Cliff notes

By Tom Cardella

Add Comment Add Comment | Comments: 1 | Posted Jan. 10, 2013

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So how did you enjoy the ride over the fiscal cliff? Admit it, we were all scared until our parachutes opened. There are several reasons why the overall deal is a good thing. 

You’ll forgive me if I don’t get too specific because I don’t want you nodding off on me and missing the rest of “The Real Housewives of Atlanta.” Also, only a member of Congress understands all of the gory details, and perhaps the only redeeming quality of your columnist is that he is not a member of Congress. 

The Republican-controlled House of Representatives is slightly less popular than genital itch. If this fiscal cliff deal did anything, it helped to isolate the crazies on the right. New Jersey Republican Gov. Chris Christie blasted members of his own party as being shameless for failing to sign off on aid to the victims of Hurricane Sandy. First, Christie pals around with President Barack Obama, then he calls out Republicans in the House. What’s next for Christie, keynote speaker at the next Democratic Convention? New York U.S. Rep. Peter King, also a Republican, joined in on hammering his own colleagues in the House. I believe what we are witnessing is the first step in a 12-step-recovery program for the Republican Party.

Back to the deal: While liberals and conservatives seemed equally ticked off at the compromise, here’s why I like it. We wound up with more progressive taxes. Yes, Gertrude, Republicans actually voted for a tax increase. Take that, Grover Norquist. It’s not perfect. Obama wanted a modest increase in the tax rates on folks earning over $250,000 a year. Republicans wanted no such increase whatsoever, preferring to cut Medicare and Social Security for the rest of us. They wound up voting for an increase on people making over $450,000 a year. I call that progress.

The deal also raised taxes on capital gains and estate taxes, the tax Republicans ominously refer to as the “death tax.” Unemployment benefits were extended for the all too many who are still out of work. All in all, the deal allows revenue to increase by $620 billion, not the $1 trillion the president wanted, but that’s why they call it a compromise. To claim, as some on the left do, that it would have been better to have no deal at all, I say reducing the deficit by $620 billion without committing to the kind of draconian cuts in social programs favored by Tea Party types is, by definition, better than no deal at all. Compromise is not a synonym for “weak” as some would have you believe. Compromise is making our political system work.

I am not entirely happy by any means. Congress failed to extend the cut in payroll taxes, so my friend, as a worker you just got yourself a 2 percent decrease in your take-home pay. True, the payroll tax cut was supposed to be temporary, but the reasons why the temporary cut was enacted in the first place are still evident. The economy is lousy and you want ordinary folks to have more take-home pay so they can spend more and pump up the sagging economy. 

Conservatives say that the increased payroll taxes are needed to fund Social Security. Beware of conservatives who claim they want to save Social Security just as you have to watch out for Greeks bearing gifts (or is that now politically incorrect?). Repeat after me: Social Security is on a sound footing for the next 25 years. It is not part of our budgetary problems. Therefore, we have the luxury of worrying about Social Security after we get our economy rolling again. 

The same can be said for the scary talk about our deficit. You hear fear mongering about our heading the way of Greece. We are not Greece (I’m really not picking on the Greeks, folks). Greece is stuck with having a European currency (the euro), not its own. It can’t manipulate its currency as a way out of its deficit problem. Greece is up the Euphrates River without a paddle. Our currency is solid. Investors still respect us. Besides which, Greece has tried the conservative-favored austerity programs and that has only increased hardship on the Greek people while failing to solve the deficit problem. (If you are nodding off, throw some cold water on your face. I’ll wait because this stuff is important).

Now the bad news. We are facing another fiscal crisis. The crazies die hard. They threaten blackmail. No increase on the debt ceiling, they say. The problem is our government has already spent the money. Now it is time to pay the bills. You have to raise the debt ceiling to pay what we owe. In ordinary times, my friends, it is not a very conservative idea to fail to pay your bills. Financial institutions recognize this fact of life and that is why there is such a thing as a credit rating. So, as much as it is difficult for me to write this, another fiscal cliff looms. 

Democrats and Republicans alike are frightened. Republican Speaker of the House John Boehner is as worried as the president. The only difference — Boehner can lose his tan. It’s like an episode of “The Walking Dead.” You’ve just killed a bunch of zombies, but here comes the crazies again. Can sanity prevail? 


Contact the South Philly Review at editor@southphillyreview.com.

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1. Fred said... on Jan 10, 2013 at 06:38PM

“I still say it would have been better to have the "draconian" cuts and elimination of all the tax cuts. Really. Congress is incapable of taking responsible action toward reducing the public debt. Bring on the mild recession and fiscal sanity.”


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