Bankrupting America’s Spending Daily

| December 3 2012

Spending Daily | December 3, 2012

 

Obama “unyielding” in Fiscal Cliff Talks
Peter Baker writes in The New York Times, “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. … 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. … Either way, the two sides were left at loggerheads over the weekend with less than a month until a series of painful tax increases and spending cuts automatically take effect, risking what economists say would be a new recession. Mr. Obama refuses to propose more spending cuts until Republicans accept higher tax rates on the wealthy, and Republicans refuse to accept higher tax rates on the wealthy while asking for more spending cuts.”

Samuelson: “Put Social Security on the table”
Robert J. Samuelson editorializes in The Washington Post, “Put Social Security on the table — clearly and irrevocably. Protecting retiree benefits is the left’s political equivalent of the right’s ‘no new taxes’ pledge. Congressional Republicans are abandoning their untenable position. Now it is time for President Obama and congressional Democrats to do the same. As long as they don’t, they aren’t bargaining in good faith, or in the national interest. Supporting retirees is now the federal government’s main activity. There’s a huge redistribution from young to old — a redistribution that will be made worse if retiree programs are largely excluded from deficit reduction, as many liberal groups urge. Either taxes will rise steeply or other federal programs (defense, food stamps, environmental protection) will be cut sharply. The young will pay more and get less. Or, given these unpalatable choices, true deficit reduction won’t happen.”

Real Compromise Necessary for Fiscal Cliff Deal
Thomas Fitzgerald writes in The Philadelphia Inquirer , “In a cartoon ricocheting around the Web, the conservative antitax crusader Grover Norquist is depicted as the disembodied head of the Wizard of Oz – a green, glowering face floating above Republican politicians bowing in reverence, the entire scene lit by votive torches. … They say Norquist’s power – stemming from an ironclad ‘no tax’ pledge most GOP lawmakers have signed – has all but ruled out rational discussion and compromise. … ‘It’s unhelpful for either side, Democrat or Republican, to say that something is completely off the table,’ said Lenwood Brooks, policy director of Public Notice, a nonprofit advocacy group pushing to reduce the deficit and debt. ‘At the same time, no tax increase out there is going to be capable of solving a $1 trillion deficit. You need spending cuts.’ (Even Obama, in his 2009 State of the Union address, [said] that there could be no long-term fiscal stability without reining in the growth in entitlement costs.)”

“Things are getting worse” in Fiscal Cliff Negotiations
Jake Sherman writes in Politico, “Here’s why you should be concerned about the state of play in the fiscal cliff negotiations: Things are getting worse. Not only is the proverbial precipice approaching, there’s a solid logjam and no momentum toward breaking it. … Besides a few errant House Republicans that have no role in the negotiations, no one is champing at the bit to hand Obama a win by extending the middle-income tax rates. Publicly, and even privately, Senate Democrats are not pressuring Majority Leader Harry Reid (D-Nev.) to cut a deal with Obama to avoid a long, dragged-out fight. So the question is this: Where will the thaw come from, and what will cause it? Time is running out. Each hour over the next four weeks — 19 business days — will be crucial. Aides privately fret that a deal needs to come together soon. It’s not only tax rates that have to be decided and prepared, but also spending cuts, unemployment insurance, farm policy and renewal of Medicare policy that will need to be Velcroed into a deal.”

Boehner on Fiscal Cliff: “We’re nowhere”; “flabbergasted” by White House Proposal
The Washington Post reports, “As the White House and Republican leaders enter the final month of negotiations to avoid a year-end ‘fiscal cliff,’ both sides struck an uncompromising tone Sunday, as warnings mounted that they will be unable to forge an agreement to stop an automatic series of deep spending cuts and large tax hikes that could push the economy into recession. … ‘Right now, I would say we’re nowhere, period. We’re nowhere,’ House Speaker John A. Boehner (R-Ohio) said on ‘Fox News Sunday.’ Boehner added that the Republicans have offered a way to break the stalemate — by compromising on an overhaul of the tax code that would limit deductions that disproportionately benefit the rich. … Last week, in a private meeting with Boehner, Geithner made the Obama administration’s opening bid in the fiscal cliff talks — largely a reprisal of policies the administration has already advocated. In addition to $1.6 trillion in new tax revenue, the proposal called for $600 billion in spending cuts, a majority of it from Medicare and Medicaid, as well as a new policy to allow the president to raise the statutory limit on federal borrowing without a majority of Congress approving. … Republicans dismissed the proposal as laughable. ‘I was flabbergasted. I looked at him and said, ‘You can’t be serious,’ ’ Boehner said Sunday. ‘I’ve just never seen anything like it. You know, we’ve got seven weeks between Election Day and the end of the year, and three of those weeks have been wasted with this nonsense.'”

