How much of the Boehner $1Bn is 'smoke and mirrors'? How much of it is 'back ended' and over 10 years?

Obama is the least-reasonable "negotiator" in recent memory.

Let's see . . . he ran on $800B in new taxes. After the election, his demand was $1.6T. When Boehner offered $800B and asked, "What do I get for that?"

Obama said, "Nothing. I get that for free."

He then promised to excoriate the GOP in his inaugural address and SOTU unless they caved in.

Leadership.

According to that table in Wikipedia, they were $200 mil apart by the time the Republicans walked away. That table tells me they're pretty darn close. RJ says that some of those numbers aren't "real" but I would imagine, as Dan points out, that the same would be true of the other side.

From my understanding, it seems like the Republicans should be excoriated.

geojanes wrote:According to that table in Wikipedia, they were $200 mil apart by the time the Republicans walked away. That table tells me they're pretty darn close. RJ says that some of those numbers aren't "real" but I would imagine, as Dan points out, that the same would be true of the other side.

From my understanding, it seems like the Republicans should be excoriated.

For what?

Obama opened the negotiations with twice what he ran on.

Obama has no plan that will do anything serious about deficit reduction. If there is one, please link it.

Last poll I saw was that 74 percent of the country approved the tax increase for those making 250K or more. Obama was willing to up the cut-off to 400k. The differences between what Boehner proposed and Obama proposed are minor. If there is no agreement, those making 50-100k will pay on average 2,000 more inin taxes and those making 100-200K will pay about $6,000 on average in taxes. Think they will mind their taxes going up so much because Republicans won't even agree to taxes going up on those making a million a year. Obama is leading, he has the leverage, and Republicans must concede if they don't want to get clobbered in 2014. But, hey, keep blaming Obama when his position is supported by 74 percent of the country, see where it gets you

Obama's political genius is making this about taxes, and the Republicans help him look smart by their stubborness on protecting the wealthy.

But for me, the real story is spending. We haven't seen much detail from either side, but from the Wikipedia link, Boehner proposed $1.35T in cuts, and has gone down to $1T. Obama started at $600B (now $900B) of cuts, but you have to look at the extenders / stimulus spending that is hidden. Because that spending is front loaded, Obama is actualy recommending a large increase to the budget over the next 2 years! Boehner is not. Also, keep in mind that Medicare and Social Security automatically reset to accomodate the increasing cost of the increased number of elderly and the mandatory inflation. These increases do not show up in the baseline budget.

The total spending over the next 10 years is probably about $45 Trillion. So, Obama's cuts totaling $700B over a 10 year budget that is automatically increased every year, especially when the cuts are all back ended is a rounding error, or what one of my analysts used to call budget dust. Fortunately for him, the Republicans are terrible at messaging.

Doctor Fate wrote:

geojanes wrote:From my understanding, it seems like the Republicans should be excoriated.

For what?

Obama opened the negotiations with twice what he ran on.

They walked away from the negotiations when they were really close! You're essentially complaining about Obama's negotiation style. Negotiations are not pretty, but what's important is the result and the Republicans could have gotten a result but they decided they couldn't be away from home for the holidays to work out the details? That Boehner had already gone too far? Whatever. The first is laziness, the second is incompetence.

What's going to happen is this: rates are going to go up. Republicans and Democrats will come together afterward and make a deal relatively easily. They're going to do it this way because Republican's can't abide the idea of an ad that says, "Representative so-and-so voted to raise taxes." It's really pathetic and a symptom of much that is wrong in American politics.

freeman2 wrote:Last poll I saw was that 74 percent of the country approved the tax increase for those making 250K or more. Obama was willing to up the cut-off to 400k. The differences between what Boehner proposed and Obama proposed are minor.

But, this is all smoke and mirrors. The question is what will raising taxes do to cut the deficit?

Almost nothing.

If there is no agreement, those making 50-100k will pay on average 2,000 more inin taxes and those making 100-200K will pay about $6,000 on average in taxes.

Taxes are going up on everyone. No one is talking about the payroll tax. No one is talking about the pre-existing conditions tax. No one is talking about the medical device tax.

Oh, and this won't be the last time Obama raises taxes. I don't agree with the "Obama is a Marxist" theme here, but much of his analysis of the tax burden is accurate: http://www.forbes.com/sites/peterferrar ... amanomics/

Obama is leading, he has the leverage, and Republicans must concede if they don't want to get clobbered in 2014. But, hey, keep blaming Obama when his position is supported by 74 percent of the country, see where it gets you

74% want taxes to go up? Maybe in one poll.

Now, what percentage think the President will lower the deficit or really cares about it?

geojanes wrote:What's going to happen is this: rates are going to go up. Republicans and Democrats will come together afterward and make a deal relatively easily. They're going to do it this way because Republican's can't abide the idea of an ad that says, "Representative so-and-so voted to raise taxes." It's really pathetic and a symptom of much that is wrong in American politics.

And, Democrats can't stand the idea of an ad that says, "Representative so-and-so voted to cut Social Security (or Medicare, or just about anything other than Defense).

Get rid of baseline budgeting. Force government agencies to justify their demands for money. Make them be more efficient.

Oh yeah, I forgot.

