How close are we to a deal or the fiscal cliff?

Think Progress: The House will vote on two separate proposals to extend the Bush tax cuts for people making $250,000 and below or for people making $1 million and below on Thursday.

Steve Benen – Obama, Boehner inch closer to debt deal: “This is no small concession of the president’s part. He proposed higher marginal top rates on income above $250,000, while Boehner counter-offered with a $1 million threshold. Obama, despite a strong public mandate on the issue, has moved his figure to $400,000 in this latest offer, with the expectation that the Speaker will be similarly flexible.

“The president has also lowered his overall tax revenue target to $1.2 trillion, from his initial offer of $1.6 trillion.

“On the other side of the ledger, Obama is offering $1.2 trillion in spending cuts, including $400 billion in health care savings, $200 billion from other mandatory programs such as farm price supports, $100 billion in military spending cuts; $100 billion from domestic programs, $290 billion in savings from lower interest on the debt, and $130 billion is savings from “chaining” the Consumer Price Index. More on that in a moment.

“As part of the same package, the president would expect an extension on unemployment benefits, new infrastructure investments, another Alternative Minimum Tax extension, and a two-year debt-ceiling increase (it’d be up to the administration to do the paperwork, though Congress could try to vote for default if it wanted to).

“Is this a good deal? At a certain level, it doesn’t matter, since Boehner says it’s not good enough and it wouldn’t pass the House. But since it may very well serve as the framework for an eventual agreement, it’s worth paying close attention to its most glaring flaws.”

Greg Sargent – Should progressives accept emerging fiscal cliff deal? The big picture: With this deal Obama will have broken the GOP’s fundamentalist opposition to raising tax rates on the rich (albeit only on income over $400,000) something that would have been deemed very unlikely a year ago. He will have held the line against the GOP demand for two years of Medicare — a victory. Debt ceiling hostage taking will have been deferred for two years, meaning it won’t get tied up in the next elections. He will have obtained stimulus spending — on infrastructure, and in the form of an extension of unemployment benefits — and as Paul Krugman notes, that wouldn’t happen if we go over the cliff. (I’m told the talks have not focused on the exact sum of stimulus spending the White House wants.) The price: The expiration of the payroll tax cut and the cut in Social Security benefits. That’s bad, but the damage could be limited, if the White House insists on it. Obama told us both sides would have to get out of their “comfort zones” in the quest for a deal, and it has been apparent for some time that he prefers a deal to going over the cliff. We now are beginning to see what getting out of that comfort zone looks like.

Paul Krugman – Rumors of a Deal: But the cuts are not nearly as bad as raising the Medicare age, for two reasons: the structure of the program remains intact, and unlike the Medicare age thing, they wouldn’t be totally devastating for hundreds of thousands of people, just somewhat painful for a much larger group. Oh, and raising the Medicare age would kill people; this benefit cut, not so much.The point is that we shouldn’t be doing benefit cuts at all; but if benefit cuts are the price of a deal that is better than no deal, much better that they involve the CPI adjustment than the retirement age. But is this rumored deal better than no deal? I’m on the edge. It’s not clear that going over the cliff would yield something better; on the other hand, those benefit cuts are really bad, and you hate to see a Democratic president lending his name to something like that…

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No cuts to Social Security: 

 

Poll: majority of Americans want taxes raised on the wealthy, Republicans continue to stall

Reuters: “Negotiators warned the showdown could drag on past Christmas. A Wall Street Journal-NBC News poll released late on Wednesday …held the potential to shake up the stalemate. Three-quarters of those surveyed, including 61 percent of Republicans, said they would accept raising taxes on the wealthy to avoid the so-called cliff, as Democratic President Barack Obama is demanding.

“With Republicans in Congress already divided, that rejection by their own supporters of the core demand of Republican House of Representatives Speaker John Boehner could further weaken his position.

“Both sides refused to give any ground in public, one day after what Boehner described as a “frank” conversation with President Barack Obama about the remaining hurdles to a deal.”

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I’m quite sure the Republicans in Congress don’t give a damn what their base wants if it interferes with the happiness of their wealthy benefactors.

