DeMint has announced his resignation, not sure what his status is at this point (or when Scott will be sworn to replace him, beginning of next session I presume).

Kirk is expected to return to Congress later this week, nearly a year after suffering a severe stroke.

The 88 y/o Lautenberg has been out for several days, under doctor's orders to avoid the Capitol while recovering from the flu. Given the severity of the flu this year, I can buy that advice given the vote tally.

Thanks Mauchow for that-knew Rand Paul would be a no, and some of the others are no surprise either. DeMint wanted absolutely nothing to do with the vote so not surprised he didn't show up for it. Kirk is coming back next week to the Senate after a year away recovering from a stroke. The very interesting no vote here is Rubio-it most certainly will be used against him in any potential presidential bid.

I was thinking it makes him the most declared candidate for the GOP nomination.

And that too :)

The problem I have with this is that the top earners are going to get their taxes increased regardless of the deal. ObamaCare has a tax on the top earners (on all income), so the "Bush tax cuts" are expiring indirectly.

So if the taxes go up, you'll see total taxes go up to a total from anywhere of 7.8% to 8.8% depending on the classification of the income earned on the top income earners. That's a lot of money being given to the government from the top earners. I think it's now a 50/50 chance that we go back into a double dip recession.

Not to mention the payroll tax cuts weren't extended.


My whole problem with the Dems. SS is a lot easier to fix, but Medicare is the snake that no one wants to pick up.

If the deal is done as described, it's going to change the political scene. The class warfare card cannot be played the Dems anymore, now they have the deliver on their budget reform and moving to reduce the debt. The GOP will face a lot of challenges in their home districts over raising the taxes.

Dems, GOP and AARP. I've not been a watcher of AARP but it'll be interesting to see how this plays out over the next 2 months.

AARP releases 2012 voter guide - POLITICO.com

The big give in this is that it makes a lot of the Bush tax cuts permanent. That is why a lot of Republicans can vote yes on this. Grover considers this a tax cut, and that's how they'll run on it.

Thanks, Jon.

y/w

FWIW, I had no idea what the story was one way or the other until I looked it up. I just figured I'd see what I could find & that's what turned up.

Those tax increases are relatively small, and the top earners pay a lower tax rate than most of us here. If top earners are paying 23.8%, is it really bad? Most of us here are indirectly paying over 25%.

Then again, I am someone who supports a more flat tax structure.

Tea party is going to sabotage this again. If they do, maybe the President actually grows a back-bone and move that tax line back down to 250,000.

They'll have enough Republicans to pass it I'm guessing. Just a few who need attention in front of the cameras for the next 24 hours.

I don't think it is going up for a vote. With Cantor against it, Boner isn't going to allow a vote or it will be the end of his speakership. They may try to pass something with amendments, but that will never pass the Senate. This is all going to get punted to the next congress, and who knows what comes out then (not to mention what the markets are going to do when this all falls apart).

Agreed. I understand why they want to do this but it's not the right time. Do it in February and put it all on the table. Hold the country hostage then. As it is, you're going to screw over the people who already hate you even more and lose that many more moderate voters.

I guess I don't understand the system when things can be held from going up for vote. Isn't that sort of the point of a democratic government?

Been that way since the beginning.

esp. since we don't have a democratic government but a government of representatives of local jurisdictions, as varied as they have been and still are. A House representative that includes Boston would/should be very different than one from, say, Tulsa.

CNN just reported that House will vote on the Senate version, not the amended version.

Yeah, they aren't that dumb.

Done.

The past 3 days have been almost as exciting as the Presidential elections.

If you don't think that a 8.8% reduction in private income and out of the economy isn't going to have an impact-especially from the group who are the key investors, entrepreneurs, and money managers-I would disagree. Not to mention the deal doesn't extend the payroll tax cuts-which makes hiring and now more expensive-and ObamaCare fully coming online in terms of all of it's taxes and regulations, I worry. The deal and politics have been built on class warfare and ideology, not smart management and reality.

But the CBO estimates that this done deal will ADD $4 TRILLION to the debt. Yay! Go USA! Those politicians did it, and they're going to tell us how this deal will "save" the country.

I support a full flat structure. No deductions, everyone pays their "fair" share.

What a train wreck.

Just a little nuance, but the deal adds 4T from not passing anything, which would have taxes go up for all. Because it expired, it is a tax cut and adds to the deficit, but it raises money (I think 500B) from where it was.

Just trying to clarify, get back to talking about how much this hurts the benevolent job creators.