That only "works" when the government tells insurance companies to waste less.

freeman2 wrote:Last poll I saw was that 74 percent of the country approved the tax increase for those making 250K or more.

The problem with this is that when you ask how much taxes those making over $250K should be paying as a marginal rate most give a number below 35%. This poll from The Hill in February shows 10% give a number greater then 35%. I read an article about a week ago that said that number is down to 4%.
So that is a bit of a disconnect.

Archduke and RJ,

You know if Republicans passed a bill cutting taxes for the bottom 98 percent, then agreed to taxes going up on those making over 250k in return for large spending cuts then they might outflank Obama. Instead they are appearing to only care about tax rates going up a small amount on the rich. Where are their priorities? If they really care about spending cuts, they should not be concerned about this modest increase in taxes. It's not even clear that they are serving any constituency by objecting to tax rates going up on the rich, given that a lot of their income is taxed at the capitals gain rate of 15 percent. Their objection is just based in pure ideology.
I don't know that Obama has had to do anything brilliantly politically here--the Republicans have made it easy for him
Perhaps the best thing for the country is to effectively get rid of Bush II's mistakes and just let the fiscal cliff hit by rolling back the tax cuts and substantially reducing military spending, so that revenues and spending are forced into a more equal alignment. We may not get such an opportunity to do that for a long time.

freeman2 wrote:Archduke and RJ,

You know if Republicans passed a bill cutting taxes for the bottom 98 percent, then agreed to taxes going up on those making over 250k in return for large spending cuts then they might outflank Obama.

If Obama were to propose realistic spending cuts and entitlement reforms, and a plan to put us on a path to sustainability, he might outflank the Republicans. Certainly, the House GOP leadership would not be able to keep the more moderate Republicans in line if the President proposed such a bold plan, even if it included tax increases.

Instead they are appearing to only care about tax rates going up a small amount on the rich. Where are their priorities?

Instead, he's only proposing tax hikes on the upper middle class and the rich, with very little in actual cuts (at best, revenues will exceed spending cuts. My guess is the actual spending cuts will be less than 1/10th of the revenue raised because much of it will be in outlying years and will never actually happen.

Where are his priorities? Doesn't he understand we are $16.3T in debt? Doesn't he understand that when the interest rates go up, even modestly, our interest payments will become the LARGEST part of our budget?

If they really care about spending cuts, they should not be concerned about this modest increase in taxes.

If he really cares about sustainability, he should not be concerned about modest reforms in entitlement programs.

It's not even clear that they are serving any constituency by objecting to tax rates going up on the rich, given that a lot of their income is taxed at the capitals gain rate of 15 percent. Their objection is just based in pure ideology.

It's not even clear these tax increases will have any effect on the deficits. At best, they will constitute about 8% of the annual deficit, but the President is proposing new spending as well. His tax increases are based in pure ideology.

I don't know that Obama has had to do anything brilliantly politically here--the Republicans have made it easy for him

I don't know that Obama has done anything politically brilliant here--the masses of uninformed voters have made it easy for him.

Perhaps the best thing for the country is to effectively get rid of Bush II's mistakes and just let the fiscal cliff hit by rolling back the tax cuts and substantially reducing military spending, so that revenues and spending are forced into a more equal alignment. We may not get such an opportunity to do that for a long time.

Perhaps the best thing to do is to effectively get rid of Bush II and Obama by rolling back all government spending to a level based on the 1998 Clinton era spending, adjusted for inflation.

You're funny, freeman2.

The Republicans are "the problem?"

More Americans on food stamps than ever.

Most tepid recovery in history.

Highest 4 years of borrowing in history.

No end in sight to the borrowing.

Yeah, it's the Republicans' fault!

I suspect that blaming voters for not being informed enough on the issues is going to work about as well for Republicans as it did for Democrats when they used to blame white working-class class voters for not voting for their economic self-interest and instead voted for Republicans...What is really easy to understand for those making from 50-200k (i.e the middle-class) is that their taxes will go up substantially because Republicans will not allow taxes to go up on the rich. Other issues are a lot less clear to voters ( deficits, how much cuts should be made, etc.)

freeman2 wrote:I suspect that blaming voters for not being informed enough on the issues is going to work about as well for Republicans as it did for Democrats when they used to blame white working-class class voters for not voting for their economic self-interest and instead voted for Republicans...What is really easy to understand for those making from 50-200k (i.e the middle-class) is that their taxes will go up substantially because Republicans will not allow taxes to go up on the rich. Other issues are a lot less clear to voters ( deficits, how much cuts should be made, etc.)

Meh.

It's obvious that someone as informed as you has no concept of what interest rates will do to our budget when the go up. So, it may not make any political difference, but economically, it's going to crush us eventually. That will be your Great Man's legacy: turning the US into a second-rate power. It's not easy; it takes a level of determination that few in history have had. Your man has it!

Taxes are going up because Obama wants them to go up. Period. He said he would veto the "million and up" plan B.

He has not proposed extending the payroll tax cut: that raises taxes on all working Americans.

He is raising taxes on all Americans indirectly via Obamacare.

In Obama's view, the only "good money" is money the government controls.

So the 200 billion difference in spending cuts over 10 years between what Boehner proposed and what Obama proposed is going to cause us our economy to blow up and turn us into a second-rate power? That seems unlikely...