Open Chat... All Day, Every Day! Express Your Views, Debate, and Challenge the Views of Others!

In order to keep up with the nature of free, spirited debate, I wanted to place the chat feature at the top of the homepage. This ensures people can come here and share their views on anything they wish and not have it be related to any specific discussion. Here, people can share ideas, links, and views "unmoderated" and an their own pace. To me, this makes The Elephant in the Room blog truly a place for debate.

Friday, December 14, 2012

Open Forum: Fiscal Cliff Friday

Here we are about one month away from the self-imposed "fiscal cliff," and, as expected, the opinions are flying. I believe that because of the mainstream media's liberal leaning it's difficult to get a real sense of what this situation comprises. It seems clear that the media has taken sides, (here, here, and here are just a few of many examples), so getting real, truthful, fact-based information might be difficult.

Regardless, based on what we do know, how would YOU solve the problem. Put yourself in any situation: As a senator, a representative, the President, a casual observer, a taxpayer... whatever you like. How would you handle the situation? Would you negotiate? What do you think should be the solution? What would you like to see as the outcome? This open forum is for just that: sharing any thoughts, opinions, advice, information, etc., that you have concerning the fiscal cliff. I'll put my quick opinion below; feel free to join in any time.

Happy Fiscal Cliff Friday! :-)


From LME @ 2:22pm EST:

The following chart shows government revenues and expenditures over time - - Thank you RKen for the information (see comment at 11:53am on 11/30 below):

If anyone at any time would like to post graphs, pictures, graphics, etc., please email me at and I'd be happy to post them. I don't want to leave anyone's ability to post relevant information out, and I don't want to have an unfair "advantage" while blogging/debating :-)


  1. My opinion on the fiscal cliff:

    First, let me start by saying that it appears that in addition to taking sides, the media is half-reporting the story. For example, Joe Biden, while shopping at a newly-opened Costco in northeast DC yesterday said basically that in order for anything to get done, the GOP should just accept the democrats' proposal. This is the common view of democrats: it's our way, and that's that. Where is the media outrage in the lack of compromise on the left? This “why don’t you just give in and raise taxes” attack by the media against the GOP is certainly not balanced when interviewing democrats. No one is asking democratic leaders “why don’t you just give in and cut spending.” In my view, the lopsidedness in media coverage is dangerous for all.

    Going forward, I think the best solution is to not increase revenue at all. I don’t want take rates to increase, and I don’t want loopholes to close, and I don’t want any “revenue increasing” measures of the like, etc. Let’s look realistically at this: Our government currently spends $122,000 per second. That’s three times the average American’s yearly income. This is not sustainable. If we keep going down this path, all we’re doing is permitting the government to spend more and more because, hey,… we can just tax the citizens more and more. If we raise revenue, we are just signaling that we are totally okay with MORE spending.

    With that, an even more progressive tax plan is not the solution. At some point, I want to see a flat tax passed in this country where all Americans work the same amount of time for the government (10% = 6 minutes per hour), but until then, in my view, we MUST slow government spending. As seen many times in this blog, raising taxes on the wealthy does virtually nothing to shrink the deficit. This “well, it’s a start” position is moot. It’s nothing. It’s a drop in the bucket. It’s an ineffectual way to shrink our debt/deficits while promoting class warfare. With only 3.9 million Americans making > $200,000 and 140 million who don’t… why are we targeting the already soaked group that is outnumbered 36 to 1? Hmmm. You want tax revenue? Go after the 62 million people (1 in 5 Americans who have a total, with SS, Medicaid/Medicare taxes included, NEGATIVE tax rate).

    It goes without saying that one of the other reasons (I’ve written about this TONS of times) that I’m opposed to this is that it promotes discrimination. In modern American society, when is ok to single out 1-2% of the population? We think it’s abhorrent to do this in any other case, but ohhhh…. I get it… we can do it now? Tax the rich, as long as it’s not me, right? Gotcha.



    1. In addition, raising taxes now just puts us on the path to more and more and more tax increases. When does it end? Why does the government need to always be taxing us to death? People think that tax increases on the wealthy will only be felt by them? It’s an absolutely untrue proposition. Small business owners, who employ most of America’s workforce, will be hit by this the hardest. In addition to the added costs of Obamacare, taxing the “wealthy” more with be felt by all. Is it really sensible to think that a small business owner will just eat the costs of tax increases and Obamacare costs without passing this on to employees and consumers? Do Americans seriously think that he will just go “oh, cool… a $6,000 bill… yah… I’ll just eat it without attempting to ‘neutralize’ its effects on me?” Please. Get real. For employees, wages will fall, hours will be cut, and they’ll ultimately feel it. Do you think, for example, that the owner of a small shop who makes $270,000 per year and gives his 10 employees a $2,500 Christmas bonus in 2012 will give that same type of bonus in 2013? I highly doubt it. Why would he do that if his take-home pay has fallen? For consumers, prices will naturally rise. For those that think the middle-class American is immune to this, you’re sadly mistaken.

      I want to see spending slashed dramatically, and yes, I do think military spending should be on the table, too. It doesn’t mean cutting strength; it means running the military more efficiently. I want to see entitlements cut drastically (as someone who believes in self-reliance, the system of government-given health insurance, retirement, subsidized housing, et al, is growing beyond our control, and worse, it’s killing industriousness and incentive). We need to have a serious discussion about a plan to curb American “disincentivization.“ That’s our biggest long-term threat. While yes, it sounds great that everyone should have all the wonderful things the government provides to ensure happiness, it’s fiscally unfeasible, and frankly… people need to take it on themselves to earn their own keep. With spending at about $12,400 per person per year, and $122,000 per second, government spending needs to be slowed or we are going to get to the point of no return. People often say “money is power,” and if that’s the case, the more money we give to the government… the more power it gets. As you have figured… you know where this goes; as the government gets more power, we get less freedom.

