So, it is official. With the one of the largest political and financial crises of our lifetimes set to hit every American in just over a week, the people you and I elected to solve problems are MIA. At the first opportunity Congress bailed faster than a Kardashian in a marriage. We assume they will be back sometime toward the end of next week, just in time to have a good two or three days of work before the fiscal cliff actually sets in. This is the pessimists ultimate “I told you so” moment; the “throw ’em all out and get new blood” caucus is having holiday; Christmas will come twice for them. So the question is, would you rather make Congress actually do their job, or let them spend Christmas with their families? There probably is not a right answer here, but the fact that they are getting out of dodge just before the shootout once again shows why we as a nation do not trust them or approve of their performance.
So with the probability of driving off the fiscal cliff edging closer to a sure thing, maybe it is time to ask the bug question; would going off the fiscal cliff really be that bad? If a simple yes or no answer would do, I would have to look into writing sports articles or screen plays. Before you call me crazy, hear me out; the media and government are telling you it is the end of the world, but is it? By now everyone in the most remote parts of the world is aware that going off the fiscal cliff means an end to the Bush era tax cuts, the long term unemployment benefits, the payroll tax holiday, and the alternative minimum tax alongside the “sequester” spending cuts; across the board spending cuts of 9.4% for all Pentagon departments, and 8.2% for nondefense discretionary spending totaling $1.2 trillion. So what would your post-cliff world look like?
The question on everyone’s mind is, how will this affect me? What does this mean for the economy? Those on long-term unemployment will be hit the hardest. Typically unemployment benefits run for 26 weeks, or six months. However, during the brunt of the recession they were extended to 73 weeks, or just under a year and a half. This means people that might lose their jobs after the fiscal cliff will be in trouble if they cannot find a job. To gauge that we need to figure out how far the fiscal cliff freefall will be. The answer, according to most economists, is between 3-5% next year. To most normal people that number means nothing, so to interpret, that is about a little less than the 2008 recession; meaning this would not be an end of the world scenario like cable propaganda channels might tell you.
Even if you look at layoff estimates, digging into the numbers makes the fiscal cliff seem more like a fiscal diving board–maybe not even the high dive at that. Estimates are that we may lose in the neighborhood of 1.5-2 million jobs if we go off the fiscal cliff. That seems like a huge number, but we have to remember that when President Obama took office, as he so readily reminded us during the campaign, we were losing 800,000 jobs per month. So the total job losses from the fiscal cliff might be about as bad as two or three months of losses at the beginning of 2008; maybe even less. I know that is a tough pill to swallow, but we know from 2008 it is not impossible to overcome. Moreover, business experts have been saying the reason businesses and banks are sitting on their hands is the uncertainty of the future. We now know Obamacare will stand, we now know who the President is, and after Jan. 1, whether a deal is struck or we go off the cliff, we will know exactly what the taxing and spending picture looks like as well–no matter what happens we will have certainty. With certainty businesses will know what to expect and what they can do. We may recover faster from a fiscal cliff dive than from the recession.
So the bad news might not end up being as bad as many expect it to be, but is there good news? Yes, the good news is that going off the fiscal cliff will make a significant dent in our federal spending, and with the increased revenue, our deficit as well. Going off the fiscal cliff will mean we have a solvent, respectable nation to hand over to our children. Going over the fiscal cliff means we will return to the tax rates that we had under Clinton, and similar to those under Reagan–the two highest growth periods in our lifetimes. The first rule of philosophy is that just because something happened after does not mean it happened because of. Yes there were other factors in those growth years, Republicans love to point out the internet boom under Clinton, but we cannot let them forget Reagan got us out of a recession at the same time he raised taxes.
Unfortunately that was a different era. An era of moderate Democrats in the south and progressive Republicans in New England; an era without cable and talk radio propaganda; an era where doing what the nation needed was applauded by your party, even if you had to go against your party to do it. Congress is far too polarized now for Speaker Boehner and President Obama to strike a Reagan—O’Neal type deal; the two party system has made it that way.
Yes, going off the fiscal cliff will hurt, but it might just be a sprained ankle or broken arm; it will not be suicide. We have had a 5% GDP drop at least 8 times since WWII, and we always came out stronger. Unless we get a real deal, a real grand bargain that raises significant revenue and makes major spending cuts we will stay on the path we are on. Congressman are more worried about their own re-election than they are their own children’s future. The path we are on is the same path as Greece; another decade one this path and we may have to face austerity as well–that would hurt much, much more then the fiscal cliff, and our children would be paying for that for generations.
