it.

          as for you math … once again you suffer from the conservative logic error … mis-stating the actual problem.

          the liberal contention is that taxing the wealthy IS A PART of the solution. a Revenue stream that will exist reliably for decades – without depleting their ability to survive.

          It is inane to assume , as you incorrectly parrot, that it is the entire “liberal” revenue solution.

        • Steve the Cynic

          It may surprise you to know that I actually do understand macroeconomic theory, and it provides some useful insights for policy making. It’s just that I do not consider macroeconomic theory adequate, by itself, either for explaning human behavior or for solving the real problems the world faces.
          You seem to think the economy would provide more human well-being if we let it function like a jungle. I think it would work better for us if we treat it like a farm.

  • Scott

    I have read that as part of the deal every ones taxes will go up 2%. While this may help in paying our debt, it’s not enough. Everybody benefits from the F.D.A., C.D.C., Border Protection,F.B.I. Etc.,Etc.,
    But nobody really wants to pay for it. We want the other guy to pay for it. If you make $5,000 or $5 million a year everyone needs to kick in more

  • Duane

    The deal is only half finished, they still the need to attack the spending problem, and that is supposed to happen in the next two months. Under the leadership of this President, I don’t expect that to happen. He has accomplished his goal which was to increase the revenue to cover the excessive spending that he fails to recognize is the real problem. President Obama will go down as one of the most inept presidents elected in recent times unless he is able to turn the economy around…and nothing in this bill will achieve that.

  • Steve the Cynic

    I was secretly hoping there would be no deal at all. Our national soul would benefit from another Great Depression. It would help wean us from our idolatrous pursuit of financial prosperity so we could consider what would actually make us happier.

  • Emery

    Congressman Paul Ryan’s proposed budget (“The path to prosperity”) would
    not end deficits until 2040 and would have added an additional $5.4
    trillion to the deficit.

  • Gary F

    Don’t expect our economy to get any better any time soon. America will just put it’s wallet back in its pocket and only take it for necessities.

    When there is wailing and gnashing of teeth when government gets less of an increase than last year(a.k.a. “drastic cuts”), there is little hope that this mess with ever be saved.

    Time for us all to read Thomas Sowell’s “The Dismantling of America”.

  • Gary F

    Don’t expect our economy to get any better any time soon. America will just put it’s wallet back in its pocket and only take it OUT for necessities.

    When there is wailing and gnashing of teeth when government gets less of an increase than last year(a.k.a. “drastic cuts”), there is little hope that this mess with ever be saved.

    Time for us all to read Thomas Sowell’s “The Dismantling of America”.

    • GregX

      Thomas Sowell is a fine weatherman – he can tell you what observably happened yesterday (in case you were in a coma) – but his explanations for “why” are based on his predilection towards excluding any and all contrary data – and statically adhering to his reductionist analysis process to do so. This inability to rationally accept or account for all factors means that his analytic model mis-classifies many outcomes and that his predictive model grossly overstates certain outcomes – especially those regarding markets dynamics.

  • Rich in Duluth

    I’m disappointed in the agreement. I think the President gave up way too much by allowing the tax breaks to remain for those making less than $400,000. Frankly, I, too, was hoping we’d go over the “cliff” and taxes, across the board, would go back up. We should pay our debts and that means paying more taxes.

    Sadly, the poor and elderly will now have to shoulder the debt, by cuts to Medicare and Social Security. I think the Republicans now have the leverage they need to protect big business, the financial “industry” and the military.

    • Jeff

      Here’s a quote from a recent David Brooks column: “The average Medicare couple pays $109,000 into the program and gets $343,000 in benefits out, according to the Urban Institute. This is $234,000 in free money.” How can you suggest that the elderly are shouldering the debt if we discuss some sort of control on that type of spending? Nope we are simply saving the SS and Medicare programs by making sure they don’t go bankrupt in the next decade or two.