      < / rant > Happy Friday!

      Please share your thoughts, ideas, opinions, etc. This is an open forum. Debate all… me, other opinions, express yours. There are no rules :-)

  2. Hope we all have a parachute!

    1. If we don't, China is now urgently reviving their manufacturing making 300 millions of parachutes and hopefully they will end up on shelves before Christmas.

    2. Checked at Wallmart - thanks God they are on the way

  3. Perhaps everything would work out quickly if we line up those, who are elected to make decision on our behalf, on the edge of the real cliff.

  4. Can the new "Anonymous" commenter be hired? LOL to his China chutes and real cliff threat ideas

    1. sure but I need a green card ...

    2. LOL! Making my friday!

    3. ... I changed my mind, I checked taxes, it's better for me to stay where I am and make parachutes. But I can make some contribution to your politician to continue doing good job ...

  5. It is just hard for me to fathom that anyone in their right mind would actually believe we can tax our way out of this. But tax our way out of this through taxing 2% of the population?

    Our average deficit since 0bama has been President is $1.363 TRILLION. To "fix" this we are going to increase taxes by a $160 Billion per year and it is solved? By my math we are still $1.203 TRILLION away from balanced. What then? More taxes?

    The best part is while they work on these elaborate plans to "stick it to the rich" 0bama is getting ready for his 3 week, $4 MILLION Hawaiian vacation. Thank goodness we are all sharing in the suffering/sacrifice. I just hope that the 0bama's can all fly in one plane. They seem to like taking a fleet of them. His and her jumbo jets.

    To me, any plan that does not include across the board spending cuts is just political posturing and "kicking the can down the road". I also am of the opinion anyone who is against any spending cuts isn't serious about fixing the problem or they don't want the problem fixed.

    1. Give the man a credit, he deserves nice vacations. Who in his/hers right mind would think that he can make it again with the record unemployment, record deficit, record debt ... but he made it!
      Perhaps for the next round we should work on the (his) voters' literacy so they would understand that RECORD in this case does not mean something positive ...

    2. Aye slim,

      No offense meant, but the vacation/travel talking points always bug me.

      Presidential staff, secret service, Air Force One pilots and staff, etc, aren’t paid on commission. Most of that ‘$4m cost’ are salary/fixed expenses that our government would be spending anyway as part of the normal day-to-day operations associated with protecting and providing the allocated resources for our president. He could choose to stay in Washington, and his pilot would still have to be paid, as would the secret service, as would his personal staff, as would his event coordinators, etc.

      The government doesn’t’ ‘contract out’ our presidential security or travel plans. These people are paid full-time salary benefits, as are 99% of government-related positions. The only real added costs to the POTUS traveling anywhere are fuel, which hardly even accounts for 4% of the $4m figure on a bad day.

    3. I didn't mean to bug you RKen, but facts are facts. Fuel is a little more than 4% (actually quite a bit more)of the travel. From the article I linked to above:

      "The biggest expense is President Barack Obama’s round trip flight to Hawaii via Air Force One.

      A Congressional Research Service report released in May 2012 said the plane typically used by the President, a Boeing 747, costs $179,750 per hour to operate. The U.S. Air Force has listed the cost of travel as high as $181,757 per flight hour.

      Travel time for Air Force One direct from Washington D.C. to Hawaii is about 9 hours or as high as $1,635,813 each way for a total of $3,271,622 for the round trip to Hawaii and back."

      I do understand your point to a certain degree. For instance, we pay all the military personnel whether we are at war or not yet those base salary costs always come up in the medias cost analysis.

      The fuel though accounts for 81.79% of the $4 Million vacation for the King and Queen. $3.2 million worth of the "fuel of the past". By the way, what exactly does POTUS use that runs on "the fuel of the present"? What exactly is the fuel of the present? I know 0bama told us that fuel is the energy of the past.

      How many teachers would $3.2 Million worth of fuel hire? How many starving children would $3.2 Million feed? Or does that line of questioning only work for Republicans?

    4. The operating costs figure you posted includes salaries, staff/crew, etc, that again are paid regardless of whether or not it flies. Check the CBO report that figure points to.

      Fuel cost couldn’t account for “$3.2m” if he took the long way and traveled through Europe first.

      Jet Fuel can be as high as $5 per gallon, though it averages about $4. But let’s use $5.

      The average GPM of a Boeing 747 is 5, and the distance of a flight from Hawaii to D.C. is just under 5,000 miles. But let’s use 5,000.

      That comes out to a high-balled fuel cost of $125,000. Not even close to your figure.

  6. Hi LME -

    Aside from you being MUCH more eloquent (all the cool math stuff, too) I pretty much threw the same rant on this blog yesterday (AND the day before).

    It's the same old same old Wimpy story where the Dems 'will gladly pay you Thursday for a hamburger today'... GHW Bush, and even Reagan got sucked into the Dem smoke and mirrors LIE of 'just give us those higher tax rates NOW - and THEN we'll surely take look at cutting some of that ugly, wasteful spending' *wink, wink* *fingers crossed*

    All we hear is how 'great' Clinton was; how HE 'balanced the budget'... like he was all magical and did this ALL by himself. FACT: Clinton's success began AFTER the midterms when the REPUBLICANS gained control of BOTH houses. In order to have ANY chance at a second term, he was FORCED to move to the middle. The left gives him ALL the credit for welfare reform - when in FACT he VETOED the bill THREE times before it passed. (That's all moot now, due to 0's DHS removal/watering down of the work requirement.)

