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You are here: Home / Politics / Obambi

Obambi

by John Cole|  November 28, 20121:10 pm| 122 Comments

This post is in: Politics, Tax Policy

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Love it:

n angry warning by President Barack Obama delivered well over a year ago foreshadowed his campaign-style approach Wednesday to pressuring Republicans to compromise on a deal to avoid the fiscal cliff.

In July 2011, Obama told House Majority Leader Eric Cantor, one of the lead Republican negotiators in the endless budget battles of president’s first term, that it was time to make a deal or face the consequences.

“Don’t call my bluff,” the president said in ending the White House meeting, according to Cantor. “I’m going to the American people with this.”
Obama subsequently held a series of events around the country, mostly in swing states of the November election, in which he pushed for higher taxes on the wealthy as part of his main campaign theme to restore equal opportunity for the middle class.

He won re-election, and, faced again with the same fiscal issues — a seemingly unbridgeable divide with Republicans over taxes and spending — Obama is again taking his case to the people.

I guess I am in what someone referred to as the Thelma and Louise crowd, in that I am perfectly fine going over the cliff. Ending the Bush tax cuts and big cuts to defense? Sounds good to me!

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Previous Post: « There’ll Never Be Days Like That Again
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Reader Interactions

122Comments

  1. 1.

    Raven

    November 28, 2012 at 1:16 pm

    Fuck em if they can’t take a joke.

  2. 2.

    c u n d gulag

    November 28, 2012 at 1:17 pm

    The President and the Congressional Democrats will be in much better shape to negotiate after we go over the “Fiscal Molehill,” than right now.

    Then, they can say, “Hell NO, to “earned benefit” reductions” – and demand that the Republicans give the middle and poorer class their tax cuts.

  3. 3.

    Yutsano

    November 28, 2012 at 1:17 pm

    So Obama is still worse than Bush and we should start buying catfood for Grandma in the basement amirite?

  4. 4.

    Cassidy

    November 28, 2012 at 1:18 pm

    WTF? Did you all coordinate a day off from work or something? I haven’t seen this many posts in one day in months.

  5. 5.

    The Moar You Know

    November 28, 2012 at 1:19 pm

    I have a feeling that the “big cuts to defense” aren’t going to happen, although the rate of increase in the defense budget is basically going to stop. But we’re going back to Clinton-era tax rates no matter what, and I’m fine with that even if it hits the middle class. Let’s see if the Republicans will vote down a bill that cuts taxes because it doesn’t cut them for the rich. My bet is “yes, they will”.

    But yeah, remind me how the Republicans won with that deal?

  6. 6.

    Yutsano

    November 28, 2012 at 1:19 pm

    @Cassidy: It’s not even a particularly busy news day, that’s the really funny thing. Tunch must be up to something.

  7. 7.

    scav

    November 28, 2012 at 1:20 pm

    minor giggle about someone saying “Don’t call my bluff.” to those that built the fiscal cliff, leading to a slump in the polls, a landslide election and weeks of getting mass wastage.

  8. 8.

    ShadeTail

    November 28, 2012 at 1:21 pm

    Let’s stop calling it “defense” spending. That euphemism has always been a load of shit. It is *WAR* spending. They changed it in order to give it a pleasant framing to the public, as protection for the military-industrial complex.

  9. 9.

    Cassidy

    November 28, 2012 at 1:21 pm

    @Yutsano: I can’t complain. I got my work done last week, my boss is gone for the whole week, and I’ve been bored as shit just doing the little daily stuff.

  10. 10.

    Ted & Hellen

    November 28, 2012 at 1:23 pm

    I guess I am in what someone referred to as the Thelma and Louise crowd, in that I am perfectly fine going over the cliff. Ending the Bush tax cuts and big cuts to defense? Sounds good to me!

    Totally. Which is why it won’t happen.

    Although I welcome and hope for the opportunity to be pleasantly surprised.

  11. 11.

    Jack the Second

    November 28, 2012 at 1:23 pm

    I’m totally fine with the idea of Clinton-era taxes and defense cuts, but the idea of bumping unemployment up by 1.5% makes me a little nervous.

