Monday, September 16, 2013

The Upcoming Debt Ceiling Deal: There MUST be HIGHER Taxes!

Graphs showing how wars and tax cuts have contributed to most of the deficit - and why Obama must not let himself (or the nation) be held hostage to the repukes again in the debt ceiling coming increase.

"Beltway insiders are brandishing the phrase "national security" like a rusty scabbard, but it is impressive that they can do it with a straight face. It is estimated that each of the hundreds of missiles that we intend to attack Syria with costs around $1 million.

One has to wonder: Where are the deficit hawks? You know, the "courageous" ones that step up to the plate to make the "difficult choices" for fiscal probity, such as cuts in meals for needy seniors, cuts of school lunch programs for children, gutting our mail delivery, undermining pensions, letting cities go bankrupt. The ones that destroy our government's credit rating by balking on payment of debts already incurred.

The silence is deafening. It is challenging to avoid the conclusion that all the commotion about the deficit is a lot more about shifting income up to the .01 percent than it is about budgetary integrity. We should never listen to it again." - Letter from  Steve Milligan, in The Colorado Springs Independent, Sept. 13

As the next deadline for increase in the debt ceiling approaches - in less than 3 weeks-  the Reeptards are screaming for even more spending cuts - in order to approve meeting  debt obligations already on the books (which is what the debt ceiling increase is about) . Of course, this will invite a crisis and likely credit downgrade such as transpired 2 years ago.

According to a Denver Post piece 10 days ago the government is set to run out of money by mid-October. However, more recent estimates put it at the beginning of October.  As the Post notes:

"The mid-October date creates a new cliffhanger for Washington, one that's earlier than many analysts had expected. 

In exchange for raising the $16.7 trillion debt limit, Republicans are demanding significant new spending cuts and some are insisting on defunding or delaying Obama's signature health law."

 Of course, the reeptard demands are absolutely insane. First, because the debt limit raise isn't about mainly getting new money into the federal pipeline, but paying off existing debts to our creditors, such as China etc. Refuse to do that and the nation is placed in the same precarious position as a person who refuses to pay off credit card debt- the credit rating is destroyed. In the case of the country, the parallel is "credit default" -   which would be catastrophic. Don't the Reeps care? I doubt it, as their past actions in 2011 disclosed they prefer to be traitors to the nation's general welfare.  Will they now (again) ignore Treasury Secretary Jack Lew's warning that serious consequences will ensue if we do this again, with a likely credit downgrade?  Make your own bets!

Second, because reeptard  policies, legislation -  mainly tax cuts and wars (actually extended  occupations)-  have created nearly one half the deficit. This is shown in the accompanying graphics. Examining the left side chart we see that current debt without the tax cuts and wars would have been about 40% of GDP.   Add in the effects of the Bush II "Medicare Modernization Act" (2003)- which disallowed bargaining any for lower prescription drug costs (like the VA does) and paved the way for private "Medicare Advantage" plans to bleed the standard Medicare and you get to 45% of GDP by 2019.With the wars, unpaid for tax cuts,  the projected deficit soars to 85 percent by 2019. (See right side chart) Add in projected additional defense expenditures and security budgets and you're at more than 90% by 2019.  Attribute any minor decreases in total percentages to the current sequester, mainly affecting the domestic side of the budget. (i.e. total Medicare spending cut via Obamacare.)

Let's also get clear the Reeps are hypocrites more than anything else! They had no problem living with huge deficits during the Bush Junior years, but then those were all about THEIR kind of deficits - for wars and unpaid for tax cuts!   In the fiscal year ending 2011 alone, according to CNBC, there were more than $530 billion in government contracts awarded to defense contractors. That's almost as much revenue as will be raised in a decade by the recent fiscal cliff deal:

 Did Democrats block any debt ceiling increase during the Bush Jr. years? NOOOO.....! Congress instead voted SEVEN times to raise it ! But now, with a DEM in the WH, all bets are off and these gutter rats refuse to see their own contradictory behavior, as they hold Obama and the nation to a different standard. No wonder wifey said she wants to drop all the reep- turds off at Komodo Island to fend for themselves without any guns, and only a pocket knife to share between them,  vs. 4,000 monster reptiles .....hungry for human reptiles.

Part of the problem also, let's concede, is Obama and the Dems' failure to demand higher taxes nine months ago when the "fiscal cliff"  deal emerged. Instead of sticking to what he promised during his 2012 campaign : raising taxes on all incomes over $250k/yr. (which would have pretty well covered a lot of the deficit, Obama punked out and agreed to remove the Bush tax cuts only for the top 1% - those earning $359,000 or more per year (increasing their marginal rates to 39.6%). Instead, as The Financial Times noted three years ago, ALL the Bush tax cuts  (i.e. including for the middle class) ought to have been expired when their termination date arrived, instead of being renewed. See e.g.

The other failure had to do with not seeing madness when it's staring you in the face, i.e. Obama and Dems approving a sequester deal, in order to be the putative "stick" to make both parties come to an agreement on the last debt ceiling fracas, with the stick being $1.2 billion in cuts supposedly shared equally between defense and domestic support. Well, we saw how that turned out! One side, the reepos, actually were mad enough to say 'Fuck the deal' and allow the sequester in - hurling us nonstop toward austerity as it slows growth.

Now, we're in an austerity environment, a seriously low aggregate demand environment - in which whole states - like here in Colorado - are facing nearly $50 billion in repairs, maintenance and re-building costs after these floods are finished. Consider: over 40 miles of highways and roads smashed and washed away, 30 bridges destroyed (20 seriously damaged), 20,000 homes destroyed, and whole towns (e.g. Jamestown) so utterly mashed up by floodwaters they will have to be relocated. Anyone believe private enterprise will step in to do all this? If so, I have a plot of land in Barbados to offer you for a buck! Nope, the only logical source is the federal government.

But what is really rich, what half amuses me, is these reeptard assholes who sit in their little dens in Florida, feeding on the government tit, say with a VA disability check, then howling about how "liberals and socialists want to keep people government dependent by soaking the rich". Are you kidding me? The latest econ stats show the rich are now doing better than ever! The Gini coefficient for inequality is now worse than for the Philippines! The reason? Too low taxes to pay for the expanding needs of a nation, including for disaster relief and hey .....repairing the crumbling infrastructure. Yet these jackwads want to cut everything ....oh, except for defense....while they collect checks which themselves would be sliced or nixed if they got their dumb wish!

In her guest blog from Jan. 3rd this year, Jayne Lyn Stahl put it superbly:

"There is rape, and there is legitimate rape. So, when you hear legislators from the right wing side of the aisle cry out for the urgent need for "deficit reduction," to make much needed changes to Medicare, Social Security, end extensions to unemployment, and curtail food stamps; if they're allowed to prevail, consider yourself raped, America, legitimately or otherwise."

No comments: