Reich writes: "I can't help believe the President could have done better than this. After all, public opinion is overwhelmingly on his side. Republicans would have been blamed had no deal been achieved."
Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)
Lousy Deal on the Edge of the Cliff
01 January 13
he deal emerging from the Senate is a lousy one. Let me count the ways:
1. Republicans haven’t conceded anything on the debt ceiling, so over the next two months - as the Treasury runs out of tricks to avoid a default - Republicans are likely to do exactly what they did before, which is to hold their votes on raising the ceiling hostage to major cuts in programs for the poor and in Medicare and Social Security.
2. The deal makes tax cuts for the rich permanent (extending the Bush tax cuts for incomes up to $400,000 if filing singly and $450,000 if jointly) while extending refundable tax credits for the poor (child tax credit, enlarged EITC, and tuition tax credit) for only five years. There’s absolutely no justification for this asymmetry.
3. It doesn’t get nearly enough revenue from the wealthiest 2 percent - only $600 billion over the next decade, which is half of what the President called for, and a small fraction of the White House’s goal of more than $4 trillion in deficit reduction. That means more of the burden of tax hikes and spending cuts in future years will fall on the middle class and the poor.
4. It continues to exempt the first $5 million of inherited wealth from the estate tax (the exemption used to be $1 million). This is a huge gift to the heirs of the wealthy, perpetuating family dynasties of the idle rich.
Yes, the deal finally gets Republicans to accept a tax increase on the wealthy, but this is an inside-the-Beltway symbolic victory. If anyone believes this will make the GOP more amenable to future tax increases, they don’t know how rabidly extremist the GOP has become.
The deal also extends unemployment insurance for more than 2 million long-term unemployed. That’s important.
But I can’t help believe the President could have done better than this. After all, public opinion is overwhelmingly on his side. Republicans would have been blamed had no deal been achieved.
More importantly, the fiscal cliff is on the President’s side as well. If we go over it, he and the Democrats in the next Congress that starts later this week can quickly offer legislation that grants a middle-class tax cut and restores most military spending. Even rabid Republicans would be hard-pressed not to sign on.
Robert B. Reich, Chancellor's Professor of Public Policy at the University of California at Berkeley, was Secretary of Labor in the Clinton administration. Time Magazine named him one of the ten most effective cabinet secretaries of the last century. He has written thirteen books, including the best sellers "Aftershock" and "The Work of Nations." His latest is an e-book, "Beyond Outrage." He is also a founding editor of the American Prospect magazine and chairman of Common Cause.
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The elites have each dodged thousands of dollars of taxes by the Obama capitulation. They can keep that extra Lexus at their vacation condo. And their kids are guaranteed an extra half million in life lottery winnings by the "the best we could get for now".
I have come to love and anticipate MORE from your insights. Press on!
And this of course will be exactly what Obama wants. He is a full-fledged supporter of Neoliberal Austerity but his followers will claim it is the nasty Republicans.
$250,000.00 income does not put you in the 'middle class'. With that much coming in each year, you are in the top 2% of all the people. That means a hell of a lot of very wealthy people will paid a pittance in taxes as they enjoy inherited wealth with out fair taxing. By these two facts the wealthy will continue to avoid paying, the nation will have to cut governmental services to the people and our society. No way those drones (remotely controlled 'Representative s') will vote to end the wars or try to mitigate global climate change.
Why was "going over the cliff" not a good option? for who? It would have wiped out the tax breaks for the rich permanently and then the dems could have immediately come back with proposals for tax relief for the 99% (or 98 or whatever) which would have put the republicans in the position of having to publicly oppose tax breaks for all but the very wealthy. so this may look "pretty good" for Obama (and will give him permanent tax breaks when he becomes the ex-president) but, as Reich points out, it pretty much screws the rest of us.
If we're going to go through another 4 years of walking on eggshells to appease the elite this country will fall apart in civil unrest and revolution. Yes, Obama has a mandate but the reason he didn't have a landslide victory was because he was considered the lesser of the evils, not for the popularity of his (or his handlers') Centrist ideals.
Explain how President Obama could force Congress to approve 100% of what he originally proposed?
From this point on, I will no longer follow the news because I can't take the constant brinksmanship of this ship of fools.
The whole pack isn't worth the powder it would take to blow them up.
I am disgusted.
and it continues the divide between the 99% & 1%.
Much like the 2008 economic collapse, this, too, disgusts me but doesn't surprise me.
My only quarrel with what Reich says is this: Obama does not have the public on his side. The public is on the side of a position Obama appeared to endorse, but it was all hypocritical posturing. When the chips -- the blue ones -- were down, he cavalierly sold us out.
Vintage Obama.
Note to Obamacrats: When you predictably gives this post your thumbs down, have the courage to state your reasons.
As bad a deal as Obama got in the Senate, it establishes a baseline position from which Atilla and his Huns can begin to "negotiate" (used loosely) even a worse one. As bad as the fiscal cliff is, Kibbe and his lunatic fringe will make sure to make things even worse.