    In my ideal world I’d love an explicitly temporary infrastructure-spending based stimulus to bridge the gap for N years rather than kicking the return to a functional tax code down the street for N more years, but I somehow suspect that’s not an option.

  12. 12.

    Another Halocene Human

    November 28, 2012 at 1:24 pm

    http://www.theamericanconservative.com/articles/revenge-of-the-reality-based-community/

    Bruce Bartlett making me laugh so hard right now. Especially when he gets to Keynes. Kind of glosses over how he’s grappling with primary sources for the first time in a looooooong career. I’m laughing because I resemble those remarks, although my koolaid was the Austrians rather than supply side economics. Not that I bought into that model entirely, but it’s kind of seductive. AND WRONG.

  13. 13.

    Amir Khalid

    November 28, 2012 at 1:24 pm

    @ShadeTail:
    Wasn’t your Department of Defense once known as the War Department back in the 19th century?

  14. 14.

    Maude

    November 28, 2012 at 1:24 pm

    @ShadeTail:
    Also the Pentagon’s version of Toys R Us.

    Unemployment extensions and some other things are in this. If it isn’t solved, that will be a problem.

  15. 15.

    aimai

    November 28, 2012 at 1:25 pm

    I hate to say how much I am enjoying every day since the election. You know that strange feeling of disorientation after the 2000 election, like you woke up in an alternate, dystopian universe? I think its finally worn off.

  16. 16.

    Southern Beale

    November 28, 2012 at 1:25 pm

    John, read the White House Sequestration Report from September.

    The Pentagon would just shift money around to make sure the war is still funded (there’s always money for war!) But the cuts to Medicare, Medicaid, state education grants, FEMA emergency food & shelter, etc. will be devastating, and hurt the people who can least afford it. No I am not cheering to go over the cliff. That is insanity.

  17. 17.

    Yutsano

    November 28, 2012 at 1:25 pm

    @Cassidy: I feel like hell but I have a meeting today and stuff I need to get done before a meeting tomorrow, so odds are I’ll just do a half day and call it good. We’ll see what happens once I get there, plus I get to leave early to attend to an errand. FUN!

    @Amir Khalid: Up until @1949 in fact.

    (and FYWP)

  18. 18.

    MattF

    November 28, 2012 at 1:25 pm

    Slightly OT– What the hell is the ‘Obambi’ troll about? I just flat-out don’t get it. I understand that it’s supposed to get me pissed off, but… how, exactly?

  19. 19.

    Ted & Hellen

    November 28, 2012 at 1:26 pm

    @Cassidy:

    I got my work done last week, my boss is gone for the whole week, and I’ve been bored as shit just doing the little daily stuff.

    Sounds like a real challenging career you’ve got going there.

  20. 20.

    Denny

    November 28, 2012 at 1:27 pm

    Yes, big cuts to defense after which we will still be spending more on our military than the rest of the world combined.

  21. 21.

    El Tiburon

    November 28, 2012 at 1:28 pm

    I guess I am in what someone referred to as the Thelma and Louise crowd, in that I am perfectly fine going over the cliff

    .
    Yes please.

    Drive the fuck over.

  22. 22.

    Southern Beale

    November 28, 2012 at 1:28 pm

    @Denny:

    Eggggzackly. The Defense budget is so bloated they won’t even feel the pinch. Oooh have to buy the gold plated toilet seat instead of the solid gold one. The horror.

  23. 23.

    Ted & Hellen

    November 28, 2012 at 1:30 pm

    @Jack the Second:

    In my ideal world I’d love an explicitly temporary infrastructure-spending based stimulus to bridge the gap for N years rather than kicking the return to a functional tax code down the street for N more years, but I somehow suspect that’s not an option.

    Alluding to another thread, this is another example of how Grover has WON. The exact thing that this economy needs, massive government spending, is not going to happen even at a time of historically low interest rates. Because the Dems are playing Grover’s game.

  24. 24.

    Denny

    November 28, 2012 at 1:31 pm

    @MattF:

    Matt – If I recall correctly this was a term used by various Right-wingers to disparage Obama for his supposed lack of experience. Supposed to conjure up the mental image of the “deer in the headlights”, Obama is weak, etc.