      • georges

        The $109,000 the couple pays in….is the actual dollars they pay into the system over nearly a half century……..and completely ignores the modern miracle know as “compound interest”.
        Therefore, they are losing money….not getting any “free money” whatsoever.
        Word

        • Jeff

          If only that’s how the system worked, if we had some sort of privatized SS or Medicare system where you could put your investment dollars into private sector funds then you could make that case. What really happens is that the costs for those programs are paid first by all the taxes taken in today; anything left over is put into Treasury Bills which pay less than 1% today. Are you arguing for privatization or are you simply mad that the government doesn’t invest your money intelligently? You cannot argue that there is more money there than they put in since almost all the money today is simply going strait out the door to pay current benefactors.

          • georges

            I am pointing out the fallacious nature of the common idea that senior citizens soon get back all they paid in and then are getting “free money” from the government.

            Nothing could be further from the truth.

            Indeed, if one starts working at 18, pays in for 47 years and then retires, he cannot possibly live long enough to get back what he paid in.

            You can’t figure like that (dollar for dollar) over the span of decades. Not only does it not account for compound interest, but also ignores inflation. 47 years ago, you could by a new Ford Mustang for $2,000……now, it’s about $24,000……..a factor of 12 times.

            Therefore, those dollars the elderly are getting back, dollar for dollar, are worth less than the dollars they paid in, with some of those dollars being worth only 8 cents.

            As to the money going straight out to pay current retirees, that idea is meaningless. The FedGov always has plenty of cash. They own the printing presses, you know. Which makes those old dollars worth even less.

  • kevins

    My rep (peterson) voted against the bill, predictable as he is. BTW, since when are the Dems solely to blame for spending issues? Can you name a republican admin. in the last 50 years that has reduced the size of government? I think it would be refreshing if those so focused on spending cuts would actually specify what they want to cut, or which elements of the tax code they would recommend changing. Then all could see which ox will be gored, and folks could rationally debate the merits. Because poor and handicapped people are still easy targets, we could also talk about the character of our culture.

  • John

    It was a complete distraction from the 48 trillion debt.

    There was nothing done about the military spending, the 900 overseas, in 130 countries, military bases. The Waring that this country is promoting daily.

    Cutting Homeland Security, TSA, aid to Israel, domestic drone program, and military training for domestic police.

    Nothing done about the free money the Banksters are getting from the zero interest rate Federal Reserve, that is totally destroying the middle income earners savings account. The real rate will change when inflation takes off, which it already has but they don’t report in the mainstream medial or include food and fuel as part of the calculation of inflation.

    Its just a scam.

  • GregX

    It was the predictable bail .. by all parties involved.

    goal #1 – save face.

    goal #2 – leave credible space for renegging in future months.

    goal #3 – hang this doody on the exiting congress

    I’m am a liberal but I don’t care for the size nor continuation of the debt. In very simplistic terms … America OWES so …

    #1 — the increase of revenue dedicated to paying down debt is valid

    #2 – the increase of efficiency and effectiveness in delivering programs can and must be increased. we spend a lot administering separate but equal programs.

    #3 – Spending isn’t the problem… its a symptom of the problem. The problem is thinking everything needs to be solved by infusions of money. The public funds – big-Agriculture, Big-Chemical, Big-Energy, as well as BIGGEST-MIlitary and BIG-SOCIAL. We wouldn’t have to create new programs if we re-wrote the laws that force people to spend money – and thus requires that we provide it to them.

  • Bill

    The fiscal cliff was not something the country would fall off…it was just some scenery on our journey. And there will be many more sights and milestones upcoming in our journey, so this one came and we oohed and aahed at how big the cliff was. I’m not sure if we were looking down at it like the Grand Canyon, or up at it like Mount Rushmore. But now its time to keep our eyes open for the next bit of scenery to ooh and aah at.

  • Jim G

    There was no stomach yet on either side for a more comprehensive deal. That means kicking most of the issues down the road a couple of months. Congress and the President will need to go back again on the debt ceiling and entitlement reform. Our financial problems are not going to be solved by any one piece of legislation. This was Round 1 of a 10 Round fight whose goal should be putting this country back on the road to fair and sustainable economic policies for all classes, not just the wealthiest, as it has been the case for the last thirty years.

  • Paul

    There aren’t enough life boats – move the deck chairs around as much as you want.