Going off the fiscal cliff, or any other big deal for that matter, will be bad in the short run, but it is manageable. And in the long run we will be the better for it! It will put us on a fiscally responsible path, and be I first step to the major spending cuts we need to make sure we have programs for the future. Going on a diet always sucks, but after you have trimmed down your fat it is worth it.
We can and we will recover from the fiscal cliff, should we take the dive, and we need a painful solution to our problem. Nobody wants higher taxes, but we cannot have low taxes and big government programs without becoming Greece. This is the corner we have painted ourselves in; if you do not like it, vote for someone else in two and four years. A small deal will not help, and a big deal seems unlikely. Unfortunately the most likely scenario is more of the same–extending everything at its current state, kicking the can down the road, as they say. Unfortunately we are close to kicking the can down our children’s’ throats. The fiscal cliff is our CPR. If we do not get a major deal, it might even be our best option.
26 December 2012
In 2008 it was hope and change. The buzzwords flying around Washington after this election are mandate and compromise. Does the President have a mandate? If so, for what and how strong is it? Patriotslog has two specific take-aways from this election: 1. most independents that we have spoken with did not vote for Barack Obama as much as they did against the radicalism of the Republican Party. 2. Mitt Romney was right; 47% of Americans were always going to vote for President Obama. However, he was wrong in saying who they were. Socioeconomics have little to do with the division of our nation; the 47% were not those who felt they were victims and were looking for a handout, it was the 47% that were default liberal, the MSNBC 47%, the 47% that never question Democrats, and never believe Republicans. But Mitt Romney had his own 47%; they were the polar opposites, the Fox News 47%. Read the rest of this entry
It was never 1980. Barack Obama was not Jimmy Carter and, of all the uncertainties in this election, one thing was always certain; Mitt Romney is no Ronald Reagan. People liked Reagan as a person. As a person, Romney was very unpopular, he was not trusted, and he was generally viewed as out of touch. Republicans told themselves it was “1980 all over again” to provide hope. When I heard this become a common phrase in right wing political circles I know the GOP was fishing in the dark for something to keep their supporters enthusiastic. It was never 1980; that was clear to anyone that looked below the surface. In 1980 winning 62% of the white male vote (60% of the overall white vote) meant almost a certain victory; Mitt Romney won that demographic, and was not nearly enough. The demographics continually shift against the ultra-conservative base of the Republican Party. Regan had a history of raising taxes; Romney said out right, the rich need to pay less in taxes.
The Republican Party is bleeding from self-inflicted wounds. If someone does not step in, they will bleed to death. There are already whispers that Mitt Romney lost the election he was not conservative enough . This is just the bitter excuse of a party that is becoming irrelevant. The national elections show that, if anything, the Republican Party is to blame for the defeat of Mitt Romney; Mitt Romney is not to blame for the defeat of the Republican Party. While the wild swing of the base of the Republican Party to the right won House seats in the 2010 election, the nation has now seen the fruits of the tea party; and it is a bitter drink. There was more dysfunction from this last Congress than any time since the Civil War era. The nation has seen that the Tea Party does not govern, they just protest and oppose.
The Republican Party did not fix anything after the 2010 election, and their blatant opposition to everything pushed them out of favor in the national scene. If Ronald Reagan were to run today he would not even make it out of a Republican primary. The base of the Republican Party has forced politicians to become more and more conservative in order to run. Mitt Romney, a middle of the road politician for his entire political career, had to shift so far to the radical right in his primaries that rather than highlight his inconsistencies and flip flops, the Obama campaign decided it would be more effective to paint Mitt Romney as a far right extremist. This was not an asset to the party, it was a liability. For the GOP to insist they need a more conservative candidate is to plunge the dagger back into their own belly.
For evidence we can first look at Indiana and see the most obvious example. First it must be made clear: Indiana is a lock for Republicans. It was sure from the beginning that Romney would win Indiana, and the President did not even campaign there. So logic would dictate it would also be a lock for Republican Senate. Six months ago the Democrats would not have even hoped to win; Dick Lugar was a 36 year senator who had been instrumental in many major events in recent United States history, including winning the Cold War. But nobody voted for Dick Lugar on Tuesday. Why? Richard Murdock, a tea party candidate now infamous for saying that a pregnancy resulting from rape is the will of God. There is sound logic in that, if one believes that God chooses when a woman gets pregnant; however, the comment was interpreted as cold and chauvinistic. The radical right wing elected Murdock as their candidate when they defeated Lugar in a primary. How did the independents and sane republicans reward the tea party for this? By electing a Democrat to a Senate seat that has been 36 years Republican. Murdock was so far to the right wing that the rest of Indiana could not see fit to vote for him.