  25. 25.

    Belafon (formerly anonevent)

    November 28, 2012 at 1:32 pm

    @Southern Beale: I don’t want to hurt any of the people on those things, no matter how many of them voted for Republicans, but we are in much better shape in the economy than we were two years ago. Like Gingrich in the 90s, this really is the best time to break the Republicans, and especially break Norquist’s hold over the party. Heck, the public’s ready to blame them for any stalemate.

  26. 26.

    ShadeTail

    November 28, 2012 at 1:32 pm

    @Amir Khalid:
    It was called the Department of War well into the 20th century. It actually wasn’t that long ago, historically, that the name was changed to Department of Defense. During the Cold War 60’s, if memory serves.

    EDITED TO ADD: Just looked it up, and it actually happened in the late 40s, shortly after World War 2.

  27. 27.

    Svensker

    November 28, 2012 at 1:32 pm

    @MattF:

    Because it shows what a wussy lightweight “Obambi” really is, not a real man like Commander Codpiece.

  28. 28.

    Schlemizel

    November 28, 2012 at 1:32 pm

    @Amir Khalid:

    Yes it was. It was changed because we didn’t want to be seen as making war, merely defense by other means 8-{D

  29. 29.

    Cassidy

    November 28, 2012 at 1:33 pm

    @ShadeTail: Of all the things to pick a fight over, that’s not even worht the effort.

    @Ted & Hellen: And your point? I have a job. I do a good enough job to be half a week to a week ahead depending on projects? So are you observing or are you mealy mouthing something?

  30. 30.

    Maude

    November 28, 2012 at 1:33 pm

    @Amir Khalid:
    Truman signed the law that changed the name. It’s the National Security Act of 1947.

  31. 31.

    Schlemizel

    November 28, 2012 at 1:35 pm

    @Cassidy:

    I’m in a streak where I start some automatic stuff & then have free time until it finishes. Then I have a mountain of data to analyze but those golden moments of waiting have really piled up recently. Probably spent as much time here in the last 2 weeks has I had in the previous year

  32. 32.

    Amir Khalid

    November 28, 2012 at 1:35 pm

    Funny you should bring this up. Someone was just complaining, one thread down, that Obama hasn’t dared talk out loud about raising taxes on the rich.

    @Ted & Hellen:
    And you say that it’s not you who starts with the ad hominem insults?

  33. 33.

    FormerSwingVoter

    November 28, 2012 at 1:36 pm

    Grah.

    We should not go over the fiscal cliff when unemployment is barely under 8% and long-term unemployment is at an all-time high.

    We’re the liberals – we’re the ones who are supposed to care about the human costs of policy decisions. Let’s not forget that just because we’ve actually got the upper hand for once.

  34. 34.

    Pinkamena Panic

    November 28, 2012 at 1:38 pm

    Yet again it must be said: Don’t give Speshultimmeh the time of day. He’s just waiting to be banned by Cole again.

  35. 35.

    ShadeTail

    November 28, 2012 at 1:38 pm

    @Cassidy:
    Like hell it’s not worth it. Framing is nearly everything, something the GOP and Faux “News” should have taught us by now. If democrats and liberals insist on calling it war spending instead of defense spending, it would be a powerful framing that could convince a lot more people that it needs to be cut.

  36. 36.

    ranchandsyrup

    November 28, 2012 at 1:38 pm

    This cliff is the only cliff where you can fall off but it takes a year to hit the bottom. Also, too, you can change directions in midair.

  37. 37.

    Schlemizel

    November 28, 2012 at 1:42 pm

    @FormerSwingVoter:

    I stopped caring about humanity when I found things like Makot chan & ted and hellen in it. Any organism capable of producing members that actively work for their own destruction does not deserve to continue. The meteor can’t get here soon enough

  38. 38.

    Cassidy

    November 28, 2012 at 1:43 pm

    @Amir Khalid: To be fair, I called him/her petulant in another thread, so It’s not really just out of the blue.

    @Schlemizel: Prettymuch the same here. I utilize my outlook calendar like nothing else. I have a time scheduled for all of my daily/ weekly/ monthly work tasks and in between….lately it’s been nothing.