  • Cat

    We have to start somewhere, and get Congress to agree to something that will limit pain to the most vulnerable while increasing revenues. It may take numerous incremental steps like this deal to get compromise into the “muscle memory” of today’s Congress. Is it a good deal? No, but it is a good first step. My fear is that the Democrats’ negotiating position on the next step (spending cuts) has been weakened, but I don’t know what better alternative could have been achieved. Both sides compromised.

  • georges

    You gotta love it everytime a liberal says we don’t have a spending problem.
    That’s the same as saying the fat girl who is 5′ 2″ and weighs 430 pounds doesn’t have an eating problem.
    She has…..ahhhhh……..a revenue problem. She needs more money coming in…..so she can buy more food……and, you know……..eat it.

    • Greg

      I’m confused… your example seems to be conservative in all respects.

      Keeps all food for itself. Consumes all food for itself. Eats most of the food when it is provided.

      Check, check , check. Yup conservative values (all for ones self) !!!

      this is an interesting insight into your true self.

      • georges

        You are confused…..as usual.

        The example shows how liberals lie to themselves, and the Nation, that we don’t have a FedGov spending problem when, of course, that is exactly what we have, just as the fat girl has an obvious eating problem, and both are unwilling to stop the problem they are so addicted to (spending/eating).

        Please make at least a rudimentary attempt at understanding the meaning of words. It is important to the ability to hold a coherent conversation.

        I suggest you study my posts on the National Debt compared to the GDP, current and future, on these pages in recent days. If you can understand simple mathematics, and are able to overcome your enslavement to the Democrat Party, you will learn what the problem is and how to deal with it.

        Enjoy………

        • GregX

          wrong again…
          but … not a surprise.

          words arranged in faulty logic, argument and corollary are worthless.

          your score today “0.00000000”

          • georges

            Awwwwwwww………..So cute……..

            ………to see a minor leaguer try to jump to the Bigs……….

            Go back to D league. Get the basics down. Then maybe to A. Then AA. Then try Triple A Ball.

            If you can be coherent there, then come back and try again.

          • Steve the Cynic

            In case you hadn’t noticed, jockamo/georges, this is the D league. No one is paid, and anyone who wants to can play (as evidenced by your participation).

  • Steve

    The vast majority of the population has absolutely no representation anymore…to say that 400K or even 250K is the point at which an individual is considered wealthy today proves the point that both (elected) Repub’s & Dem’s alike are absolutely in a world of their own. It doesn’t matter what is approved in respect to higher income earners because only donors & self interest have the last say, so there will always be the loopholes to protect them…unfortunately history has proven this time and again. Self employed sm business owner & parent of child w/disabilities a Republican no more & not a Democrat…tired of the posturing…tired of the vitriol…just plain tired.

  • Ryan

    I don’t think the American people are as selfish as our representatives think. If debt and deficits will eat us alive, I am willing to sacrifice and I get the impression others are too as long as the sacrifice is done fairly. This doesn’t decision doesn’t seem like much to me – it feels like the easiest solution possible.

  • MLewis

    When does the can get so big that we break our foot trying to kick it?

    • jockamo

      The “can” is already that big. Trouble is, those we have hired to kick the can are wearing cast iron overshoes.

  • Ann M

    Taxes are being increased on people like lawyers who can just pass along those increased costs by charging you more.They can also adjust their charitable giving and the number of people they employ. Increasing taxes on investments affects people like the elderly who are trying to live on fixed incomes.The taxpayers pay the people who are employed in the public sector. Our leaders need to do what Germany did: work with companies and unions to get more jobs and to get people into the right jobs.If something isn’t done, there will be many fiscal cliffs.

    • georges

      We need to do what Canada did.
      Lower the corporate income tax……..twice.
      And, establish a conservative government…..relegating the last couple of liberals to a bench so far back they need binoculars to see what is going on.

      • Steve the Cynic

        I think corporations should be forbidden from paying income taxes, as if they were people. That they pay taxes at all is a mere fiction, since they pass those costs on to their customers through higher prices and employees through lower wages. They should pay real estate and other taxes that pay for the infrastructure and services they depend on, but only actual human beings should be accorded the rights and duties of citizenship.

  • Pearly

    Can we call them the “Obama tax breaks” now?

