Congress is deadlocked on a host of issues that will need to be solved before the end of the year lest the country plunge off a fiscal cliff at the start of 2013. If no action is taken, all of the Bush tax cuts will expire, the payroll tax will return to higher rates, and the full-sequester spending cuts will go into effect, with the debt ceiling hitting its limit shortly thereafter. Estimates from the Congressional Budget Office released early this week paint a horror story for the start of 2013, with the economy contracting by 1.3 percent.
In our last episode, dear viewers, we watched as Israel's main opposition party, Kadima, sold out its centrist voters and joined Benjamin Netanyahu's government—thereby providing the prime minister a reprieve of over a year before he must face the voters. This allows Bibi more time to raise regressive taxes, evade negotiations with the Palestinians, and deride diplomatic efforts to solve the Iranian nuclear issue.
When it was discovered that the General Services Administration spent nearly a million dollars on a lavish conference in Las Vegas, the outrage thundered through Washington like a roiling tsunami. Congressional hearings were quickly organized, the scandal led the news every night for days, and you couldn't turn on a television or radio without hearing more horrifying details. The public trust was betrayed! Our tax dollars were wasted! Government was out of control! Yeah, maybe. But in the end, the whole thing was about $823,000, or .00004 percent of the federal budget for 2011. You want to talk real government waste? Get a load of the F-35 joint strike fighter...
In the latest issue of the magazine, I have a piece examining a strange and growing trend in some conservative circles—pushing states to adopt alternative currencies to the federal dollar. The basic concern is one you've probably heard from Ron Paul: The Federal Reserve can't be trusted, the national debt is out of control, so the U.S. dollar, backed only by faith in the government, may become worthless. (The story outlines some of the more obvious economic problems with this theory.)
To deal with the concern, problem-solving state lawmakers have started introducing bills to create a second currency, one of gold and silver. Sounds like a fringe concept right?
As much as the Internet might try to fool you, the 2012 political season is about more than just Etch A Sketches and sweater vests. We’re up crap creek in a leaky canoe when it comes to the economy, and as the country heads into the general election, the debt and budget will be at the fore of public debate.
With competing budget proposals flying in from all sides, much of the political talk these days centers on the endless delays and extensions that Congress has thrown in the path of approving a long-term federal budget. Which might lead one to wonder: Would it matter if we never passed a budget plan ever again?
What exactly is the federal budget?
The federal budget is one big ’ol nasty bill thousands of pages long that determines the fiscal future of the country over the course of a year by allocating money to various programs like Medicare and Medicaid as well as to things like defense spending.
When was the last time we had a budget bill that was approved?
April of 2009. But technically it was just an “omnibus spending bill,” and President Barack Obama was none too thrilled to be signing it, citing the excessive number of earmark projects. The following year, Democrats chose not to put forth a budget bill because they deemed it politically imprudent during the hotly contested midterm elections. Same thing happened the next year. You get the point.
Mitt Romney's old ski lodge, aglow with the warm light of taxpayer subsidy.
Like a good liberal, I feel a tiny pang of guilt when I do my taxes every year and see how much the government is subsidizing my choice to buy a home. Not that I'm going to turn it down as long as it's in place, but the mortgage interest deduction is not easy to justify. Even if there are reasons to believe that homeownership is a good thing, that doesn't necessarily mean that the government should pay you thousands of dollars to do it, particularly when you were probably going to do it anyway.
One of the more frustrating aspects of this year's Republican primary was the utter lack of specificity in candidates' proposals. It turns out this was a strategic decision. In an interview with the Weekly Standard last month, Romney said:
This piece is the fourth in a six-part series on taxation, and a joint project by The American Prospect and its publishing partner, Demos.
The “Buffett Rule” proposed by President Obama and now being considered by the Senate would be an important symbolic step toward a fairer tax system. By instituting a minimum tax on very high earners, it would advance the principle of progressive taxation and reform the tax code in an overdue way.
Paul Ryan's budget has become a rallying cry for Democrats, and President Obama's re-election in particular. Republicans have long expressed an antipathy for the general concept of government services, but these were often expressed in the abstract or lone exceptions, with the party generally focusing on the starve-the-beast philosophy of reducing taxes so that government outlays would eventually have to be reduced. Ryan's budget gets that down on paper in crystallized form, codifying those ideas into a specific vision for the future that would gut all government services except health spending, Social Security, and an increased budget for defense, discarding the rest of discretionary spending.
Democrats are doing everything they can to make the Buffett Rule as the predominant issue of the week before it is subjected to a Senate vote on Tax Day. The rule—named after Warren Buffett's frequent refrain that his secretary pays a higher effective tax rate than the multi-billionaire investor—would force multimillionaires to give up some of their tax breaks until they pay at least a minimum rate of 30 percent. Obama is headed to Florida tomorrow to promote the bill, while his campaign is highlighting the rule as a campaign issue in contrast to Mitt Romney's tax disclosures he released earlier this year, which revealed that the probable Republican candidate paid taxes of just 13.9 percent on his $21.7 million in income in 2010.
Via Ezra Klein, here are handful of charts from the Center on Budget and Policy Priorities that perfectly captures how Paul Ryan's budget would essentially wipe out all government services for those in need in order to fund a massive redistribution of wealth back up to those at the top of the income scale.