    What (some) people do NOT understand is there's a HUGE difference between DEBT and DEFICIT. While it's somewhat true that Clinton didn't run a Budget DEFICIT - due to an R Congress who held his feet to the fire AND the usual rob Peter to pay Paul hanky panky with the numbers - the National DEBT STILL WENT UP during his tenure.

    Bush II DID spend too much money. SENATOR Obama said so... PRESIDENT Obama THEN went on to DOUBLE DOWN on EIGHT years of Bush spending - in FOUR! News Flash: Bush is NO LONGER PRESIDENT and it's WAY past time for Obama and the Dems to start owning this horrid economy.

    CONSTITUTIONALLY CONGRESS is REQUIRED to pass a BUDGET every year. It's their JOB! Why does it not bother anyone that under OBAMA - CONGRESS has NOT passed a budget in FOUR YEARS!! WHO does that? WHO tries to run their home, their business, whatever endeavor - WITHOUT A BUDGET??

    We had Stimulus One and Son of Stimulus under 0... Biden was 'supposed' to make sure all that money was 'spent properly'. Result: Bankruptcy of nearly ALL the companies that money was supposed to 'stimulate'. That BORROWED money was ADDED to our NATIONAL DEBT - and it's ALL gone, with ZIP to show for it.

    0's newest 'budget' has $500 billion (with a B) MORE stimulus money in it... Now he wants $1.6 trillion (with a T) in NEW revenue... Huh? The tax hikes on 'the rich' only come out to about $800 billion - sooo where does he expect the REST of that money to come from?

    AND he wants Carte Blanche to raise the Debt Ceiling whenever - and for however much - HE ALONE sees fit! --> More 'green' jobs? Government sector of course - which Bacon/Davis will ASSURE go to UNION workers ONLY? A payback to his 'good ol' boys, perhaps?

    The definition of insanity: Doing the SAME failed thing AGAIN - expecting a different result.

    FACT: Ireland, Spain and the UK (among others) are in the process of DITCHING their 'green' windmill programs. They HAVE PROVEN TO BE expensive, inefficient, environmentally destructive, job killing BLACK HOLES. But 0 and his 'green brigade' want MORE of them? To be paid for with MORE borrowed money!


    1. Sooo...How would 'I' fix this mess (aside from dumping 0 and his socialist buddies in Congress : ).

      To start balancing the budget, the Mack Penny Plan is the best - and LEAST painful one out there to date - and NO ONE even mentions it. Cut one CENT from EVERY dollar in the Federal budget and REPEAT EVERY year, until we reach a balance.

      The ONLY exception MIGHT be SS/MediCARE where we'd need to go in and CUT out the fraud and waste.

      ELIMINATE duplicate departments. Many could be deleted completely and sent back to the States (where they belong!) For instance - we have something like 200 DIFFERENT government 'jobs' programs... and how's that working out?

      ELIMINATE Government Agencies - I'd start with the Dept. Of Education (Indoctrination) and give it back to local/state agencies. And before anyone screams: The states NOW send their money to the gov. where it's recycled/bureaucrats are paid, etc, etc and what's left is sent back - w/a Governmental 'teaching agenda'. Why not leave it in the State w/o having to pay some Washington talking head AND all his/her staff out of it - FIRST?

      The States all have their OWN Dept. of Trans... why do we need a government one too?

      D.O. Energy needs to go (the States can do it). Homeland 'Security' need to be disbanded. (We already have the F.B.I and C.I.A) And they can take the T.S.A. along with them... the Airlines can hire privately - and they'll do a MUCH better job.

      E.P.A needs to go as well. *sound of lefty shrieks* E.P.A. is FULL of APPOINTED (UN-ELECTED) Government Bureaucrats. They make 'decisions' w/NO oversight from ANYONE (even the W.H.!)... they seek out and EMPOWER off-the-wall environmental CRAZIES who they THEN encourage (and even INVENT 'supporting EVIDENCE') to bring frivolous lawsuits against ANYONE they choose to demonize. In short - they're OUT OF CONTROL - they need to GO!

      We also need to STOP borrowing money - and giving it to people who hate our guts. Egypt and 'Palestine' come to mind; and we need to get OUT of the U.N. (of which we're the BIGGEST donor)... and kick them OUT of the U.S. (We can use that humungous building to house the homeless)

      But FIRST we need to do AWAY with the automatic yearly increases to government departmental budgets.

      Okay LME - get out your calculator... how much money did I save us? : )

    2. Dara,

      Just wanted to say that you're eloquence is top notch!

      I will say that as far as shrinking the gov't, I completely agree (except I think since they're interstate highways we need an interstate a.k.a. federal dept for this) that allllllll this ridiculous government agencies are unnecessary and should be left to the states. Reduce FEDERAL taxes and let states decide what taxes they want to take and what services they want to provide. Then people can choose to live in a high tax/high service state or a low one... and we can let it play out.

      As far as the numbers and how much you saved... sheesh, I don't know... but it would definitely be a lot, and it would help. Get rid of these departments and all the social redistribution programs that go with them :-)

      And as far as a place to rant and such, that's why we exist. Let it all out! CNN and all these other "news" places block comments and are just made of people attacking each other. I'm glad people can come here for a rant, or a debate, or to learn or whatever they want and not have to worry about the "news" sites junk. Rant on! :-)

      And one day I'll catch you on the chat below and we can share some stories :-)

      Take care, Dara.