Also why isn’t there more discussion about cuts to defense spending — why are we now only discussing cuts to the safety net? And that goes for both Republicans and Democrats.

Rep. John Duncan won’t extend tax cuts to 98% of Americans because of reindeer games

Think Progress: in a recent photo-op with constituents, Rep. John Duncan (R-TN) explained why Republicans are refusing to give in. The Tennessee Republican admitted that he won’t vote to extend tax cuts to 98 percent of Americans because doing so would cede control to Democrats:

CONSTITUENT 1: Are you going to sign the discharge petition?

DUNCAN: Ummm…Oh no, I’m not. No Ma’am. I’m not about to sign the discharge petition.

CONSTITUENT 2: Well if you sign the discharge petition, you’ll immediately etend the tax cuts for the middle class.

CONSTITUENT 1: Yea, why would you not want to do that? [...]

DUNCAN: It would take too long to explain that. I’m not going to give control of the floor to the Democrats.

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This guy has been parked in the House for almost a quarter of a century and “has never faced a serious or well-funded challenge for reelection.” So, to all the working and middle class Republican-base-rubes of Tennessee: well done! 

“It is not the president’s job to tame John Boehner’s crazy-ass caucus for him…”

There may not be a “deal.” Smart people have speculated that we may not need a “deal” and, in any case, a “deal” is not necessarily the be-all and end-all of “governing.” I have said more than once that it is not the president’s job to tame John Boehner’s crazy-ass caucus for him. The president was re-elected on a slate of policies that the country wanted. He has no affirmative obligation to water these down just to “get a deal done” for the sake of appearances, just as he is under no affirmative action to offer up Medicare and Social Security as blood sacrifices just so that John Boehner and his crazy caucus will be placated. The country must be governed, It does not necessarily have to be governed efficiently, as long as the manifest will of the people is somehow expressed through it. Perhaps the people would like it to run more smoothly, but they want most for it to run in such a way that it responds to their expressed wishes. For example, there is not clamoring in the country — or any real need — for the kind of austerity agenda to which all the fiscal cliffies seem to be trying to accustom us. If inefficiency is all that saves us from a damaging set of policies, then god bless inefficiency.

— Charles Pierce on the Fiscal Cliff

Call your representative and tell them that if they want to keep their job, they’re expected to do more than vote present — and that you (with a majority of Americans) want tax increases on higher incomes, that tax cuts for everyone else should remain in place, no loopholes or payroll tax holiday should be eliminated for the working and middle-class, and if GOP members can’t or won’t elaborate or verbalize exactly what spending they want to cut, then they need to go along with the plan outlined by the President.

Don’t blame both sides: the GOP has offered exactly NOTHING to avoid the fiscal cliff

We’re so used to the Republican Congress doing nothing that now the media and pundits consider that to be something they’re actively “doing.”

Greg Sargent reminds everyone that both sides are not equally to blame in this fiscal cliff / deficit debacle:

There is an actual set of facts here. They are central to understanding the current situation, and belong in every account of what is going wrong:

1) Democrats have offered a comprehensive proposal that meaningfully details the tax hikes they would like to see and contains substantial deficit reduction, but Republican leaders have not offered a comprehensive proposal that meaningfully details the spending cuts they would like to see. And what Republicans have proposed — such as it is — doesn’t contain nearly as much in deficit reduction as the Dem plan does.

2) Many experts believe that substantial deficit reduction simply requires Republicans to drop their opposition to raising tax rates on the rich.

Look, this is just a sucker’s game. What Republicans really mean when they demand that Obama “lead” is that they want him to propose bigger concessions up front so Republicans can denounce them as insufficient — which they would do no matter what he proposed — pulling the debate further and further in their direction.

Meanwhile, even as the White House has willingly proposed Medicare cuts, Republicans still refuse to give ground on raising tax rates for the wealthy. (This basic imbalance is not changed, even if you think the White House’s proposed Medicare cuts are insufficient.) So here’s a simple question for any pundit who is tempted to blame both sides equally for the impasse: Can you show us how substantial deficit reduction can be achieved without higher tax rates on the rich? If not, then both sides are not equally to blame.