While Richard Murdock lost because of his right wing extremism, his rape comment was at least understandable. Todd Akin is a different story. In Missouri the Republicans expected to pick up an easy senate seat; first time Democrat Claire Mccaskill had become hated for her antics, which included the use of a private jet which she tabbed to the tax payers. Then Missouri heard Todd Akin speak. He stated that if a woman is “legitimately” raped, her body can shut down the reproductive system, and keep her from getting pregnant. You cannot make this stuff up. Patriotslog has wanted to ask Mr. Akin, if somebody is “legitimately” shot, does your body have a way to shut that down so you will not bleed? Needless to say, if his recent medical discoveries did not cost the Republican Party the election, his ultra-right wing mentality did.
Scott Brown, the Senator from Massachusetts who won the special election in 2010 during the Tea Party honeymoon also lost his race to challenger Elizabeth Warren. The Tea Party momentum that swept him into office in a rigidly Democratic state had become his burden. Moderates that have seen the effect of the tea party on government voted for Elizabeth Warren, and the GOP lost another Senatorial Race.
In Utah, gerrymandering had so thoroughly negated the Democratic vote that it was widely assumed Mia Love, the far right candidate in the Utah 4th district, would be able to finally unseat long time sitting Democratic Congressman Jim Matheson. Matheson’s previous district had been spilt into thirds, all heavily offset by Republicans in their new district. Salt Lake, the only remotely Democratic area in Utah was now voting in three separate districts; Love had good reason be optimistic. In the end, she too was too conservative for even Utah voters (many Republicans, and most independents voted for Matheson) and Matheson is once again representing Utah.
Throughout the entire nation citizens largely voted their disapproval of the Tea Party and the ultra-conservative Republicans. Rep. Joe Walsh (R, IL), former Wisconsin Governor Tommy Thompson, Rick Berg in North Dakota, George Allen in Virginia, and Josh Mandel in Ohio are among the many seats the republicans had hoped to pick up or maintain this election. It was being too conservative which cost them the Presidency, and possibly the majority in the Senate. If the Republican Party decides their problem is not being conservative enough, it will diminish into total irrelevance. If their base continues to put unqualified, radical candidates into the general elections the nation will continue to reject them. In a nation where less than half of Democrats approve of Obamacare; in a nation with higher unemployment than on this day four years ago; in a nation that is statistically recovering from a recession at a pace slower than the great depression; in a nation $16 trillion dollars in debt; in a nation headed toward a fiscal cliff, Republicans still could not make any gains on election day because the voters clearly do not approve of the radical conservatives the GOP had to offer.
For the Republican Party to have a chance in the future they need to make three distinct shifts from their ideology. First, they must agree to raise taxes. The assertion that we do not need to raise taxes to balance the budget is asinine and ignorant. A majority of Americans would support higher taxes because they are logical enough to see that, while spending is the majority of the problem, our historically low tax rates also contribute significantly. Second, they must be first to immigration reform. Patriotslog predicts that President Obama will propose immigration reform that will be rigidly partisan and hardly beneficial to the nation, intentionally designed have a hard time passing. This is because he broke his promise during the first term, when he had a Democratic majority in Congress, and now can blame a failure of immigration reform on the GOP House.
He will design the bill to fail because not having immigration reform actually helps the democrats. They make immigrants believe the Democrats are on their side, because Republicans talk tough on immigration, but Democrats do nothing to help immigrants. If the GOP proposes an immigration bill before Obama, and heavily press the message that they are the party to reform immigration, thereby ensuring immigrants do not work below minimum wage, live in overcrowded housing, and can have healthcare outside of the emergency room, while the President lied to immigrants and did not help them and deported record numbers of immigrants, they can make huge strides in the changing demographics. Third, they must nominate Reagan style candidates, not Paul Ryan, for president.
The best hope for the Republican Party is the politician a most similarly resembles Reagan in policy: someone like former Utah Governor Jon Huntsman. Because of his policies Utah has been named the best managed state in the Union. Because of his policies Utah was among the states least affected by the recession. Because of his policies, a state that ranks about 30th in population is now 7th in financial services assets. Utah is rivaling Wall Street. If the Republican Party continues to insist on radicalism they will die. Unfortunately, most of the party will not realize this, or they will refuse to believe it. Biased talking heads worshipped as idols in the conservative world like Shaun Hannity, Rush Limbaugh, Glenn Beck, and the Fox Propaganda crew will feed the fire of unyielding conservatism, insisting Mitt Romney lost for being too moderate. If the party does not turn off their propaganda, they will die. Remember, it was Reagan, not Carter, that raised taxes and granted amnesty.
8 November, 2012