    @ShadeTail: Fair enough. I don’t agree that’s a battle worth picking, but you make sense.

  39. 39.

    ShadeTail

    November 28, 2012 at 1:43 pm

    @FormerSwingVoter:
    That’s the beauty of the fiscal cliff. *It’s actually not a cliff at all.* It’s more like a very long and slow incline. It would be several months before the bad effects really start being felt, which would give the President plenty of time to put the right-wingers in a strangle hold and force them to agree to favorable terms.

  40. 40.

    Raven

    November 28, 2012 at 1:43 pm

    @Cassidy: Maintain a low profile at all times.

  41. 41.

    Steeplejack

    November 28, 2012 at 1:45 pm

    @Amir Khalid:

    Up until the 1940s, in fact.

  42. 42.

    Schlemizel

    November 28, 2012 at 1:45 pm

    @ShadeTail:

    Agreed
    A critical point the Dems seem to not understand. We keep thinking that silly things like facts and past experience and peer reviewed research will win the argument. The big blind spot in recent history for the Dems is that its all about the BS and the framing and the propaganda.

  43. 43.

    Belafon (formerly anonevent)

    November 28, 2012 at 1:45 pm

    @FormerSwingVoter: Yes, but what do you do the other party uses that against you? If we let taxes on the wealthy go back up, we can cover more people.

  44. 44.

    Maude

    November 28, 2012 at 1:47 pm

    @Raven:
    Duck and cover.

  45. 45.

    jeffreyw

    November 28, 2012 at 1:47 pm

    All this talk of cuts scares puppeh.

  46. 46.

    Maude

    November 28, 2012 at 1:48 pm

    @Steeplejack:
    Hi, My name is Maude and I shop for Nookbooks at B&N.
    My life has become unmanageable.

  47. 47.

    sacrablue

    November 28, 2012 at 1:49 pm

    @Cassidy: Today is a seriously crappy weather day in my neighborhood. I have four angry kittehs picking on each other because they can’t go out in the wind and the rain and apparently they blame each other.

    I was so hoping I would find something to distract me on BJ. I wasn’t expecting that any of the FPers could read my mind.

  48. 48.

    catclub

    November 28, 2012 at 1:51 pm

    @MattF: I have pointed out before that Bambi grew up to be the top buck of the forest.

    No one seems to remember that. All they know about is Bambi Versus Godzilla.

  49. 49.

    Schlemizel

    November 28, 2012 at 1:51 pm

    @Cassidy:

    To be fair to T&H? What on earth for? Have they ever been fair to anyone here? I may have missed it but I suppose it could have happened. I seem to miss a lot of the really fun stuff here 8-{(

  50. 50.

    Ted & Hellen

    November 28, 2012 at 1:51 pm

    @Amir Khalid:

    And you say that it’s not you who starts with the ad hominem insults?

    Absolutely. I’d say 80 per cent of the time the ad hominems start from the Bots.

    Unless you’re going to count Obot as an ad hominem, which it isn’t. It’s merely an accurate descriptive term.

  51. 51.

    GregB

    November 28, 2012 at 1:52 pm

    Can you at least use the same framing of this issue that is used by my wingnut friends on FaceBook and refer to it as the FISCAL CLIFF!

  52. 52.

    Schlemizel

    November 28, 2012 at 1:53 pm

    Yes, ad hominems are only what I say they are & only used against me

  53. 53.

    Southern Beale

    November 28, 2012 at 1:53 pm

    Y’all might want to climb into a time machine and go back to Sept. 29 2008, when the House failed to pass the bank bailout bill and the stock market dropped nearly 800 points. Failing to act on the fiscal cliff stuff will be like that but three times worse.

    I do not want that.

  54. 54.

    muddy

    November 28, 2012 at 1:53 pm

    @jeffreyw: The puppeh scared me! He’s huge!

  55. 55.

    schrodinger's cat

    November 28, 2012 at 1:54 pm

    @MattF: Obambi: He is wimpy, like Bambi. MoDo uses it a lot.

  56. 56.

