Wednesday, December 12, 2012
A Glimpse of the Fiscal Future
By Alan Caruba
A recent Rasmussen poll indicated that 53% of likely voters still think Obama is doing a good job. And that’s the bad news.
A majority—though a slim one—reelected Obama, but in a democracy that’s enough. As for myself, if I were a psychiatrist, I would have to conclude that I have been clinically depressed since November 6, 2012. In truth, anyone reading my daily commentaries knows that, so far as the future of the nation is concerned, I have been in a very bad mood for many years, but the pace picked up when Obama was reelected.
A torrent of words have been written and spoken about the “fiscal cliff”, a term referring to the largest increase and expansion of taxes in the nation’s history that will occur on January 1, 2013. We live in a nation with an insane $16 trillion debt and a deficit that requires the U.S. to borrow $4.8 billion every single day just to keep paying the interest on the debt and keep the government functioning.
It’s like being in a bullring and only having a spoon to defend yourself as the beast charges in your direction.
Kimberly A. Strassel, a columnist for The Wall Street Journal, has one of the sharpest minds when it comes to politics. On December 7th, she had some thoughts about “Obama’s Famous Tax ‘Victory’” and they are worth sharing in part. “To read the current fiscal-cliff coverage,” said Strassel, “President Obama holds the upper hand is poised for the ‘victory’ of winning an increase in tax rates”, but “few have stopped to consider how paltry that victory is likely to be. For a short-term win on this ideological issue, President Obama may well cede most everything else.”
Putting it in perspective, Strassel noted that Obama “has argued his entire presidency that America’s debt hole could be filled by soaking the rich. He’ll now get his way, in a bill that likely provides $800 billion in revenue over 10 years, or $80 billion a year…that’s 7% of the $1.1 trillion deficit Mr. Obama ran in fiscal year 2012 alone.”
Sequestration will require a number of cuts to domestic and defense spending, but the nation’s debt is not going to go away without substantial reforms to the tax code and the so-called “entitlement” programs, Social Security and Medicare. The name applied to them is typically misleading. They are not entitlements because workers are required by law to pay into them and are, in theory, only getting that money back when they become senior citizens or ill. I say, in theory, because they are going broke to a point where they may cease to exist without changes.
As for taxing “the rich”, the income that will generate will only pay for about a week’s worth of what the government is presently spending.
Then, on January 1, says Strassel, “He then faces four years and 20 days of a presidency marked by his ownership of a faltering economy, a spiraling debt problem, automatic sequester cuts, no prospect of further spending or tax revenue, and a debt-ceiling bomb. If that’s the president’s idea of ‘victory’, maybe it’s what he deserves.”
And maybe what Americans deserve for electing and reelecting him to the highest office in the land without the mainstream media never once vetting his resume for the job or the truth about his life, his affiliations, and his ideology. If Obama had been a Republican, he would have been savaged for the past four years for his many failures regarding the economy and a foreign policy that has seen the Middle East turn into a region that threatens the peace of the world. The scandals of “Fast and Furious” and Benghazi have been swept under the rug while those who voted for him watched “Glee” and “Dancing With the Stars.”
If you want to better understand what has gone terribly wrong with America, I recommend you read Stephen Moore’s new book, “Who’s the Fairest of Them All? The Truth about Opportunity, Taxes, and Wealth in America.” ($24.95, Encounter Books)
Moore, who is a member of the editorial board of The Wall Street Journal and a frequent guest on Fox News, asks the following questions:
Is it fair that some companies that produce electricity from wind and solar power and ethanol get hundreds of millions of dollars of subsidies and pay virtually no taxes, while the oil and gas industries that provide twenty times as much energy pay tens of billions of dollars of taxes?
Is it fair that those who work forty, fifty, and in some cases, sixty hours a week to make ends meet, have to pay taxes to support an unemployment insurance system that pays those who haven’t worked in two years?
Is it fair that big banks got huge government subsidies because they bought trillions of mortgage-backed securities, but the small community banks they compete against got nothing?
Is it fair that federal employees receive pay and benefits that are nearly double the pay and benefits of the private sector workers who pay their salaries?
Is it fair that the richest 3 percent of taxpayers now must pay more in federal taxes than the bottom 97 percent—and yet they are disparaged for not paying enough taxes?
Is it fair that after the first two years of Obamanomics, the poor are poorer, the middle class has shrunk, and median incomes have fallen?
Is it fair that nearly four out of ten American households now pay no federal income taxes at all?
No, it is not fair, but one of the President’s themes throughout his first term and during the 2012 campaign was about fairness. It made sense to a lot of people who have no idea how their lives, their investments, their savings, their medical care, and their future has been put in jeopardy in his second term and for many years to come if major reforms are not made.
If the record of Congress is any indicator, they will not be. Now that you have looked over the cliff at the future, perhaps you may have cause to be as depressed as I am.
© Alan Caruba, 2012