Sargent adds the following for consideration:

* Why Obama is drawing hard line over tax hikes: It isn’t complicated. Here’s the answer, buried in this morning’s big New York Times analysis of Obama’s “unyielding” stance: In his first four years in office, Mr. Obama has repeatedly offered what he considered compromises on stimulus spending, health care and deficit reduction to Republicans, who either rejected them as inadequate or pocketed them and insisted on more. Republicans argued that Mr. Obama never made serious efforts at compromise and instead lectured them about what they ought to want rather than listening to what they did want.

* Why Republicans refuse to detail the spending cuts they want: Paul Krugman gets to the heart of it: It’s very hard to come up with spending cuts that would seriously reduce the deficit without cutting deeply into very popular programs, which is why Republicans want Dems to go first. The problem, as always, is that cutting spending is popular in the abstract but not when the talk turns to specifics. And this time around, things are different: Because Democrats are the ones with the leverage, they don’t have to acquiesce to the GOP demand that they propose spending cuts first.

* Dems should not get hoodwinked into proposing cuts first: E.J. Dionne makes that argument in his column this morning, and this captures the Republican strategy perfectly:

They seem to hope a deal will be born by way of immaculate conception, with Obama taking ownership of all the hard stuff while they innocently look on.

President Obama dares the Republicans to propose SOMETHING they’d cut

Something… anything! Spineless wonders that they are, they won’t do it.

Paul Krugman: “In the ongoing battle of the budget, President Obama has done something very cruel. Declaring that this time he won’t negotiate with himself, he has refused to lay out a proposal reflecting what he thinks Republicans want. Instead, he has demanded that Republicans themselves say, explicitly, what they want. And guess what: They can’t or won’t do it.

“No, really. While there has been a lot of bluster from the G.O.P. about how we should reduce the deficit with spending cuts, not tax increases, no leading figures on the Republican side have been able or willing to specify what, exactly, they want to cut.”

Criticized as weak in past talks, Obama takes harder line: “Amid demands from Republicans that President Obama propose detailed new spending cuts to avert the year-end fiscal crisis, his answer boils down to this: you first.

“Mr. Obama, scarred by failed negotiations in his first term and emboldened by a clear if close election to a second, has emerged as a different kind of negotiator in the past week or two, sticking to the liberal line and frustrating Republicans on the other side of the bargaining table.

“Disciplined and unyielding, he argues for raising taxes on the wealthy while offering nothing new to rein in spending and overhaul entitlement programs beyond what was on the table last year. Until Republicans offer their own new plan, Mr. Obama will not alter his. In effect, he is trying to leverage what he claims as an election mandate to force Republicans to take ownership of the difficult choices ahead.”

Here’s their big ‘fallback’ plan — very courageous: 

Don’t want your taxes to increase on Jan. 1st? Call your Representative!


Obama reminds us that middle-class tax cuts are set to expire if Congress does nothing and, if that happens, every person’s taxes will go up on January 1st. We all know that Doing Nothing is an art form with this particular Congress — so what can we do?

Tim F at Balloon Juice says “Now would be a good time to pick up the phone and add some pressure for your GOP Representative to stop acting like such an ass about the tax and spending negotiations. If his party wants to cut social welfare programs, then man up and propose something. Otherwise just pass the Senate bill that protects everyone’s first $250k in income and let the economy get on recovering. This works best as a full court press so yes, whatever Cockhead McDoodlebrains your district is stuck with, phone them…

Find your Congress person here: http://house.gov/representatives/

Toll-free switchboard numbers: (888) 355-3588 and (888) 818-6641

Guide for first-time callers:

(1) Use a phone. Email has nigh on zero impact. Trust me on this. Letter mail gets read and in fact has the most impact of all, but you don’t have time. Reach the House switchboard at (202) 224-3121 [or toll-free numbers above]

(2) Remember, this person works for you. You pay his or her salary and you voted for them. You’re the boss here, or at least one of them, and it’s they who should worry about what you think of them.

(3) Identify your name and the town or neighborhood where you live zip code. If you are not a constituent don’t bother. Since you guys never listen to me, at least google a zip code in the appropriate district before you call.

(4) State the issue. This is easy: pass the Senate bill or the party gets it. We can (and certainly will) fix the shortcomings later. Talking points above.