    Southern Beale

    November 28, 2012 at 1:55 pm

    @ShadeTail:

    It would be several months before the bad effects really start being felt,

    Bullshit. The markets will crash immediately. And globally.

    I’m outta here. Y’all are driving me nuts.

  57. 57.

    catclub

    November 28, 2012 at 1:56 pm

    @ShadeTail: Every discussion of this so-called cliff with the GOP should start with. “You said you are against deficits. All the things which you oppose that are involved in this fiscal cliff REDUCE those deficits. Now, what do you actually oppose?”

  58. 58.

    Ted & Hellen

    November 28, 2012 at 1:56 pm

    @Pinkamena Panic:

    He’s just waiting to be banned by Cole again.

    I AM special. Most of us are. I’m sorry you’re not.

    As you know, Cole rarely bans anyone and has never banned me. I wonder, then, why you keep repeating this fable. Perhaps because your bullshit regarding the discussion is so weak?

    Also, your repeated failed attempts to isolate me here with your hall monitor admonitions are embarrassing.

  59. 59.

    schrodinger's cat

    November 28, 2012 at 1:56 pm

    @Schlemizel: Troll makes the same comments over and over again, no matter what thread.

    1. Obots
    2. John Cole doesn’t post much on his blog anymore
    3. You Obots, bow down before my wisdom
    4. Stop picking on me.

  60. 60.

    Waynski

    November 28, 2012 at 1:57 pm

    Anyone remember how much wealthier they were when the Bush tax cuts kicked in? Yeah, me neither. I’d prefer this doesn’t go into the new year, but if the Rethugs think they can force a shitty deal on us when they have virtual zero leverage, well…please proceed Governor.

  61. 61.

    Schlemizel

    November 28, 2012 at 1:57 pm

    @Southern Beale:

    Excellent point. Also, at that time, it was the wingnuts demanding fire and brimstone as a way to subdue the Dems while the good guys were claiming that was a dangerous path.

    The sides have swapped but I think the reaction, in large part because of the build up the non-event has been getting, would be really ugly. I’m not convinced the goopers would get all the blame but, even if they did, I am not comfortable suggesting the melt down is something we should encourage.

  62. 62.

    Belafon (formerly anonevent)

    November 28, 2012 at 1:58 pm

    @Southern Beale: Except this is not a cliff. It’s a roll down a hill that has a wall at the bottom. At any time, we can hit the brakes, turn to the side, etc., but the possible damage doesn’t all happen at once.

    And yes, I work for a company that would be affected.

  63. 63.

    Steeplejack

    November 28, 2012 at 1:58 pm

    @Maude:

    Hi, Maude. [Reaches for sobriety chip]

    Check out the Gutenbergs, U.S. version and Australian version, for lots of free books you can put on your Nook, e.g., old mysteries by Freeman Wills Crofts, Erskine Childers, Fergus Hume, John Buchan, Ernest Bramah, G.K. Chesterton, etc.

  64. 64.

    Amir Khalid

    November 28, 2012 at 1:58 pm

    @Ted & Hellen:
    By that logic, Cassidy calling you petulant isn’t an ad hominem attack either, because it’s an accurate description.

  65. 65.

    Ted & Hellen

    November 28, 2012 at 1:59 pm

    @Schlemizel:

    ad hominems are only what I say they are & only used against me

    You are correct.

  66. 66.

    Roger Moore

    November 28, 2012 at 1:59 pm

    @Amir Khalid:

    Wasn’t your Department of Defense once known as the War Department back in the 19th century?

    Not exactly. The Army and Navy used to be separate Departments, with Army being called “War”. DOD was formed by consolidating them, with the Army and Navy being sub-departments and the Air Force being split off from the Army into a co-equal department.

  67. 67.

    SFAW

    November 28, 2012 at 2:00 pm

    @jeffreyw:

    Jesus H. Christ! Will you give us some warning before you do stuff like that?

  68. 68.

    catclub

    November 28, 2012 at 2:01 pm

    @Southern Beale: We were also losing jobs at a great rate, housing prices were falling nationwide, plus the short term loan market had already frozen up
    (overnight rates). I do not see the same conjunction of bad things. We are slowly gaining jobs. There is no false feeling that the economy is just fine ( if you also remember 2008, Gramm was saying that all summer. This year, no one, on either side, is saying that.) Thus no misconceptions to be disappointed from. People who panic and sell will transfer their assets to those who do not panic.

