Fiscal Cliff 2 Predictions

[whskyfan]

What are your predictions?

I think it will be another last minute deal in which we will have more taxes and cuts in domestic spending (Medicare, Medicaid and Social Security).

And then the a$$holes that made the deal will celebrate themselves as heroes for saving the country again while we pick up the bill.

[Riddick]

MORE taxes? You betcha!

LESS spending? Oh Sure - OTOH, the fact that it's NOT commonly listed with death and taxes makes me doubt the absolute certainty of seeing a significant reversal in expenditure trajectory...

[kbot]

More taxes? Without a doubt.

Cuts to spending (not counting Medicare, Medicaid and social security) - doubtful.

I expect aid to foreign countries to increase. The last I heard this morning, Afghanistan was already pretty much demanding a few billion once we pull out. I don't expect to see any base closures, nor cuts to, say, Dept of Education, FDA or other government agencies.

[Diogenes]

I'm watching the replay of Meet the Press - listening to Simpson and Bowles. Where did that type of no BS type of leadership go? As Simpson said "lets cut the crap" and be honest about where this type of debt is leading us and what truly needs to be done to change the course.

It has occurred to me this dysfunctional term thrown around relative to our government is fodder for bringing in a "consultant" to help the folks work thru their "issues'.

Edited to say these ((**^% poor examples of public service can't even put together a straight and strictly relief bill without loading it up with spending pork.

IF during a true and tragic disaster they can't leave the BS pork alone do we really expect them to do the right, necessary for budgeting deficit/debt purposes?

[Riddick]

Excerpted from
Fiscal Cliff 2: It Only Gets Worse
By Ben Ritz at HuffPo:

• The deal to avert the fiscal cliff was a major development in the budget battles that have been going on for the last two years. It raised taxes for the first time in 20 years. It split the House and Senate GOP unlike anything in recent memory. And perhaps most noteworthy, it passed the Republican-controlled House on the backs of Democrats without a "majority of the majority" -- the first time in over a decade such a thing has happened. Unfortunately, it is hard to argue that this deal is anything but a bad one. Whether you are a liberal, conservative, or a moderate, there is plenty to hate here.
  
  On its face, this seems like an OK deal. Democrats get some tax increases on the top 1 percent and a small amount of stimulus spending, Republicans make the remaining tax cuts permanent and delay sequestration. The problem is that in the context of the budget battles of the last two years, this deal sets both sides up for a massive failure in a few short months.
  ...
  The combination of blind spending cuts and $5 trillion in expiring tax cuts were supposed to be replaced by a comprehensive "grand bargain" that both sides could agree to. Going over the cliff was supposed to be a gun at the head of Congress to force them to act. But instead of making a deal or pulling the trigger, they created a much more deadly cliff to jump off in just two months: Fiscal Cliff 2.
  ...
  If no deal is reached in February, we'll be facing the same painful spending cuts that were postponed this time around. The difference is that instead of a tax hike, the second major consequence for failure will be a default on our debt. The tax hike would have been painful, and it probably would have caused a recession when combined with such steep spending cuts, but the global economy would survive. If we default on the debt, it's game over. Interest rates will rise, our credit rating will be slashed, and the global financial system that will fall to pieces.
  
  Not only is this new cliff more dangerous, but we're also more likely to go over it. A deal would have been much more feasible for Fiscal Cliff 1 than Fiscal Cliff 2.
  ...
  With the Bush Tax Cuts now permanent, Republicans can't raise revenues and sell it to their base as a tax cut anymore. And since there were no spending cuts in the fiscal cliff deal, they will be demanding steep cuts in exchange for raising the debt ceiling. But President Obama and the Democrats won't agree to such cuts without even more revenue. This means that both sides will lack the kind of leverage in February that they had this time around. In short, we'll be hopelessly gridlocked.
  ...
  The deal that Congress passed this week is being framed as an 11th hour compromise, but it would be more appropriate to call it a 14th hour one -- it passed a full day after we went over the fiscal cliff... But the bad news is we have no such breathing room with the debt ceiling.
  ...
  We could have had a grand bargain. Instead, Congress took the easy way out: they cut taxes and punted all the tough decisions for another two months. And even then, they did it a full day after missing their deadline. This was not a breakthrough for bipartisanship, it was a breakdown of our government -- and I predict it will only get worse from here.

[Dude111]

I think it will be another last minute deal in which we will have more taxes and cuts in domestic spending (Medicare, Medicaid and Social Security).

And then the a$$holes that made the deal will celebrate themselves as heroes for saving the country again while we pick up the bill.

I agree totally bud!

[Cherry Kelly]

http://thehill.com/homenews/senate/2758 ... -this-year

YUP the DEMS want to add MORE taxes...

(as if we the people didn't know that already)

[kbot]

http://thehill.com/homenews/senate/2758 ... -this-year

YUP the DEMS want to add MORE taxes...