(5) How strongly do you feel? Don’t apologize about feeling passionate or pissed off. The squeaky wheel gets the grease. However, keep in mind that teabaggers threaten the apocalypse over everything. Interns get jaded pretty fast when call volume is high. Polite but firm is the best way to go.”

Meanwhile, Nancy Pelosi has had enoughShe’s threatening to force a vote on extending the Bush tax cuts for the middle class, since House GOP leaders seem to only look out for the top 2%.

Fix the Debt: plutocrats are turning up the volume on the class war

“Listening to these people talk about the national economy is like listening to a burglar tell you that you should really polish the silver more often.” Charles P. Pierce

The important thing to understand now is that while the election is over, the class war isn’t.

The same people who bet big on Mr. Romney, and lost, are now trying to win by stealth — in the name of fiscal responsibility — the ground they failed to gain in an open election. […]

Consider, as a prime example, the push to raise the retirement age, the age of eligibility for Medicare, or both. This is only reasonable, we’re told — after all, life expectancy has risen, so shouldn’t we all retire later? In reality, however, it would be a hugely regressive policy change, imposing severe burdens on lower- and middle-income Americans while barely affecting the wealthy. Why? First of all, the increase in life expectancy is concentrated among the affluent; why should janitors have to retire later because lawyers are living longer? Second, both Social Security and Medicare are much more important, relative to income, to less-affluent Americans, so delaying their availability would be a far more severe hit to ordinary families than to the top 1 percent.

Or take a subtler example, the insistence that any revenue increases should come from limiting deductions rather than from higher tax rates. The key thing to realize here is that the math just doesn’t work; there is, in fact, no way limits on deductions can raise as much revenue from the wealthy as you can get simply by letting the relevant parts of the Bush-era tax cuts expire. So any proposal to avoid a rate increase is, whatever its proponents may say, a proposal that we let the 1 percent off the hook and shift the burden, one way or another, to the middle class or the poor. […]

So keep your eyes open as the fiscal game of chicken continues. It’s an uncomfortable but real truth that we are not all in this together; America’s top-down class warriors lost big in the election, but now they’re trying to use the pretense of concern about the deficit to snatch victory from the jaws of defeat. Let’s not let them pull it off.”

— Paul Krugman: Class Wars of 2012

While finance executives urge Congress and the President to rein in spending, finance companies are raking in profits. [...] Meanwhile, workers are struggling. Average hourly pay, when adjusted for inflation, has fallen 0.7 percent over the past year, according to the Labor Department. And the unemployment rate in October was 7.9 percent — it was at a low of 4.4 percent in May 2007 before the recession. It’s a “zero-sum game,” Moody’s Analytics economist Aaron Smith told The Huffington Post in February. Companies are earning record profits largely because they are squeezing more productivity out of their workers without paying them more. — Corporate Profits Reach Record High, While Workers Struggle

Several CEOs — under the guise of a campaign known as “Fix the Debt” — have recently called for cuts to Social Security and other entitlements. Goldman Sachs CEO Lloyd Blankfein, for instance, said that “there will be things that, you know, the retirement age has to be changed, maybe some of the benefits have to be affected, maybe some of the inflation adjustments have to be revised.” “The solutions [to the fiscal cliff] are – it’s the retirement age; means testing Social Security and Medicare,” said Aetna CEO Mark Berolino. [...] Blankfein has nearly $12 million in retirement assets, while Bertolini has $1.5 million. Adding insult to injury, many of the CEOs calling for cuts to the social safety net are underfunding their workers’ retirement accounts — CEOs Looking To ‘Fix The Debt’ By Cutting Social Security Sit On Huge Retirement Accounts

The CEO Campaign to ‘Fix’ the Debt: A Trojan Horse for Massive Corporate Tax Breaks – IPS: The Fix the Debt campaign has raised $60 million and recruited more than 80 CEOs of America’s most powerful corporations to lobby for a debt deal that would reduce corporate taxes and shift costs onto the poor and elderly.

