30 December 2012

The Nekkid Truth as America Approaches the Fiscal Cliff

As politicians on both sides of Pennsylvania Avenue perform the strip tease regarding the avoiding Fiscal Cliff, it is worth stepping back to chuckle and simultaneously smirk at what brought us here.

In late November, "nekkid" protesters who could have been typecast out of the Occupy Wall Street sit-ins, albeit better bathed and sans clothes, decided to demonstrate in Speaker John Boehner's office regarding cuts from the sequestration


When commenting on the Capitol Hill streaking spectacle, former Senator Alan Simpson (R-WY) quipped at a Christian Science Monitor luncheon about the difference between being "naked" and "nekkid".  Obviously from the messages on their backs, they were up to something.

During his successful 2008 Presidential campaign, candidate Barack Obama promised to double spending on world AIDS prevention from its FY 2009 level of just over $20 billion to $50 billion.  In FY 2009, the last year the Democrats in the Senate deigned  to do their duty and pass a budget, AIDS funding increased to $25 billion.  Since both President Obama's subsequent budgets failed to get a single vote and Senate Democrats did not approve a budget, AIDS spending went from $23 billion to close to $24 billion.  Yet the nekkid "happening" was at Speaker Boehner's office allegedly to protest a 10% across the board spending cut.

Out on the 2012 campaign trail, President Obama urged raising taxes on the top 2% of taxpayers (who currently pay 45% of all taxes) from the Bush tax tables which was supposed to raise $800 billion over time.   But the nekkid truth is that once Mr. Obama was re-elected, his naked ambition was to double revenues to $1.6 trillion, along with another stimulus package, the ability for the Executive Branch to unilaterally raise the debt ceiling and without any spending cuts in the first eight years of the ten year plan.

Republican have been desperate not to take the blame for going off the Fiscal Cliff and have further draconian cuts to an already emaciated armed forces along with resuming Clinton era tax rates with Obama era federal spending.   Prior to Christmas, Speaker Boehner was even willing to adopt Rep. Nancy Pelosi's proposal of raising taxes on true millionaires (not those making $250,000), but "Plan B" was summarily rejected by Democrats and more importantly by the important tea party elements of the GOP caucus, who were not anxious to take the blame for willingly raising taxes.

Typical of his governing style, President Obama had a hands off approach to budget negotiations when he went on his Hawaiian holiday.  When the President showily returned to the District of Calamity for budget talks, he gathered politicos for a photo op, offered nothing new and dictated how Congress should legislate by demanding an up and down vote, which might not even carry the upper chambers majority caucus.

Speaker Boehner called back House Members on Sunday afternoon in case there was a legislative compromise.  Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY) have tried to craft a last minute compromise.  It would not be surprising if the proverbial can gets kicked another month down the road.

But the naked truth is  that Americans (even the top 2%) are not undertaxed, but that the federal government is spending too much. Unless politicians on Capitol Hill and the White House make real spending reductions, the US will not just go over the fiscal cliff but we will go into the abyss which would drive a world-wide depression, significant currency devaluation, inflation and devastating cuts in an already weakened military still on a war footing and no money  for discretionary programs like world AIDS funding et cetera.

So expect lawmakers to realize that they are "nekkid" and find a fig leaf.  The problem is that such a fig leaf of a plan essentially covers nothing and may get everyone banished from the land of the free and the home of the brave.  Is that what we really want or what we voted for in November?

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