      And yes... talking about state's rights... I'll hopefully be finishing Part III of the Modern Federalism series... I like it discussing it, and it gets to the core about how we exist as a nation. It's also interesting... it's less polarizing. Many people are far apart on things here... but with that, I've noticed the divide isn't so big. Many people say, "I'm torn." Either way, I love strong political philosophy debate.

  7. A bit brief today.

    In my view, we need both spending cuts/reforms (with EVERYTHING on the table; military, Medicare, SS, welfare, etc) in addition to revenue increases (also with EVERYTHING on the table; not just tax increases on the rich).

    Of course, I doubt that we’ll ever see anything close to that scale of reform anytime soon, because it would simply be too dangerous (politically) to attempt to do anything quite that ambitious.

    I can’t agree that the government is taking in enough in taxes. They’re certainly spending too much, yes, but that’s a different topic.
    For the last four years, our government has taken in the smallest amount of revenue as a share of our GDP in the past 60+ years. This being true I can’t honestly support the idea that ‘our taxes are already too high/high enough.’

    Ideally I wouldn’t want revenue as a share of GDP to be all that much higher (if at all) than it is now, but until we start getting control of our debt, it simply has to be part of a realistic solution. Keeping our revenues at the same level (or lower) will only elongate this problem further.

    1. This, by the way, coming from someone whose overall tax% is already at 23.8%... so I'm definitely not only saying this because I don't have any skin in the game.

      And I stand by it even knowing that if the Bush Tax Cuts were left to expire, along with the SS tax reduction, my overall tax rate would jump to 27.2%.

  8. RKen - Good afternoon,

    I wanted to be sure to address your comment because you brought up a point: "For the last four years, our government has taken in the smallest amount of revenue as a share of our GDP in the past 60+ years. This being true I can’t honestly support the idea that ‘our taxes are already too high/high enough."

    In all honesty, I respectfully disagree with these kind of notions. When people say, "tax revenue is the lowest it has been for..." or "compared to the rest of the industrialized world, our tax rates are the lowest," to me, makes no sense. First, the "lowest it has been argument" compares tax rates from different economic periods. The second compares tax rates to different economic cultures. Times have changed, countries are different. Both, to me, have no meaning.

    But with that, I did want to take a look at this data. I pasted the graph of the data you linked in the body of the post (thank you!). I found some interesting things (though again, historic analysis, to me, is fruitless):

    1. Historically, our average revenue as a % of GDP (%REV) has been 17.3%. From 2000 to 2011, it has remained at 17.3%. There were 3 revenue "humps" that, most importantly followed revenue valleys:

    a. Through the Carter years (%REV increased significantly then fell off in the early 80s)
    b. Through the Clinton years (%Rev increased significantly then fell off in the early 2008s)
    c. During the Bush years (%Rev increased significantly then fell off by 2007)

    All three of these led to another condition: recession. Now correlation doesn't mean causation, but one of my big arguments against revenue increases, economically, is that taking money out of the private economy - out of people's pockets - is never a good thing. I've constantly asked the question, "how is it good to take more money from people to give to the ever inefficient and wasteful government?" This answer seems to go unanswered. But back to the data. Recessions hit from:

    a. Jan - July 1980, then July 1981 - Nov 1982
    b. Mar 2001 - Nov 2001
    c. Dec 2007 - Jun 2009


    1. Again, correlation means causation? Who knows. There was a minor recession that happened after a minor revenue bump:

      Dec 1969 - Nov 1970 (%REV in 1968 was 17.6% - in 1969 it jumped to 19.7% - an increase of 12%)

      This is one of my biggest fears. Taking money from the people who spend it (which keeps our economy going) is not a good thing.

      On the expenditures side, historically, the %EXP has been 20.6% since 1940. It has been at 20.7% since 2000. If you look at the charts, specifically the second one, we are exceeding that greatly.

      While yes, you're correct, our tax revenues have been low relative to the last 80 years, this tends to happen after the revenue bumps (aka recession causers in my book). Now I know the recent recession came after the massive revenue bump the Bush Era tax cuts brought (yes, I believe that reducing rates brings in more revenue), but most people equate the recession of 2007 - 2009 to loose credit and over-borrowing that led to the credit/housing crisis. Is that recession a non-bump related case? Maybe, maybe not.

      To sum up my view, since yes revenues have maintained a historic level higher than they're currently at, and they can get there again, I don't think a tax increase is needed to get our revenue up. It's been there before. We just need a non-recessionary period... e.g. economic expansion and an expansion of the taxpaying base. Raising taxes will not only do very little to shrink the deficit, but I worry it will cause more recessionary. Taking money out of the economy is not a good thing... ever. We should always strive to tax less and less and less (see Estonia's taxation "problem" since installing a flat tax - yes, I know, different country :) ). The data you provided does show one thing... spending is out of control. It needs to be brought back to "normal" levels. The deficits need to shrink, but I don't think hurting our economy more by taking more money from it is the way to do it.

      Also, as stated above, if you ever want a chart or something posted, just let me know. I know we can't put them in the comments section, and I don't want anyone left out of sharing data. :-)

    2. Unfortunately I'm a bit short on time, even into this weekend (workworkwork), but I did want to at least follow-up.

      Nicely done with the graphs; looks good, happy to provide the data and generate more analysis of the numbers and discussion.