(as if we the people didn't know that already)

Couldn't help but notice that this arfticle didn't reference the new taxes in Obamacare.....

[Cherry Kelly]

kbot -- no mention of the ObamaCare taxes because those are already a done deal. So these "taxes" will be brand new ones.

What they will be - unknown at the moment. Just that they want more!! and they want more taxes to equal and exceed any cuts.

[Riddick]

kbot -- no mention of the ObamaCare taxes because those are already a done deal. So these "taxes" will be brand new ones.

What they will be - unknown at the moment. Just that they want more!! and they want more taxes to equal and exceed any cuts.

Well, if nothing else at least we know where both sides stand eh?

Right now, we see Congress hunkered down on party lines. Dems won't begin to talk, unless it's about MORE "tax fairness". Reps are similarly reticent to start off discussions, unless it's about bringing spending in line.

The President? He seems more or less content to leave any settlement to Congress, that is, so long as the end result meets with his approval - AND so long as it's done in time to avoid a government shutdown.

Let's say things DO get settled one way or another to one extent or another this time around - Even when a "grand deal" is worked out, isn't this generally the way it goes...?

The "increase revenue" side gets implemented immediately. The "lower costs and spending" side, well, that's another story. That gets implemented over a long stretch of time (if at all).

Politicians complain people and/or businesses are getting hurt. Budgetary savings and expense controls are left at the wayside, or get pushed even further out. Costs and total expenditures continue to climb.

The deficit worsens. Financial markets get the jitters, as the federal government arrives at another fiscal cliff. Both sides hunker down. Dems want more revenue, Reps want less spending - The Prez? Just get 'er done to suit him and in time - pass a bill to his liking, and he'll sign it.

In the never-ending battle, does anything REALLY get settled if the parties always find themselves right back where they were (albeit with a national debt that's much larger AND STILL growing exponentially) - or is it really all just going through the motions to keep the public from waking up to the reality of the situation?

Considering the threat that insolvency poses to national sovereignty, maybe there's something ELSE going on the denizens of DC are all well aware of that's not obvious to the average American...

IMHO, worse than the "grand" game they're playing in Washington, are the behind-the-scenes deals being made we DON'T know about.

[kbot]

As an aside - don't know just how related it is to this larger issue, but all the communities around here (including mine) have just received their 2013 property tax bills. They've gone through the roof for both commercial and residential properties. Many business owners are stating that they don't know how they will be able to stay open. Some small businesses (restaurants mostly) are seeing hikes in the $12K - $30K range. Mine went up for the property, and I'm wondering what it is that I'm getting in return for this........

[Dale O Sea]

You guys missed the one coin solution:

http://krugman.blogs.nytimes.com/2013/0 ... that-coin/

http://www.huffingtonpost.com/2013/01/0 ... f=business

http://www.infowars.com/if-obama-can-ju ... pay-taxes/

http://money.msn.com/now/post.aspx?post ... 58505124cc

Your speculations may be made moot with the striking of a single coin.

[Cherry Kelly]

kbot - have heard of places with higher property taxes - some states put a "lock" on any hikes for seniors (and no they do not just add extra to when property is sold) ... but have talked to some people with hikes - but you can bet there won't be any extra bennies.

====
Dale - read about the "trillion $ coin" and shook my head.

====
We need some good economists, accountants to go through the budget. Have not had time to check it out, but supposedly some of the programs started under Carter years had auto raises built into each. So many were merely duplicating existing groups. They should go! If there are two or three groups doing the same thing - get rid of or combine to one and as noted make every group account for $$ they receive and be sure to double check the "controllers pay" in these. Some years back it was in news about the head of one group who bought a yacht, a second home and something else from $$$ going into that group - while group did very little work (group like low income welfare and just about everything they were supposed to be doing was already covered by other groups).

[Dale O Sea]

...Dale - read about the "trillion $ coin" and shook my head.
====
We need some good economists, accountants to go through the budget....

Ron Paul wanted to do this and more and you see where that got him. Never happen. The govt won't do with accountants and bean-counters what they now do with smoke and mirrors.

And shake your head all you want about the crazy trillion dollar coin idea - but, precious metal aside, this new platinum token would be no more or less worthless than the buck you hand to the clerk for your Wrigley's.

CNN's take on the coin:



This is real, folks.

[kbot]

You guys missed the one coin solution:

http://krugman.blogs.nytimes.com/2013/0 ... that-coin/

http://www.huffingtonpost.com/2013/01/0 ... f=business

http://www.infowars.com/if-obama-can-ju ... pay-taxes/

http://money.msn.com/now/post.aspx?post ... 58505124cc

Your speculations may be made moot with the striking of a single coin.

You just can't make this up, apparently........ My view is that the Federal Reserve banksters won't go for it and will block it with all their might. They don't like competition after all......