"Job Creators" have had it easy the last decade. Companies are making record profits and haven't done a damn thing with it, leading the economy to stagnate,

Well, some companies have done things with the record profits. They've bought out competitors and stripped them for parts.

While giving us products that we all thoroughly enjoy (I'm thinking of Apple and others)?

I've read two articles on this. CBO: 'Fiscal cliff' deal carries $4 trillion price tag over next decade - The Hill's On The Money


Easy doing what? They created products and services that people pay for. Why is this "easy?" Also, why is it a requirement for companies to do a "damn thing with it?" Companies and businesses aren't charity-it's about allocating their assets to generate returns for their shareholders (which includes your 401ks, pension funds, institutional investors, ect.).

If it makes you feel better, you can lower the taxes of the middle class to make up that 8.8%. My point was that the income tax system becomes regressive at a point and the middle class pay the large percent of their income to taxes. I'm not shedding tears for wealthier individuals who may need to pay 23% when most of us are paying 25-30%.

As for the payroll tax, that is a pass-through cost to employees. It won't have any impact on employers and hiring. It'll hurt salaries for employees.

Maybe this will at least remove any doubts about Paul Ryan as a pseudocon. He was about as useless as Malleable Mitt, except he seemed to have this weird Teflon coating about it.

And we still haven't touched out-of-control spending...

Oh no they are going to tackle that in the next Congress. :banghead:

On to the debt limit nonsense in a couple of months. Maybe we will increase it another 4 trillion and make 100-150 million really "tough" cuts.

Plus we need the evil corporations to maintain profits and growth so their stocks perform well for the various teachers pensions, universities endowment funds, non-profits charitable trust funds and ordinary citizens like you and me that have some shares or funds.

Yes, and I'm sure both articles said what the one you linked said:


So, yeah. Cost more than it would have if we went off the cliff. Duh.

They next big fight will be the sequester and the debt ceiling. What gets cut and how much gets decided in the next two months. Will there be a deal? Another minor bill and punt?

And who will be speaker? The word is now the far right has enough people that want Boner out that they might just block him. Will Cantor take that poison pill? Someone else?

Just need to make massive cuts to defense spending.

I'm for going to a chained CPI and looking at other such entitlement cuts, IF the deal is big enough. But it has to come from both sides. And of course, neither side will do anything more then posture until the last moment and beyond, because you ahve to please the adherents.

Dola: Wow, strong comments about the House refusing to pass Hurricane Sandy relief:

"These Republicans have no problem finding New York when they're out raising millions of dollars, they come to New York all the time filling their pockets with money from New Yorkers," he said. "I'm saying right now: anyone from New York and New Jersey who contributes one penny to congressional Republicans is out of their mind because what they did last night to put a knife in the back of New Yorkers and New Jerseyans was an absolute disgrace."

This person goes on to say:

"The Republican Party has this bias against New York, this bias against New Jersey, this bias against the Northeast,"

What makes these comments so strong? It's from the Republican congressman from New York, Peter King. The fault lines are showing right now....

An economist on NPR this morning stated that debt as a percentage of GDP has dropped over the past three years from about 10.8% to 5.5%, which seems like pretty good progress. I believe he said getting it to around 4% would make it quite manageable, so still work to be done to be sure, but to say it hasn't been touched seems inaccurate.

Yup. There needs to be large phased cuts in Defense, along with adjustments to entitlements (adjustments to the CPI for Social Security and fixes to Medicare). But the GOP wants everything to come from entitlements, and there are few adjustments to entitlements that the Dems are willing to make that Republicans are for. On top, I'm pretty sure that the President wants more revenue adjustments (updating the tax code) included in any spending cuts bill. Republicans are totally not going to want to do that now.

Then there is one other philosophical problem: The GOP is still more than willing to sabotage the good faith and credit of the United States by holding the debt ceiling hostage to get what they want. Obama is saying that he is not dealing on the debt ceiling any longer, and holding it hostage hurts the markets and the credit rating of the country.

Have you seen any pictures of Hillary lately? I hadn't really until over Christmas and both my wife and I said the same thing: "She looks like she has some sort of bad illness". My wife works at a hospital and she went so far as to suggest Clinton looked like she had cancer (wife's not a doctor or nurse, tho, so purely anecdotal). Whatever she's got, it doesn't look good and, frankly, any speculation I had at her running for President in 2016 ended when I saw those pictures.

SI

If you cut out defense spending completely, every last cent, you will have cut the deficit in half. Just $800 billion left to go!