      One thing to keep in mind on your conclusion, is that the revenue increases that proceeded the recessions you mentioned weren't necessarily an immediate result of raising taxes. Each of those recessions had a different complex scenario leading up to it, from recent tax cuts, to recent tax hikes, to sky-rocketing inflation, to low inflation, to economic bubbles, to war-time spending, etc.

      Actually, reading further, it looks like you do acknowledge this. :) But my point in bringing that up, which you also seem to acknowledge (in correlation != causation), is that there are many factors in play for each of these situations and only looking at one or a couple doesn’t paint the entire picture. This additionally being a part of your point you also seem to base your initial argument on (different time economic periods, times have changed, etc).

      That said, I do respect and understand your argument, but I ultimately don’t believe that we can recover from such a large deficit and such a large amount of debt in any reasonable amount of time through purely spending cuts. I’m sure we can both agree on one point, in that the longer it takes our country to get our debt under control and paid-off (likely not in our lifetimes at this point), the worse it ultimately will be for us and our economy.

      There is one more thing I want to touch on quickly:
      “Taking money out of the economy is not a good thing... ever.”

      This is not necessarily true, and is actually part of the reason that Unemployment Benefits have been extended so many times and are such a hot topic. They actually have been theorized to supply more economic benefit to the economy per dollar, than we would otherwise have if we never collected that dollar as a tax (about 10-60% more, depending on the study and period examined).

      It mostly comes down to the people being unemployed simply having a higher probability of spending every dollar they receive, as opposed to the average person those taxes are collected from who are less likely. This indirectly raises consumer spending, which is one of the biggest drivers of the economy.

      There is of course the potential factor that extended unemployment benefits could force people to turn down jobs they may have otherwise taken, or not look as hard/long for a job, but generally most studies seem to conclude that it has helped the economy more than it has hurt. Of course, that is still debatable.

    3. RKen - thank you for responding... I have like 38 seconds since it's time to go to Lowe's lol.

      While yes, we both understand that different reasons do cause recessions... the one thing that is consistent IS the jump in %REV. A wikipedia search of "list of US recessions" shows that virtually all recessions in modern time came after some relative increase in %REV. While I still won't say a precise correlation exists, yet... I will say that it's something we can't ignore, and as someone who does believe taking money out of the private economy hurts, I think this certainly shows that... though again, I won't say it 100%. :-)

      Have a great weekend!

  9. I actually agree that defense spending should be examined. I don't want to say "cut" but it should be examined. If cutting money makes us weaker, then I don't want to live in a endangered society because of our fiscal issues. I want to see if it can be made leaner. If we are spending at the defense levels we are, and we are at 100% efficiency, and this is keeping us safe (if cutting $1 made us weaker), I wouldn't want defense cut. All I'm saying is that we talk like we're experts and say "defense should be cut" but we don't know the picture. Let the experts decide that.

    What does need to be cut are entitlements. What was the number? $2 TRILLION per year!? And it's only growing. Money that we simply give to people to retire and have healthcare. Can't people plan their lives and take care of this themselves. SS and Medicare/Medicaid are a curse.

  10. In continuing this discussion, one thing I have noted is the democrats' "it's our way or no way" "bargaining" plan. I've heard it repeatedly, and yesterday, Secretary of the Treasury Tim Geithner said basically that republicans must accept what the democrats want:

    ""There's no path to an agreement that does not involve Republicans acknowledging that rates have to go up for the wealthiest Americans," Geithner said on CBS News' "Face the Nation"."

    Rates! Yes, rates.

    The purpose of a bicameral legislature, and a three entity government is to ensure compromise. It's to ensure a process for which we change our laws is slow, drawn out, and compromised. But when I hear someone who is supposed to be compromising saying, "it's our way or no way," how does that preserve the American system? Let it be clear, telling the GOP-led House they must adhere to the democrats' wishes or they get nothing is NOT a compromise. The GOP has said they are open to revenue increases. They are willing to compromise. They are not willing to give the democrats' everything THEY want, but they're open to a compromise. They want to increase revenues without raising rates. The democrats are saying they just want to increase revenues by raising rates. So where is the compromise? Well, considering the GOP was adamant against raising revenue at first, and have no opened up to the idea, it appears the GOP IS in fact compromising. But being that the democrats have said they want to raise rates, and that's still their position (don't forget they haven't signaled much of a move on the spending cuts side), where is the compromise from them.

    Our government was formed with checks and balances to prevent and avoid strong-arming anyone. Why does it feel like only one party or faction is adhering to this?

    1. Good morning LME! :)

      By my view, the Democratic compromise on their side of the isle is actually being open to spending cuts and entitlement reform (similar to how the Republican compromise is being open to tax increases and reform). This has been their position for so long now that I think people are forgetting that this was their compromise.

      Recall that in 2011, at the beginning of the year, Democrats were completely opposed to ANY cuts whatsoever in any form while in such a fragile economic situation. Particularly when it came to entitlement reform; 'we're not going to balance the books on the backs of the elderly/disabled.' They fought hard on the idea that “Virtually every nonpartisan analyst agreed that contractionary fiscal policy at this time was unwise...”

      And at the end of all that, we barely got what? ~$30b in cuts? Maybe? And this whopping $30b in cuts was still considered a ‘loss for the Democrats on the budget talks.’

      They did move from this position in agreeing to be open to and even try to put cuts (and at least slightly more substantial ones) on the table, though I agree that it has been incredibly unspecific and mostly just words at this point.

      On the flip side though, the GOP really has done just about the exact same thing. In 2011 they were opposed to ANY revenue increases whatsoever, and now they say they're open to it, but they have yet to put forth anything specific and have done little other than simply say it.