  69. 69.

    Maude

    November 28, 2012 at 2:02 pm

    @Steeplejack:
    Thanks. Now my life is really going down the tubes. I’ve written down the sites.
    I have been at Gutenberg before. Wonderful site.

  70. 70.

    Schlemizel

    November 28, 2012 at 2:03 pm

    @schrodinger’s cat:

    Yes the chairgirl of the mean girls club likes to emasculate the President of the United States. She thought it would get her head cheerleader status when the goopers feed her the idea.

    I forget, how did that work out for them? Did the wimpy little guy fold when the heat was turned up? I had an uncle who said he used to go out & beat up “queers” until one night he got his ass kicked pretty good. He said he was so embarrassed at getting whomped by a ‘sissy boy’ that he never wanted to try again. Too bad the goopers are even stupider than that uncle

  71. 71.

    Amir Khalid

    November 28, 2012 at 2:03 pm

    @Ted & Hellen:

    I AM special.

    Snigger.

  72. 72.

    Ash Can

    November 28, 2012 at 2:05 pm

    @Southern Beale: You appear to be confusing this situation with the one last summer, in which the Republicans were threatening to not raise the debt ceiling, which would have had the immediate effect of putting the US government into default, thereby crashing markets (and everything else) locally and globally. The current situation is very different. Going over this fiscal “cliff” would likely have an initial dampening effect on economic recovery if nothing else is done, but it would be nowhere near the economic conflagration that would result from putting the US into default.

  73. 73.

    Maude

    November 28, 2012 at 2:05 pm

    @catclub:
    Heard on Bloomberg this morning that house flipping is back in Phoenix, AZ. Prices are up.

  74. 74.

    scav

    November 28, 2012 at 2:05 pm

    Obambi BAM!!!

  75. 75.

    ShadeTail

    November 28, 2012 at 2:06 pm

    @Southern Beale:
    You go ahead and believe that if you want. I’m going to go with actual economists like Dr. Krugman.

  76. 76.

    Raven

    November 28, 2012 at 2:09 pm

    Fucking weasel. I forgot all about it while I was fishing.

  77. 77.

    Amir Khalid

    November 28, 2012 at 2:09 pm

    People who think they’re mocking Obama as a wuss by calling him Obambi probably don’t remember how that Disney cartoon ended: Bambi bests the other bucks in single combat to become King of The Forest.

  78. 78.

    FormerSwingVoter

    November 28, 2012 at 2:10 pm

    @ShadeTail: This is true for the sequester, but a lot more troublesome for the tax portion, as those all go into effect on Jan. 1st, and will have an immediate impact. If all the tax cuts expire at once, it’s going to be a fiscal shock that our economy really doesn’t need right now.

    Ideally, we can get the tax cuts extended for everyone under $X, then deal with everything else in January.

    @Belafon (formerly anonevent): I’m not suggesting that taxes on the rich should not go up; I’m saying it’s really important that taxes on everyone else not go up.

  79. 79.

    Maude

    November 28, 2012 at 2:10 pm

    @scav:
    WIN

  80. 80.

    scav

    November 28, 2012 at 2:12 pm

    @Amir Khalid: well, he can’t claim cogito ergo sum so what’s left but the perennial ego ergo sum and wait for it to pop out of the toaster so he can fight over it.

  81. 81.

    SFAW

    November 28, 2012 at 2:15 pm

    @schrodinger’s cat:

    Obambi: He is wimpy, like Bambi. MoDo uses it a lot.

    Stuff like that is always good fun.

    For example, according to the Reichtards:
    Obama is a wimp, but he directs the Chicago Political Mafia.
    He’s a Muslim, but he should disavow his pastor (i.e. Wright)
    He’s a socialist, but he’s a fascist (I’m ignoring Jonah’s idiocy here)
    He’s a Kenyan, but his father was Frank Marshall Davis (or Malcolm Little)

    No, I don’t expect logical consistency from the Rethugs/Reichtards. But it’s semi-fun trying to catalog their up-is-downism.