  • David P.

    If a picture tells 1,000 words, you might find this from Forbes magazine of interest (www.forbes.com/sites/rickungar/2012/05/24/who-is-the-smallest-government-spender-since-eisenhower-would-you-believe-its-barack-obama/)

    Please – a proposed New Year’s resolution – to consider
    information critically, understand its source, bias and nuanced meaning before proclaiming it to be an indisputable fact.

    Now, back to TQ. Until we are willing to address the gluttony of the military/industrial complex and 1% club as well as the ongoing pillaging of the America’s working class, asking the hungry to help feed the obese and asking the obese to limit themselves to only 2 trips through the buffet line isn’t going to solve the problem.

  • Shane

    I think every elected official involved in this deal should feel ashamed of themselves, especially the president. It took this long and we had to put up with all that nonsense and this is the deal we get? Taxes go up on everybody and no cuts in spending. What a joke.

  • Jeff

    kevins – [BTW, since when are the Dems solely to blame for spending issues? Can you name a republican admin. in the last 50 years that has reduced the size of government?] *** Yes, his name was Eisenhower! The Democrats enacted most of the social programs which make up around 60% of federal budget. Ask a Democrat about cutting spending and the only thing they can come up with is defense…which makes up about 20% of the federal budget…fine let’s cut defense but let’s also cut social spending by 3 times that amount…if they had intellectual honesty they would have to agree to that type of a deal.

    • kevins

      Great..let’s resurrect DDE, along with the old Republican party. BTW, was that within 50 years as I proposed? Also, go ahead and detail specific cuts in social programs, with emphasis on the ‘specific’, and then we can talk. Otherwise you do little to advance any sensible discussion of productive change, besides the head-banging partisanship we have now.

      • Jeff

        Sure, here are the specifics on SS, allow the cap to increase to about $150k/year; allow the age for benefits to increase by 2 years over 2 decades for people who are 55 and younger today and base inflation on CPI instead of the salary index…If you do those 3 minor things SS will be solvent for about 75-100 years.

        Cut defense spending by about 5% for the next 10 years and get the military to be more mobile and massively reduce the size (number of soldiers) of the military while investing much more in aircraft systems and drone type of aircraft. Pay soldiers more while they are fighting and less after the fact (of course cover medical issues incurred by military duty), reduce future pensions for those not in the military yet.

        Reform the tax code to make it more uniform, protect the poor, remain progressive and remove special interests. Doing something strait forward like eliminating all tax credits and tax breaks while creating a uniform tax deduction of about $20k/year. After that deduction all income should be taxed at 20% and to maintain progressiveness there should be another tax bracket of 25% on income above $250k/year. This will increase revenue and boost the economy while protecting the poor and eliminating special interests.

        Other federal programs need to be cut across the board, we are simply spending too much as a percentage of our GDP. Even under G W Bush we spent less than 20% of GDP (as an average over 8 years), currently Obama has been averaging about 24% of GDP for his first 4 years. Spending is the major reason for the debt but yes we need more revenue (as I indicated with the tax reform plan).

        • kevins

          Thanks for the response and I agree with you on many points. My original point however was that blaming Obama for current economic conditions is intellectually and factually dishonest. I also find that lawmakers have difficulty with the specifics, at least publicly, and the tea bag folks complain about spending but can never be pinned down on the details. As for GW’s 20% of GDP, he wrote checks that had to be paid for later. I always wonder how votes on defense spending would have gone if the expenses had actually been on budget. And the math on Eisenhower still makes his admin more than 50 years old.

  • Diana

    Disgusting. Unfortunately not a big surprise.
    When one group makes promises to big donors, plus absolutes….

  • Linda in Plymouth

    The bill to spend for storm Sandy is a good example_ the Democrat Senate adds in more pork to favor thier agenda, all at the expense of the really desperate storm victims; e.g. $ 600 million for non storm victim help. Once again Senate Leader Harry Reid acts like a dictator, just as they they all say Pelsoi used to act with a fist. Reid has not allowed one vote for the past 4 years to do as law requires_ PASS a GD BUDGET! and stick to it. Reid refused to allow a Senate VOTE on 30 ecomonic bills passed in the House.