      Really, I find both sides at fault on some level here. They're both essentially playing the same game; throw the ball back in the other court and accuse the other side of not being willing to compromise.

      Democrats: "We weren't for any/much of any cuts or entitlement reforms before, but we are willing to compromise on it now, but the other side still won’t accept our tax plan/propose one of their own! And their overly ambitious spending cuts are a non-starter."

      Republicans: “We weren't for much of any tax increases/tax reform before, but we are willing to compromise on it now, but the other side won’t accept our spending plan/propose one of their own! And their overly ambitious tax plan is a non-starter."

      Generalizing and such, but ultimately I don't believe that's far off from the reality here.

    2. Good morning RKen!

      I have not seen anything from democrats on spending cuts now. If you have information on what they'd be willing to "put on the table" please share it. It appears that they don't have anything, and the longer it goes on that they can, via the media (and I've cited numerous examples of this before) keep hammering the GOP with "well, why don't you just raise tax rates," the longer they don't have to answer that bell.

      Additionally, regardless of if they have actually agreed to spending cuts or not, where is the compromise in "the GOP must do it our way?" Through all the positioning and hype, we seem to forget that this is supposed to be a compromise... not "I'll give you some of what you want if you give me all of what I want." As far as being "guilty," partisanship aside, I see the democrats are the only culprits of this... I cited one of many particular examples. It's akin to Joe Biden saying, "yes, we can avoid the fiscal cliff if the GOP just agrees to raise tax rates."

    3. Rken will there ever be a day you don't stick up for the left? :-)

      But somewhat seriously, with the way you're able to spin away anything that's said against them, you should be the WH press secretary

    4. LME: "I have not seen anything from democrats on spending cuts now. "

      Not sure if you might've missed it, but I agreed with that statement. I haven't seen anything other than them saying they would agree to spending cuts. But no indication as to what cuts, where, and how. And no real proposals of their own.

      But this is the same exact thing from the GOP side when it comes to taxes.

      The GOP says they will agree to revenue increases, but no indication as to what specific increases, where, and how. And no real proposals of their own.

      I’m not sticking up for the Democrats. But I do think it would be disingenuous to say that the Democrats are getting all they want here and always have and have tried to since the beginning; if that was the case then NO spending cuts or entitlement reform would be acceptable in any budget/debt bill (as they originally fought for, and exemplified in the several articles I linked). It would be STRICTLY tax increases and Democrats would call any bill with spending cuts a ‘non-starter.’

      Anna, of course if you feel that something else here is going on, I'd be happy to hear/see your ideas of this and debate that with you. Otherwise, I don't see how anything I said was a "spin" or not the truth. It comes down to this:
      1. Democrats did compromise in moving from no cuts whatsoever, and absolutely no reform, to willingness to accept cuts/reform.
      2. Republicans did compromise in moving from no taxes/revenues whatsoever, to willingness to accept tax revenue increases.
      3. Neither side has proposed a specific plan for what they would accept from the other party's compromise (GOP hasn't proposed a specific tax revenue plan, Dems haven't proposed a specific spending cut plan).
      4. Neither side is accepting the other party’s plans in their compromise (the Dem’s tax proposal, and the GOP’s spending cut proposal).

      To me, anything other than addressing those points directly and explaining why they’re false is the real attempt to spin the situation here.

    5. RKen - I got that you got it, but maybe I worded my response incorrectly. I merely wanted to emphasize that I've seen nothing come from the democrats.

      I do disagree with you about "the democrats did compromise." I've said this a few times that in lieu of there being two sides of a compromise, the democrats have only "bargained" on one. A compromise is, "I want A and will give B; you have C and can give D."

      The democrats are saying, "we can give some of B, but you MUST adhere to all our A." I've cited this a few times now. Compromise is not say, "sure, we will give you some of what you want if you roll over to all of what we want." Saying the GOP must agree to increasing rates is just that. The GOP has a C (want for spending cuts) and opposed to but can give D (revenue increases). A "meeting in the middle" for D seems to be what they have proposed: a platform of limiting deductions, write-offs, etc... but not touching the rates. In my opinion, that is part of the "giving you some of what you want - but not all" to the democrats. Now yes, they haven't given specifics, but why would they? They're giving propositions and platforms... when the democrats agree to hear them out, then you go into specifics... but you don't put the cart before the horse.

      So I do respectfully disagree that the democrats are compromising as a "do it my way and give me all I want" is not a compromise at all. I'm not sure though am open to hearing how there is something different to take from this.

    6. This is probably getting lost in the semantics, but I didn't say the Democrats have compromised on taxes.

      I said that they compromised on the spending cuts, though the degree to which is still unknown of course (as mentioned earlier... they haven't proposed any specific plan of their own and have only rejected the GOP's plans). Again, my first bullet:

      “1. Democrats did compromise in moving from no cuts whatsoever, and absolutely no reform, to willingness to accept cuts/reform.”

      No mention of taxes in that bullet.

      Likewise though, the GOP has compromised on revenue increases, and the degree of which is still unknown (again, they haven't proposed any specific plan of their own and have only rejected the Dem's plans).

      The Dems haven't attempted to compromise on tax cuts, and the GOP hasn’t attempted to compromise on spending. The Dems have attempted to compromise on spending (to an unknown degree, with no proposals of their own), and the GOP has attempted to compromise on taxes (to an unknown degree, with no proposals of their own). That make more sense?