Debt per year or total debt? We have to start paying this off eventually, or we'll be spending all our taxes on interest...

But that is not happening (baring some miraculous financial boom) in the next ten years. What we have to do now is start narrowing the deficit, by both increasing revenues and decreasing spending. I think the Simpson-Bowles 3 to 1 cuts to revenue is a good idea (though the plan itself was pretty bad). Reducing all spending across the board slowly over time, while increasing revenues also slowly, is the only responsible way to do it. Will it ever happen? Probably not.

Thank you DC, crisis averted. Pretty much solved!

Christie will be right behind him.

If so I hope King doesn't have food in his pockets, he could end up as collateral damage.

For those of you who want drastic cuts, where do you think they should come from? Because the three areas you have to cut would be SS, Medicare, and Defense. Areas that no one really wants to touch because the public oppose it.

I know there is a lot of "cut spending!" cheerleading, but no one can actually do it without ending their political career.

But herein lies the problem. Yes, there are 'fault lines showing' as you describe it. And there should be fault lines. But the fault lines are visible on both sides of the aisle, not just Republicans. Mr. King (or any other politician) need look no further than their spending and revenue decisions over the past 15-20 years as to why everyone didn't get what they wanted (including the Hurricane Sandy relief). Had they made the hard choices long ago, this wouldn't be an issue. Mr. Obama was the one who stood there and promised that all red tape would be removed and that everyone would get aid immediately. Before he (or any other politician) makes those kinds of promises on a public stage, maybe they should ensure that money is actually there to pay for those promises.

I'm amused (or saddened) by some of these articles stating who the political 'winners' and 'losers' were in this latest standoff. They're all buffoons and continue to show an utter lack of any form of leadership.

Reds hate the North, Blues hate the south. Thought that was pretty basic stuff.

That's not a reason to continue to be fiscally irresponsible. Term limits and a return to allowing all bills to go to the floor for a vote barring a verbal filibuster would be a good step in that direction.

Except for 1 man businesses, i think, which probably impacts millions.

But the public overwhelmingly elect people to be fiscally irresponsible. We don't want responsibility out of our elected officials, so why exactly do we think we're going to get it?

By all means, let's remove the increasingly rare instance of a decent Congressman.

I've never been better represented in DC in my life (imperfect as even my Rep. may be), I'd be loathe to force him out against the will of the people he represents due to some arbitrary calendar restriction.

That smells of the very things that contributes considerably to our national downfall: celebration of mediocrity + punishment/resentment/hatred of success

They pay the same rate. They are actually in a better position because they can pay themselves a lower salary, count the rest as profit sharing, and avoid paying payroll tax on that amount. They also can take advantage of big retirement options that employees don't have to dodge taxes right now.

Missouri has term limits at the state level and has produced a balanced budget for several years running. Given how badly the federal government and multiple states have gone off the rails during this time, I think they've done quite well.

I'd certainly agree that decent Congressmen are exceptionally rare right now.

Oof. Christie doesn't just bring the heat, he brings the flamethrower:

Selected quotes:

"There's only one group to blame for the continued suffering of these innocent victims: The House Majority and their Speaker, John Boehner."

"We respond to innocent victims of natural disasters not as Republicans or Democrats, but as Americans. Or at least we did, until last night. Last night, politics was placed above oaths to our citizens. To me, it was disappointing and disgusting to watch."

"Last night, the House of Representatives failed that most basic test of public service and they did so with callous indifference to the suffering of the people of my state."

"This should be a no-brainer for House Republicans."

"This was good enough for 62 Senators ... this was good enough for a majority of the House of Representatives ... it just could not overcome the toxic internal politics of the House Majority"

"New York deserves better than the selfishness we saw on display last night. New Jersey deserves better than the duplicity we saw on display last night. America deserves better than just another example of a government that has forgotten who they are there to serve and why. 66 days and counting. Shame on you — shame on Congress."

BTW, even more on where that number comes from:


So, almost all of that deficit reduction would have come from a huge tax increase. Is that what you where looking for? This whole "deal increases the deficit" thing is so disingenuous it is ridiculous.

Wasn't the 2012 deficit like $1.6 trillion, making that even worse?

The way it was SUPPOSED to happen was for both sides to take a hit: raise taxes, cut defense for the Republicans, and cut SS/Medicare for the Dems. Then both sides can point at each other in the next election and even it out. Instead we go back to the usual schemes and keep driving us to an even worse financial place.

Boner is resigning tonight according to MSNBC.