    The Dems are the true Party of NO. Period_ facts show this.

    Now we have 77% of all workers getting a tax hike of 2% for payroll taxes. Obama refuses to take responsibility for his wasted stimulus $ used instead to aid Unions and big banks, nor does he take responsibility for all the wasted billions of stimulus money for his GD useless Green Energy. Do we not get it? Solar power costs 4 x what oil and gas costs for the same kilowat of electricty. Ooppps, I forgot_ Obama pledged that under his admin. electircity costs ” will necessarily SKY rocket” He is on his way to becoming the worst President since Woodrow Wilson…only a total wuss would have allowed our spy drone to be left in Iran’s hands and to leave our stealth technology to be grabbed by China when the helo crashed while getting bin Laden. He refuses to be a leader- just an ideolog wanna be dictator while he wastes millions on his vacations and expects us to do as he says, but not as he does. The stock market will rally with this new bill for awhile_ then our credit will fall once more again (the SECOND time in history AND BOTH while under Obama’s rule) then the dollar will soon be worth another 25% LESS., the BOND MARKET bubble will burst_ because countries won’t buy our bonds and our pensions and retirement accounts will suffer, and all this for the Progressives deal?
    Why is it that only the American Communist Party, The National Socialist Party and their affiliate millionaire Union leaders openly endorse Obama? Get a clue MN. You voted for this ideology that is nothing but a slow spiral down to medocrity so everyone is the same- and everyone becomes much poorer.

    • Steve the Cynic

      Bovine feces!

    • kevins

      Cat poo!

    • georges

      Way to go, Linda……
      You got 2 of the ultra-libs to choke on, and spit out, their favorite dinners…….
      HarHarHar

      • Steve the Cynic

        I’m an “ultra-lib”? That’s news to me. I voted for both Reagan and Papa Bush. My views haven’t changed much since then, but now I’m “ultra-lib”? No, georges/jockamo, what really happened is that conservatives like you kept marching in lockstep farther and farther right, so that from your perspective we sensible centrists only appear liberal. Back in the day, we used to make fun of the John Birchers, secure in the knowledge that hardly anyone took that radical fringe seriously (when, for instance, they accused Eisenhower of being a pawn of the Communists). These days, folks of that ilk are running the GOP, and Democrats like Clinton and Obama rushed in to fill the vacuum in the middle.

        • georges

          Of course it is news to you.
          Being immature in thought, you are controlled by your feelings. Your feelings want you to be able to think of yourself as a rational, responsible, middle-of-the-road sort of guy, so your brain makes sure you think of yourself in that way, no matter how extreme your ideas really are.
          I, on the other hand, am not at all bound by your feelings. Therefore, I can see you as you actually are, instead of how you desire to be perceived. The extremism of your posts is not in question, or up for debate, for those of us who can see clearly, objectively, not blinded by your feelings.
          Add to that my genetic abilities and drive to arrive at the objective truth in any matter that comes before me, you will see that it is in your best interests to leave the judgement of what you are to me. That way, the proper and accurate evaluation will be easily found.
          Don’t be too hard on your brain. It is only doing its primary duty of protecting your feelings. When your feelings mature, so will your brain follow close behind.
          In the meantime, just accept the fact that you are an ultra-liberal extremist.

          • Steve the Cynic

            That comment is so full of post-digestive cattle feed I can smell it over the internet.

    • GregX

      that was like watching a dog chase its tail.
      pretty happy when you catch it.
      OW.

  • Cy

    Last I checked the rich are still rich and getting richer. Just as it has always been and always will be. Whatever is lost or gained, by one group or another, the very wealthy always come out on top. That’s why they contribute to both parties. Maintaining the appearance of balanced, opposing forces is good for their business.

    So I hope everyone enjoyed our government’s little Punch and Judy show.

  • CarlS

    Obama “promised” to not raise taxes on the middle class. But he did allow the payroll tax break to expire, thus effectively raising taxes on the middle class.

    But not to foist this all on Obama, it did have bipartisan support. At least this deflates both the democrat haters and the republican haters with yet another example of how both parties are not different from each other.