Key findings:

  • The 63 Fix the Debt companies that are publicly held stand to gain as much as $134 billion in windfalls if Congress approves one of their main proposals — a “territorial tax system.” Under this system, companies would not have to pay U.S. federal income taxes on foreign earnings when they bring the profits back to the United States.
  • The CEOs backing Fix the Debt personally received a combined total of $41 million in savings last year thanks to the Bush-era tax cuts. The top CEO beneficiary of the Bush tax cuts in 2011, Leon Black of Apollo Global Management, saved $9.9 million on the Bush tax cuts. The private equity fund leader reaped $215 million in taxable income last year just from vested stock.
  • Of the 63 Fix the Debt CEOs at publicly held firms, 24 received more in compensation last year than their corporations paid in federal corporate income taxes. All but six of these firms reported U.S. profits last year.

Sign this petition to tell Congress that it’s time to let the Bush tax cuts for the richest 2% expire and that they must reject any Social Security, Medicare and Medicaid benefit cuts.

How the plutocrats are handling Mitt Romney’s loss

  
  
  
  

Source: sandandglass

Ezra Klein reports: Chrystia Freeland is editor of Thomson Reuters Digital and author of “The Plutocrats: The Rise of the New Global Super Rich and the Fall of Everyone Else.” We spoke Tuesday about how the plutocrats she reported on for the book were handling Mitt Romney’s loss: 

Ezra Klein: You’ve written about the revolt of the very rich against President Obama, and all the money they spent and time they dedicated to defeating him. So what’s the mood in those circles now that they’ve lost?

Chrystia Freeland: There’s a great joke on Wall Street which is that the bet on Romney is Wall Street’s worst bet since the bet on subprime. But I found the hostility towards Obama astonishing. I found the commitment to getting him out astonishing. I found the absolute confidence that it would work astonishing. On that Tuesday, the big Romney backers I was talking to were sure he was going to win. They were all flying into Logan Airport for the victory party. There’s this stunned feeling of how could we be so wrong, and a feeling of alienation.

The Romney comments to his donors, for which he was roundly pounced on by Republican politicians, I think they accurately reflected the view of a lot of these money guys. It’s the continuation of this 47 percent idea. They believe that Obama has been shoring up the entitlement society, and if you give enough entitlements to enough people, they’ll vote for you.

EK: Here’s my question about those comments. Romney was promising the very rich either a huge tax cut or, if you believe he would’ve paid for every dime and dollar of his cut, protection from any tax increases. He was promising financiers that he would roll back Dodd-Frank and Sarbanex-Oxley. He was promising current seniors that he wouldn’t touch their benefit. How are these not “gifts”?

CF: Let me be clear that I’m not defending any of them. But I think the way it works — and I think Romney’s comments were very telling in this regard — there are two differences in the mind of this class. First, they’re absolutely convinced that they’re not asking for special privileges for themselves. They’re convinced that it just so happens that their self-interest coincides perfectly with the collective interest. That’s where you get this idea of the “job creators”. The view is that to seek a low tax environment or less regulation, that’s not special pleading for yourself, it’s not transactional politics. It’s that this set of rules is the most conducive to economic growth for everybody. It will grow the pie. Now, it also happens to be an incredibly convenient way of thinking. If you’ve developed an ideology that what’s good for you personally also happens to be good for everyone else, that’s quite wonderful because there’s no moral tension.

Continue reading…

What a convenient and self-serving justification for taking everything for yourself! Sort of like this:

Bob Cesca: “Even though Hostess is asking for permission to cut employee pensions by over $1 million per month, they’re also still asking for permission to dish out bonuses [to senior management] totaling $1.75 million.”

And this:

Bloomberg: “Las Vegas Sands Corp. (LVS), the casino company led by billionaire Sheldon Adelson, voted a special dividend that will pay [Sheldon Adelson] about $1.2 billion before an expected increase in federal taxes.”

That’s BILLION with a B. Or this special spin:

Think Progress: “Sen. Mike Lee (R-UT) argued Wednesday: ‘People need to understand that the reason we worry about raising taxes on anyone – even raising taxes on the rich – it’s not that we’re looking out for the rich, it’s not that we’re concerned that the rich won’t be able to fend for themselves, because they will. It’s because we worry about the consequences that will inevitably result from that action and that will hit the poorest among us the hardest.’