    7. As far as whether or not they should give specifics:
      "Now yes, they haven't given specifics, but why would they? They're giving propositions and platforms... when the democrats agree to hear them out, then you go into specifics... but you don't put the cart before the horse."

      I can't agree with that line of thought; it ultimately would lead to us getting no where. If both sides of the isle took a ‘we'll debate the details when the other side provides them first’ approach, we would never get anywhere.

      And frankly, I'm tired of the empty talking points from both sides when it comes to these issues. We don't need to hear 10,000 ways to beat around the bush with incredibly general and unspecific 'tax the wealthy', 'cut more spending', 'cut deductions/loopholes' talking points to rally around. We should be expecting both parties to put a serious working plan together in starting these debates, and not this dumbed-down theatric of words, semantics, and blame.

      As much as I disagree with many aspects Paul Ryan's budget, I'll always respect him and the GOP far more than the Democrats on that issue for *at least* putting a specific budget proposal together.

    8. RKen - It might be getting lost in semantics, but I never said that you said they compromised on taxes. I'm saying it's quite the opposite, and I'm not sure how that notion is getting lost. The one thing that keeps getting skipped over is that the democrats are saying that a "compromise" means the GOP must go along with the democrat's for raising tax rates. I don't believe that's a compromise at all. The GOP has not, neither for spending cuts or revenue generation, said that the democrats have to go along with a GOP plan. Regardless of whom puts forth a plan and when (which again, I think it's better to negotiate on platform first), to say, "it our way or no way," is not compromise.

    9. And trust me, if the GOP claimed they were going to compromise, but said that the left must take on their view for a component, I'd be ticked at them, too: :-)

    10. Were you ticked at the GOP when they claimed to try to compromise, but took a "my way or the high way" view on no revenue or tax increases whatsoever last year? :P

    11. LOL, no. No one came to the table with the promise to compromise under the current demands. I'm upset at the jostling of "we are going to compromise" and then not doing it. Last year, no one took this "high road" approach of compromise. This year it's different; round 2 is different. We have both sides now pledging to compromise, and that being declared, they should do it.

  11. @Anna - While I agree 'SS and Medicare are a curse' there a people (like me) who've paid in their whole lives, are coming closer to 'retirement age' that Obama and his Socialist buddies have pretty much stuck in this Govt. loop.

    My husband and I DID plan for our old age. He's retired now (his is a matching 401 type program) and WE pay for our own health insurance.

    Here's the 'snag' brought on by Obama'care'.

    We've paid into this health insurance, faithfully, for over thirty years. Now we're being TOLD that we MUST revert to Medicare!! Before the Obama regime - it had been an option - now it will be MANDATORY when we reach age 65.

    What's really confusing is that my husband is NOT eligible for SS and he has NEVER PAID INTO SS or MEDICARE. He's a 30 yr. retired police officer and his pension and insurance was ALWAYS a split payment between him and his employer - since he's retired, we've picked up the whole tab for our health insurance. (Before he was old enough to apply for the P.D., he spent five years working for the city, under the same program - hence 35 years paid in.)

    In addition to what I've paid into SS/Medicare (since I was 16), I'm also vested in the same program Hubby's in. In that we've always lived within (or below) our means... we really don't 'NEED' the money and I'd considered NOT applying for SS - so long as I could KEEP the insurance we currently know - like 0 SAID we could while pushing his Socialized health care.

    With the 'rules' as they are now... in order for me to be insured AT ALL, I'll be FORCED to sign up for SS to be eligible for Medicare 'insurance'.

    THIS administration has jammed me directly between a rock - and a hard place!!

    @LME - Obama pulled this 'my way or the highway' nonsense the LAST time. HE finally caved and extended ALL the Bush tax 'cuts', the Debt Ceiling was raised - and he went about spending it as FAST as he could.

    I don't believe he'll cave this time... it's NOT now (and never was) about the money - which the R's can raise from OTHER avenues. He's HELL-BENT on punishing the successful (rich).

    He won't cut the spending either!!

    IF our R controlled House had ANY cajones at ALL, they'd simply start DEFUNDING departments/programs right and left (BEGINNING with Obama'care'!). OUR Constitution give THEM THE POWER OF THE PURSE-STRINGS.

    But they won't and I'm at the point now where I believe Congress should BLOCK that Debt Ceiling power grab and then follow the lead of their 'leader' on the rest.

    Fold their arms - vote 'present' - and 'laissez les bon temps rouler'!

    We've tightened our belts before - and we can do it again...

    Let the GimmeDat Pinheads who voted for this socialist/commie/anti-colonialist monster reap what they have sown!!!

    1. Good point Dara. Let's for a moment analyze what would really mean going over the cliff; the tax increase would hit everybody and in that situation we, republicans, are better equipped to withstand the hardship because we always did live within our means; temporarily Washington may get some more tax revenue but they will soon spent it all as they always do and then when the the economy shrink and we may go into the recession, the tax income will decrease and with falling income the gravy train from Washington will stop. That will on other side hit the most these who voted the "gravy train in" because they simply do not want to work. Then and only then they may think that hey, they should support themselves working and then they may be more receptive for policies supporting real economic growth ...

    2. Dara - I'm big on making sure we honor our contractual obligations as a country, and I'd never propose taking from those who are approaching retirement age and are about to cash out on what they've been forced, via taxation, to put in. So I disagree with Anna there.