I still don't get the Boehner flame war here. Maybe I just have a bad read on the situation, but I've always felt he was ready to deal but in danger of getting strung up by the right flank of his party.

SI

Republicans don't want to cut SS or Medicare. Sure there are a few on the fringes that do like Ron Paul, but they are an extremely small part of the party.

A Speaker of the House who can't get things through his party is basically worthless.

Good riddance.

Sure, but let's say Cantor takes over. What is he going to be able to get done? He represents a group that wants things that can't pass the Senate or a Presidential veto. You either have to risk your own party's wrath and cut last second deals to save face or, well, do nothing.

SI

I haven't seen that anywhere, personally. I think MSNBC might have jumped the gun but I could be wrong.

SI

Yup. It is political suicide to raise taxes/cut popular programs. But, if everyone did it, then you could see a world where the suicides kind of canceled out. It was a decent enough attempt at something. Sorry that it didn't work.

1.1 trillion according to the CBO.

So, does anyone know why the Sandy aid didn't come to a vote in the House? Was it just a personal preference of Boehner? Are they punishing Christie for supporting Obama? Is there something in the bill the House Repubs don't like?

The way it was presented, the house felt it was too much money (wanted something to offset the 60B costs) and that FEMA had enough money to help the area out for 1-2 months while they figured it out.

It will be voted on today or tomorrow with a stopgap funding of 9B, and the new congress will vote on the remaining 50B.

I must be missing something in the Sandy debate - what were the total losses? I know insurance was responsible for like $30 billion, and I know that doesn't cover the total losses, but is it really $90 billion for the government to be throwing an additional $60 billion at it?

It's the GOP and their "everything must be offset by cuts somewhere" mentality right now. It's good to pay for things. It's not good when you can't pass a budget from year to year to try to account for these things or trust to get it done next year. But no one wants to pass an actual yearly budget because of all the political third rails.

SI

The problem as I see it is he's effectively 'speaker' for two different parties:

Firstly he's the speaker for the moderate Republicans who are willing to deal and find a compromise/best solution for issues.

The 'second party' he speaks for who are more "Tea Party-esque" Republicans who have no interest in finding a middle ground and who are numerous enough to cause real problems. These individuals see themselves as elected because they have this stance and so view any compromise as potentially threatening their jobs ... as such they'd generally prefer to cause gridlock rather than allow anything but what they want occur.

Boehner (in my eyes) has tried to pander to both camps - but is more biased towards the first.

If the next 'Speaker' is more entrenched with the second then chances are nothing will happen anyway because of their general ideology (ie. all or nothing) and its distance from potential middle ground where compromise might be found ......

I believe the insurance losses don't cover all the infrastructure damage.

And flood insurance only covers a max of $250K in losses. Not many of those houses destroyed were worth that little. I don't know for sure, but some of the aid may be going towards making some of those people whole, or close to it.

But, on othe other hand, if Cantor can deliever votes, you can make a deal with him. With Boehner, even if you make a deal, you have no clue if that's going to work - so what's the point in even negotiating with him? You may have to work harder and it may be more difficult with Cantor, but when you agree - you have something.

There are no GOP electoral votes in the region, so fuck em.

Obama Sandy aid bill filled with holiday goodies unrelated to storm damage - NYPOST.com

What's wrong with any of this?

The fisheries are the really odd thing in the story. Other than that, it's at least tangentially if not materially related to the storm.

SI

It was a MSNBC reporter citing a source from the speakers office. He obviously got it wrong, or Beohner was encouraged not to. There is still threats (Fox has 20+ congressmen saying they don't want to vote for him), but unless Cantor says he wants, they'll probably be no challenge.

I think maybe Ted Sevens' corpse still has power in Washington.

I mean seriously, I hate Congress. Who tries to sneak the fisheries deal in? Let's go make them watch that Rutgers/Virginia Tech bowl game over and over again.

Yeah, the only way anything substantive happens is if both parties truly compromise & take some flack from their respective bases. The fiscal problems we have are too big for one party to come out looking good to their base.

We have to cut spending AND raise taxes past the point that anybody really will "agree" with. It really isn't an option at this point & we cannot (and should not) rely upon flowery economic predictions (read: pure speculation/gambling) to make the numbers appear better than is reasonable based on the past 4-5 years of data. Thats been "good enough" in decades past as we've simply kicked the can down the road but the road does have a (practical) end to it.

And if (a very big emphasis on if) we make these cuts & tax increases, and find that the economy begins booming to the point that our updated deficit/debt projections are pulled in dramatically, then we can restart the (philosophical) debates about whether we should add entitlements back or reduce taxes from that point.