Outsourcing the whole government to the Klan might not spark enough outrage to fix the dysfunction as we have now. We have become a nation of " Cousin Eddies" from the National Lampoon Vacation movie. And as Ron White says, "You Can't Fix Stupid."
This is no time for "woosy-ism", if the Republicans in congress aren't brought up short..then the middle class will pay the price.
He's got the high ground, and if he doesn't use it to his (and our) advantage, he will become just another '2.0 GPA' president
The ball is in your court, Mr. President!
The 1% own both parties. Join the Green party if you are true progressive or join the Libertarian party if a true conservative. You will not be represented by either the Dems or Repugs.
Here are some solutions by the first person to warn us all & coin the phrase "Republicrats" a decade ago but only those who were willing to listening heard it. US Green Party is now the new blue. http://readersupportednews.org/opinion2/277-75/15286-focus-17-solutions-for-a-better-america-in-2013
How does he continually fail to see how the Republicans are playing him into the corner every time? As Robert Reich states, "..After all, public opinion is overwhelmingly on his side. Republicans would have been blamed had no deal been achieved."
We will now see the same Republicans play more games with a new debt ceiling debacle as in 2011. It never ends!
The only hope may be taking Congress in 2014. In the meanwhile, Obama remains an object of GOP manipulation.
The good news, however, is that we don't have Romney and Ryan entering the scene. Imagine how that would be.
NOV. 2006 Harper's- Barack Obama Inc. : The Birth of a Washington Machine
Democrats and Republicans should be able to agree to tax cuts for the poor and those making less than, say $50,000 per year. Above that, any tax cuts would have to be balanced by cuts to such spending as fossil fuel subsidies and military spending or increases in capital gains taxes for those making more than $250,000. That is how you bargain.
Can you cite any credible evidence that Obama wanted a better deal than the one he has agreed to?
There is no credible evidence that he wanted anything different than what he got!!
Going over the cliff is simply a rupurt murdockian/fox disinformation network construct. Suspect BHO is simply setting himself up for the big payday after 2016, much like Clinton Inc. has been doing since '01. Now all he needs is for Michelle to become the next Senator from Wall St. to secure their after-office sinecure.
Until we begin to challenge him and the Democratic leadership in Congress we are going to continue to see things like this happen.
By the way, why did you include adding in military spending at the end of your article. The automatic spending cuts for the military would have been one of the best things that would have come from the fiscal cliff. The US spends as much on the military as all of the rest of the world combined.
Clinton cut defense spending by a 1/4 in the 90s. Bush pushed it right back up again and then some; and Obama continues to increase it.
Our military focus and spending is making us less secure not more.
Rob Wheeler
robwheeler22 a gmail.com
Mr. Reich: This is NOT about "placing blame" ... this is about the survival of the middle class and America. It would appear you comment might have been made due to the "brain washing" by the GOP/Faux News about placing blame - NOT finding a workable solution to the issues at hand.
What have we learned during the first hours of the year 2013?
Occupy people, especially, may be starting to identify their priorities - the really big concerns - for the next two years and beyond.
SIMPLY STATED: 1) Protect the essential programs that middle-income and low-income consumers need; 2) Develop a fair taxation program; 3) Build a progressive Congress.
Obama? Don't expect too much or too little from the guy. He won his big victory in November and he'll never run for public office again. Keep some pressure on Obama. Build a better Congress. Organize, organize, organize.
I always learned and taught problem solving from the point of view of opposite thinking. It prompts one to explore all causation and solution alternatives.
One solution completely overlooked was allowing the U.S. to go over the economic cliff. We would all pay slightly more taxes--and the federal government's key programs would be funded. We would cut Defense by 20 percent--and friends in the military say there is upwards of 50 percent waste there, so it would be unnoticed.
Instead, everyone bitched about keeping tax cuts and "Protecting our military." A pretty sad situation when a nation's military whines for protection. :)
There is a way to fix it, but it will take work, determination, and, hardest of all, change.
The way we will take back America from the corporations is:
1) Take our money out of the big banks and Wall St, and don't patronize those corporations any more than you must. (Put your money in member-owned credit unions. Or read "Locavesting".) Wall St cannot be tamed: it must be eliminated. Capitol Markets were introduced into America to fuel industrial growth. They no longer do this – their job is done.
2) We will start a lot of worker-owned, democratically- run businesses, where the people who do the actual work get the say and share the profit.
a) Form locally sustainable economies
3) We must elect progressive candidates to protect us from the destruction planned by the conservatives.
4) We will start our own scrip, and gradually replace the old Dollar with the New Community Scrip, which We the People will control with our own banks or credit unions and regulating agencies.
5) Assume the frame of moral/ethical leadership. (Read George Lakoff.)
I'm certain that if living wage jobs were available then more likely than not many of those enlisted now would opt out of the service.
Even when Obama holds ALL the cards in the deck, he still blinks first.
That's one powerful blast!!!
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