      But I will admit that I too think that these entitlement programs are an outdated cancerous burden. The financials are bad (yes, we're growing older, and there just won't be enough people to tax to support a healthier, longer living population), but what is worse is the effects of disincentivizing people to take care of themselves. They're now being told basically that they don't have to save for anything. The two most important things in retirement, a pot of money from which you withdraw steady income and health are now being taken care of. Why would anyone in my generation (I'm 30) do anything to plan for this? Why would they ever be financially conscious of the future? Instead we'll just do what we do: load up on debt, and buy things we can't afford... all while paying for things we don't need and abstaining from paying for the things we do. Disincentivism is dangerous... and it's killing us slowly.

    3. @LME - 30! You're just a baby... : )

      I'm pushing 60 and no math genius (as you know) but I figured out at the ripe old age of 17 that this Social Security thingy did NOT look like it could possibly work... in the long run. I pretty much KNEW, even back then, that even though the money was automatically deducted from EVERY check - there was NO WAY it could be around in MY 'old age'.

      Additionally the word 'supplemental' is IN the NAME of the program (I WAS good in English ; ) - which ALSO lead me to believe that (if it WAS around) it would NOT/should NOT be your SOLE SOURCE of old age INCOME! So we planned accordingly.

      Turns out I was right. According to the 'experts' (the honest ones) without reform SS is slated to bankrupt in 2020, about two years AFTER I turn 65... and they're talking about raising the age to 67!

      If I, like so many millions of others, had COUNTED SOLELY on that $$ - I'd be in a world of hurt! Our kids are in the same boat you are (39/36 yrs. old) and I preached the 'bad' about SS/Medicare to them their WHOLE lives. They BOTH have supplemental retirement accounts. *whew*

      One kid (daughter) is VERY fiscally responsible - the other (son) - not so much : ( But because their MOM was sooo anal about the matter, they should both be okay - without SS/Medicare, when the time comes.

      But now, I'm hearing rumbles about a gov. 'program' to buy out (steal) the money from people's 401K's etc and use it to 'bail out' SS and other welfare programs. Because - after all - it's not 'fair' that SOME have 401K's or other deferred retirement accounts - while others don't!

      I've heard this before and I hope it's just a vicious rumor... but after four years of 0 and his screams for redistribution - who really knows?

      We have four grandkids, ages 6 to 18! The way 0's going, we'll be at $20T+ in debt before we're finally rid of him! And with today's IRresponsible, gimme-gimme-gimme electorate, I fear Hitlery WILL be NEXT.

      If that turns out to be true, think about this: Due to her drooling love affair with the U.N./Soros and the Agenda 21 groupies, SHE WILL BE much, MUCH WORSE for America (and here we thought that wasn't

      IF WE do NOT get a handle on this monstrous, out-of-control, unsustainable government NOW, what horrors will THEY be subject to?

  12. Hi All,

    I just found this. It's a clear and simple explaination (with pictures!) of America's fiscal problem that even 'math challenged' 'I' can understand! : )

    1. Probably the most dry but informative video I've ever watched. Thanks, Dara for sharing this important info!

    2. @MN 4 Rick - You're welcome. ha ha! You're right... not a lot of bells here... and whistles... just the facts.

    3. It's an informative video, and makes a good point in its call for proper fiscal policy (that I fully agree with), but the comparisons to Greece always strike me as exaggerated.

      Yes, we have ~32 times the debt as Greece, but we also have ~52 times the GDP. America's economy collapsing, while yes still very possible, would not be in anyway comparable to Greece's situation. We would (unfortunately) take near the entire rest of the world with us in a massive, global depression. War would not be all that unlikely, either.

      Something definitely does need to be done long before it reaches that point, but let's not resort to inaccurate comparisons to Greece for the sake of a point.

  13. @RKen - Ever heard the old saying: The bigger they are - the harder they fall? We NEED to look at what's going on in Europe - Greece being (currently) the worst off.

    You lib/progressives want a Swede-style government with American-style taxes. Pick one or the other - you can't have BOTH.

    We've talked about this before... even if you tax the top 2% at 100% it would NOT be enough to put a DENT in this unsustainable spending, not to mention the DEBT!

    And when THEY'RE 'poor' or GONE - whacha gonna do???? Borrow MORE? And what do YOU think happens when reach the tipping point where our DEBTORS fear we might NOT be ABLE to pay them BACK?

    A: The INTEREST RATE that we pay on that debt will RISE... which WILL LEAD to INFLATION - guaranteed. And with the 'rich' gone - we'll need MORE taxes from the NEXT group on the 'wealth ladder'... and so on.

    Me? I choose to get America (government spending) under control NOW - to the alternative of government indentured servitude for the future!

    BTW We STILL have almost HALF of the nation whose EFFECTIVE Federal Income tax is ZERO - AND it's really a NEGATIVE as their REFUNDS EXCEED what they SHOULD have paid in.

    0's plan NOR the Republicans even ADDRESS that FACT.

    By contrast - the Netherlands tax EVERYONE to support their massive Nanny State - NOT just the rich.

    1. No argument from me in that we would fall harder, in fact that's exactly part of my point. We can't look to Greece for what to expect, no more than a multi-national billion dollar corporation can look to a small mom-and-pop store down the street for what to expect in any situation.

      My point is simply that. Our economic crash would be significantly different, just as the economic situations are significantly different. Apples and oranges. We're an apple, Greece is an orange. You don't take a bite of an orange and think "I bet that apple tastes exactly the same."

    2. This comment has been removed by the author.

    3. OUR crash would be significantly BIGGER - in that we'd take MOST of the planet down with us...

      Greece had/has Germany and the EU....And just WHO do you think would be LEFT to bail US out?

      There are none so blind...

  14. The Fiscal Cliff According to Forest Gump: