Suppose You Were An Idiot....

By Frank Hill

And suppose you were a member of Congress. But I repeat myself.' (Mark Twain-'Biography')

We Americans often make fun of our elected officials, sometimes too much. It is part of the our collective American heritage and DNA to not take any centralized concentration of power in any elected official 'too seriously.'

After all, the very best and smartest leaders we had in 1776-- Jefferson, Madison, Washington, Franklin, Adams all agreed that the young American colony should rise up and revolt against the capricious behavior of King George III and the British Empire to declare independence for our new nation.

After that, there was no way in Hades the citizens of the United States of America were ever going to bend over backwards and just give any President, or any Congress or elected Senate 100% obeisance and dutiful homage without reservation, directly or humorously.

If you have been following the news lately about the inability of Congress and the President to come to any sort of an agreement on the budget, however, you may come to the same conclusion as Mr. Twain himself. And mean it this time.

Especially if you are a conservative, low-tax, strong national defense true blue believer.

Because the 'conservatives' of this Congress have painted themselves not only into the 'proverbial corner', but into the 'actual outhouse' of budget negotiations.

Here are two hard-rock certain realities in American public policy today that will directly affect you, the American citizen and taxpayer in 2013 absent any legislative changes between now and January 1 of the same year:
  1. Your taxes will go up effective December 31, 2012 at midnight. Happy New Year!
  2. The budget sequester will cut major portions out of the existing defense and domestic budgets but more out of defense due to the way it is structured.
If you want lower taxes and a full defense budget, guess what? As of January 1, 2013, as a result of these last several 'major' budget negotiations and deals in Washington, DC, absent any legislative changes, you. will. lose.

President Obama didn't veto the extension of the Bush Tax Cuts in December of 2012. He ALLOWED them to be extended for every millionaire and billionaire in this country, completely contrary to his promise to 'raise the taxes of the wealthy and make them pay their 'fair share' (whatever that is).

Not only are these lower tax rates scheduled to expire on everyone, rich and medium-income, 24 million more Americans will be socked with the dreaded AMT (Alternative Minimum Tax) absent any further legislative action in the next 12 months. Read about it and weep.

If you are an Obama supporter, you have to be cackling like a happy hen nowadays.

If (when) President Obama wins re-election in November, 2012, you get to see all of your dreams, beyond the national health care plan that is now law called 'Obama Care', go into full fruition: 1) higher tax revenues coming in to the tune of $4 trillion over the next 10 years and 2) the defense budget being gutted far above what is going to be a lower baseline simply due to the phase-down of troops in Afghanistan. Full withdrawal is expected to be completed by the end of 2014.

Why in the world would President Obama want to negotiate against himself and his party's stated principles in 2012 heading into a presidential election and do anything with the Republicans in the upcoming year? He has already 'won' on everything he wanted, hasn't he?

If he just lets the Bush Tax Cuts expire on 12/31/12 after his re-election, our projected budget deficits will plummet to about 2% of GDP, down from 8.5% of GDP this year in 2011. See it for yourself at CBO Projections. (Remember, the 'baseline' already includes higher revenues from the expiration of the Bush Tax Cuts because that is 'current law')

President Obama could then take credit for being one of the greatest deficit-cutters in American history. And he would not even need the acquiescence of the US Congress....all he would have to do is veto any extension by December 31, 2012.

His only Achilles' Heel is the fact that the expiration of the Bush Tax Cuts will really sock it to the middle-class with higher taxes that he has also 'promised' he would never raise on them.

But so what? He is our duly-elected leader. He has also 'promised' to bring our deficits down to less than half of what they were before he took office, especially since that dastardly old President Bush and a GOP Congress had raised deficits to about 3% of GDP in 2008 when he left office.

The ONLY way we see ANYTHING happening in 2012 is if President Obama's 'Chicago Guys' get a strong whiff of the swamp gas called 'Taxpayer Anger' in 2012 when everyone starts to figure out that their taxes are indeed going to skyrocket at the end of the year if nothing is done in Congress.

Then you will see the GOP work out a more favorable defense budget (meaning more spending and less cuts) with President Obama because they also want to extend ALL the Bush Tax cuts again and Obama wants everyone to keep their tax cuts...except the wealthy, yada-yada-yada.

In the end, we see the tax cuts being extended for the less-than-wealthy, the defense budgets being fully restored and some of the very-high end tax breaks for the wealthy being curtailed on a single-shot basis.

The budget deficits, however, will remain in the 5%+ of GDP range for the rest of this decade. Alas.

What did you think would happen? President Obama, the GOP House and the Democrat Senate all of sudden become President George Washington, Thomas Jefferson and Henry Clay all at the same time and do something heroic for our nation?

Even Mark Twain knew better than to expect such a ridiculous outcome.

(Editor's Note: Frank Hill's resumé includes working as chief of staff for Senator Elizabeth Dole and Congressman Alex McMillan, serving on the House Budget Committee and serving on the Commission on Entitlement and Tax Reform. He takes on politics from a fiercely independent perspective at the blog Telemachus).

1 comment:

  1. After reading the title and first line, I was reminded of a joke I recently came across...

    I met a fairy today that said she would grant me one wish.
    “I want to live forever.” I said.
    “Sorry,” said the fairy, “I’m not allowed to grant wishes like that.”
    “Fine,” I said, “Then I want to die after Congress gets their heads out of their (hind sight).”
    “You crafty bastard!” said the fairy.


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