Both House and Senate Passed Bills to Delay Tax Increases, Avert Fiscal Cliff
The Associated Press reports, “It may not sound like it from the rhetoric, but both the House and Senate already have passed separate bills to delay big tax increases awaiting nearly every taxpayer next year if Congress and the White House can’t agree on a plan to avert the ‘fiscal cliff.’ The Democratic-controlled Senate passed a bill in July that would extend many of the expiring George W. Bush-era tax cuts for middle-income families, while letting taxes go up for individuals who make more than $200,000 and married couples making more than $250,000. The Republican-led House passed a bill in August that would extend the tax cuts for just about everyone.”

41 Percent of SpenObama Voters Favor Spending Cuts to Control Deficit
Politico reports, “The coalition of voters that gave President Barack Obama a second term splits over how to reduce the deficit, according to a poll released Monday. A survey of 800 Obama voters, conducted last month by Benenson Strategy Group for the moderate Democratic think tank Third Way and shared first with POLITICO, finds that 96 percent believe the federal deficit is a problem and that 85 percent support increasing taxes on the wealthy. Yet 41 percent who supported the Democratic incumbent want to get control of the deficit mostly by cutting spending, with only some tax increases, while another 41 percent want to solve it mostly with tax increases and only some spending cuts. Just 5 percent of Obama supporters favor tax increases alone to solve the deficit, half the number who back an approach that relies entirely on spending cuts.”

“Obama seeks Aug. 1 deadline for tax reform”
The Washington Post reports, “President Obama is seeking an Aug. 1 deadline for overhauling the tax code and making changes to expensive federal health programs, the final pieces of what the administration conceives as a far-reaching plan to rein in the national debt, senior administration officials said Friday. The proposed deadline was included in a plan Treasury Secretary Timothy F. Geithner delivered to Capitol Hill on Thursday as Obama’s opening bid in talks with congressional Republicans to avert the year-end ‘fiscal cliff.’ That plan generally mirrors previous deficit-reduction plans Obama has submitted to Congress. In all, it would reduce borrowing over the next decade by $4.5 trillion, officials said. However, Obama is proposing to dedicate about $200 billion of those savings to new measures to boost the sluggish economy, including additional unemployment benefits and extension of a temporary payroll tax cut for most workers.”

“Brinksmanship on Obama Medicaid Expansion for Poor”
The Associated Press reports, “It’s health care brinksmanship, with hundreds of billions of dollars and the well-being of millions of people at stake. President Barack Obama’s health care law expands Medicaid, the federal-state health program for low-income people, but cost-wary states must decide whether to take the deal. Turn it down, and governors risk coming off as callous toward their neediest residents. Not to mention the likely second-guessing for walking away from a pot of federal dollars estimated at nearly $1 trillion nationally over a decade. … Back in Washington, Health and Human Services Secretary Kathleen Sebelius says states can take all the time they need to decide. They can even get a free trial, signing up for the first three years of the expansion and dropping out later. But she hasn’t answered the one question that many states have: Would the Obama administration allow them to expand Medicaid just part way, taking in only people below the poverty line? That means other low-income people currently eligible would be covered entirely on the federal government’s dime, and they would be getting private coverage, which is costlier than Medicaid.”

BankruptingAmerica.org is an educational project of Public Notice, an independent, nonpartisan, non-profit, 501(c)(4) organization dedicated to providing facts and insight on the effects public policy has on Americans’ financial well-being.

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