I have been amused, and not in the good sense, at the continued inability of Republicans to properly use their power and correctly play their trump cards. Ain’t fur nuthin’ that declarer’s partner is called ‘dummy’.
AIN’T GONNA BE NO TREASURY PAPER DEFAULT
Treasury announced yesterday that redeeming Treasury paper will go to the front of the line and that there will be no default. Well: surprise, surprise, surprise. This task takes up $20 billion, SSI is another $60 billion, and there is $120 billion leftover for all the other stuff. True, Uncle Sam will have to choose which bills he will pay and those which he will not, kinda like a regular family that is having trouble making ends meet. With a few accounting tricks with the Fed, this situation can persist for many, many months.
THE TEA PARTY HAS WON
Senate Pro Tem Reid has taken a tax increase off of the table. Time for the Tea Party to do an end zone dance, take a Sharpie out their left tube sock, and sign a football from a fan in the front row of the stands.
BOEHNER PLAN BE HEAP BAD MEDICINE
(forgive my astonishingly accurate use of the Kwakiutl language). His plan is a $3.1 trillion cut in federal spending (I hasted to point out that even if every nickel of this comes to pass, it is still way short of the $4 trillion that S&P/Moody’s/Fitch says is necessary to avoid a downgrade of Treasury paper). $1.3 trillion of specified cuts (most of which is in the ‘out years’ and hence will never happen anyway); problem: CBO scored it and is only $800 billion. The remaining $1.8 trillion comes from a commission to be created later: kicking the f*cking can down the road yet again (remember his actions and statements during the CR brouhaha?). Has he not noticed that Mr. O has already tried this, Simpson-Bowles as has Ryan? Both plans have been completely ignored, and the one B anticipates (which can easily include a big, whopping, punitive tax increase) will suffer the same fate: total budget reduction = $0.00
NEVER THE TWAIN SHALL MEET
Some boneheads have suggested that Reid’s taking tax increases off the table is the result of the Speaker standing firm, and that we must therefore, in consequence, support his flaccid spending reduction plan. Guh? Reid’s action is probably the result of a private conversation with the House Minority Whip and his most recent head count that a tax increase will simply not happen, and totally irrelevant to anything the Speaker has or has not done.
THE DEBT CEILING MUST BE INCREASED
The Tea Party stance, that they will simply not vote for this, is totally nonsensical. Yes, it makes a mighty nice talking point, but really? Yes, we can still run the Federal Gov’t and not increase the debt ceiling and balance the budget: any idiot who can run spreadsheet can come up with a budget. Problem: this will require an immediate, across-the-board cut of 33%. Unless the Tea Party is going to announce this afternoon that they support a 33% cut in Social Security checks that will go out in August and forever after, their stance is not logical. Of course: in the process of allowing an increase in the debt ceiling, the Tea Party is certainly entitled to exact their pound of flesh from the current occupant of 1600 Pennsylvania Ave.
I WANT A TAX INCREASE
No, no: put down the pitchforks and torches. Sit down. Relax. Breathe. I am referring to a Gipper tax increase, not a Marxist-Leninist-soak-millionaires-and-billionaires-and-the-rich-and-ain’t-it-unfair one (and since when is an employed married couple earning $250,000 a year ‘millionaires’?). You young whipper-snappers weren’t alive at the time, so permit me to illuminate the former. Yes, RWR took the top income tax rate of 70% down to less than half that. To do that, however, he did something that would be considered a tax increase by the Tea Party. You could, at the time, fully deduct charitable contributions directly off of your Gross Income from your 1040 right off of the top even if you did not itemize; if you did itemize, you could also deduct the interest you paid on your credit card bills. These and many other popular tax dodges were simply eliminated. I think that Simpson-Bowles got it right: let us eliminate the tax deductions for home mortgage interest and state/local taxes. In fact, let us eliminate 1040 Schedule A altogether and all those tax deductions; in return, the top income tax rate will be reduced to 25%. In this case, the tax code will become flatter, fairer, and simpler. Even better, we will no longer be obligated to spend $100s billion on tax preparation services and accountants.
FOCUS, PEOPLE
For the first time since the days of Newt the Speaker, Republicans are actively trying to reduce the size and spending and tax bill of Uncle Sam. Republicans and their supporters should be celebrating, enjoying, encouraging and luxuriating: it should be a wet dream come true. Instead, the House leadership is persisting in their strategy of a circular firing squad. Removing Mr. B as the speaker would not be the worst outcome imaginable in the current situation (I vote for McCarthy, Ryan, DeMint, or Cantor, if I had won in 2010, that is).
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