But this type of stuff doesn't get done by both parties believing they can look good for it. They simply cannot. Unfortunately, this is a time for adults to make adult decisions and all we have are invincible teenagers negotiating.

We don't need to slash and burn spending. Austerity doesn't work. Look at the European countries that have tried it.

What we need to do is reform Medicare/Medicaid and spend smarter so that they're sustainable. Note that I'm leaving SS out of this because it doesn't contribute to the debt, but the principle is the same there.

But radically slashing domestic spending in the name of "austerity" and "trying to get our debt bill in order" is the wrong thing to do at this point in an economic cycle. It needs to be done at some point, yes. Obviously. But cutting too much right now (or in the wrong places) will just send us back into a double-dip recession.

But it's all relevant. If we reform SS to be more efficient, there will either be more money going towards our SS payout or (heaven forbid) a reduction in our contribution. Either way, that puts more money in the economy instead of being burdened by another social program.

Burdened? Such a shitty choice of words there (although yes, I agree with the rest of your post, which is why I included a mention of SS, just wanted to note again that it doesn't directly contribute to the debt).

Sorry if this was posted elsewhere in the thread:

Fiscal Cliff Deal Sneaks In Wall Street Gifts, NASCAR Perk

I wonder what the real effective tax rate increase is when you figure in the tax breaks and perks that have to go in to get it passed.

Social security is ridiculously efficient with 0.9% administrative costs. My previous employer and I were paying close to that in fees for my 401k with a much lower set of problems with the user base (i.e. Social Security applies to all, rich and poor- not just those working for a Fortune 500 company).

It should be held up as a model of government being much more efficient than the private sector and not some mindless thing to be indiscriminately put on the chopping block because NEED MOAR TAX RELIEF. Adjust it to make it solvent and then leave it the eff alone (and, for the love of god, stop borrowing from it or having "payroll tax holidays").

SI

Of course the same could be said for medicare. It is way more efficient and cost affective than private insurance, but the GOP would rather shoot their grandma than admit that. And then the greatest example of government waste and cronyism is the defense budget, but that can only be allowed to rise.

What's wrong with any of this? So you have no problems adding millions, tens of millions or even billions to already overestimated expenditures because they can and they make political contributors and lobbyists happy? No wonder we are in this mess.

What I've never understood is that if there's no hurry to cut any spending in any significant way, why is it so urgent that we get money out of people's incomes? A higher tax is just like spending less. Except that you're taking money from people's incomes and the economy. I can understand the desire to attack the problem with both taxes and cutting spending, but not the urgency to do just do one or the other, and definitely not the urgency to raise taxes when the national debt problem is simultaneously downplayed. The push for taxes has never been vocally about reducing the deficit, it's more about people "paying their fair share", a more moral/social kind of argument.

Agreed. It's more pandering rather than addressing the core issue that revenue - expenses = 0 if you're doing it right.

I like Buffet's idea that if the budget doesn't balance to a certain percentage of GDP, all congressmen face an immediate recall in the fall. If they can't do their job, their job needs to be on the line.

adjusting it to make it solvent for more years is what i was talking about by "fix" it btw.

+1

Sometimes doing your job right means running up large deficits though. I did a bit of reading about debt to GDP yesterday in response to someone's question to me. There have been a few times where we ran up huge deficits in the past 112 years, mostly in response to wars and to a lesser degree economic downturns. Where we seem to have failed over the past 32 years in contrast to other times in the 80 years before it is not doing a good job of paying down the debt when we've had prosperous times (with the exception of the Clinton / GOP congress era to some degree).

There's much I don't understand from the raw numbers I've seen that I wouldn't feel comfortable pulling them out for a debate, but the general logic (spend out of a downturn to get people back to work (and thus increase revenues), pay down debt when the economy is rolling, do not let debt-to-GDP get to dangerous levels where you can only pay the interest with what you're making) seems sound to me.

Boehner gets enough votes to remain Speaker of the House.

Social security should be as insurance should be if it were not-for-profit. Take a really thin slice off the top for administrative costs (less than 1% works). Then the rest of it should be totally self contained: make adjustments to COLA or tax changes to keep it solvent on the 75 year plan and then leave it alone. If it could be spun off as its own not-for-profit arm, so much the better.

SI

Exactly. So now we're screwed, and have to do something painful to get out of it one way or another. How many years are we supposed to wait for this recession to end for us to start paying it down again, when we're already at 5+ years of revenue in debt?