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Republicans’ Love for the Wealthy Has No Bounds

December 4th, 2012
Wow. Talk about obstinate:
House GOP leaders endorsed a debt-reduction plan Monday that would raise tax collections by $800 billion over the next decade, but they refused to budge on higher tax rates for the wealthy, the central issue dividing Republicans and Democrats.
The Republicans' “middle ground” plan? They agree not to slash taxes for the rich yet again, they agree to go forward with their own nebulous and undefined plan to somehow cut deductions as a way of “taxing” wealthy people, and in exchange, Democrats must agree to $600 billion in cuts to health programs and hiking the eligibility age for Medicare from 67 to 69. That's a “middle ground”? “Give us most of what we want anyway”? With this plan, the Democrats get nothing they ask for, and the Republicans get mostly stuff they campaigned on. They lose a major election that they should have won by wide margins primarily because of the issue of income inequality. The general public widely supports the new tax on income over $250,000, and hates the idea of health care cuts. The president is re-elected despite high unemployment rates and a struggling economy mostly on the strength of this issue, which also leads Republicans to lose the popular vote in all areas, maintaining the House only by gerrymandering. And still, they think it's a good idea to crash the economy instead of raising taxes on the wealthy by a measly few percent. Holy crap. I can only figure that they plan to run down the clock, hoping the Democrats will blink. However, Obama, usually the first to compromise, is actually standing firm on this one. I am hopeful of the eventual outcome—I believe that Republicans will hold out until just before the end, that Obama will stand firm, and at the last minute the GOP will cave, at least mostly. The problem is, this game they're playing will likely damage the nation's economic standing, just like it did last time.

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  1. Troy
    December 5th, 2012 at 07:23 | #1

    it’s all a joke here and going to end badly.

    if anything, Japan is looking a bit more saner.

    – a bit.

    Japan has a ¥90T national budget, call it $1T.

    That’s nothing . . . $8000 per capita. ¥22T of that is interest payments, most of which go directly to Japanese people, so deducting that and the per-capita expense is $6000.

    The US has a $3.8T budget, but $700B of that is transferred to the states to spend.

    The remaining $3.1T is around $10,000 per capita. Total spending (all levels) is $6.4T, over $20,000 per person!

    It’s really astounding that government is spending $20,000 per capita here. For a family of 4, that’s $80,000! How is that even possible???

    Well, Denmark is spending $23,000 per capita, but they a) actually have a fully-functional social-welfare system, and b) have a 50% tax-to-GDP ratio, while the US’s is about half that.

    Like the US, Japan simply has to raise taxes, a lot. Theoretically these higher taxes will come out of rents and home prices, but that’s only theory.

  2. Troy
    December 5th, 2012 at 07:56 | #2

    http://www.mof.go.jp/english/budget/budget/fy2012/e20111224c.pdf

    is an interesting report on Japan 1990-2011 that I’m going to look at more tonight.

    The beauty of Japan is that the bulk of the expenses going forward are just social spending (going right back into communities and local jobs) and interest payments (going to many people who have savings and need the money or can apply the payment against higher taxes if they are higher earners).

    I’d like to think Japan is going to do OK this decade and next.

    The US, on the other hand . . . man. We’re so screwed up we can’t even see HOW we’re screwed up.

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