  82. 82.

    SFAW

    November 28, 2012 at 2:19 pm

    @Amir Khalid:

    Snigger.

    Please! On this site, it’s written “Sni-CLANG!”

  83. 83.

    SFAW

    November 28, 2012 at 2:20 pm

    @Amir Khalid:

    Bambi bests the other bucks in single combat to become King of The Forest.

    Well, yeah, that was great and all. But he didn’t do quite so well against Godzilla, now did he? The wuss.

  84. 84.

    Suffern ACE

    November 28, 2012 at 2:23 pm

    @Southern Beale: SB, in September 2008 the markets were collapsing because the banks were insolvent, or would have been if the banks couldn’t pay the other banks off on the loans and bets that were made in derivatives. There weren’t going to be functioning capital markets at all if the bailout would not pass. That is a different problem than what the fiscal cliff would represent. That’s a different problem than what we would have if there was a government shutdown in May.

  85. 85.

    Fair Economist

    November 28, 2012 at 2:25 pm

    I don’t like big deficit cuts now, because we’re still in a liquidity trap. The CBO projections of a mild recession are implicitly based on an assumption that we’re *not* in a liquidity trap, because that’s how standard models do it. The real outcome will likely be worse. That said, what we’re actually looking at in this fiscal bluff is reversing the Bush cuts, half the spending cuts from defense, and no substantial cuts to entitlements. This is considerably better than any deal we’re going to get with the Republicans in control of the House.

    If the deal is renegotiated I expect lower taxes on the wealthy, lower defense cuts, and some entitlement cuts, and that would actually be contractionary compared to the current prospects. (Tax cuts for the wealthy and defense spending are only slightly expansionary, while entitlement cuts are strongly contractionary). The current bluff is the best one we’re going to go over.

    While delaying going over any bluff would be a good idea, it’s not going to happen with Republicans in control of the House. The teabaggers want the country to suffer via spending cuts and they have the power to force it. I figure better to go over the current not-too-bad bluff than a worse one modified by the teabaggers.

    Bowles and Simpson have come out saying the fiscal “cliff” is a bad thing and really needs to be avoided. While not particularly awful for the country, it is truly bad for B-S because they are hoping to use long-term deficits as an excuse to cut entitlements. Once we’re over the cliff, the long-term deficit is not too bad while entitlements will be basically uncut. They’ll have lost their big chance to force retirees to eat cat food. If they want to continue to push for entitlement cuts, they won’t be able to hide it in the middle of a huge complex set of changes and the goal of cutting retirement benefits for the middle class to get tax cuts for the rich will be exposed.

  86. 86.

    Steeplejack

    November 28, 2012 at 2:25 pm

    @Schlemizel:

    The fiscal cliff gentle fiscal incline (h/t Charles P. Pierce) is not the same as the bank bailout crisis or the debt ceiling crisis. It is not about giant banks collapsing overnight or federal debt suddenly being rendered worthless. It is a series of spending cuts and tax increases whose effect will be gradual. Yes, they will hurt the economy, because they will reduce the deficit and run the risk of putting us back into recession.

    Krugman:

    [“Austerity bomb” is] a much better term than “fiscal cliff.” The cliff stuff makes people imagine that it’s a problem of excessive deficits when it’s actually about the risk that the deficit will be too small; also and relatedly, the fiscal cliff stuff enables a bait and switch in which people say “So, this means that we need to enact Bowles-Simpson and raise the retirement age!” which has nothing at all to do with it.
    __
    And it can’t be emphasized enough that everyone who shrieks about the dangers of the austerity bomb is in effect acknowledging that the Keynesians were right all along, that slashing spending and raising taxes on ordinary workers is destructive in a depressed economy, and that we should actually be doing the opposite.

    Going over the “fiscal cliff” will force the Republicans to get real about real solutions and not just keep yelling about tax cuts for the job creators. We might be seeing a little change already with the (seeming) lessening of support for Grover Norquist’s “no taxes” pledge.

  87. 87.

    Steeplejack

    November 28, 2012 at 2:30 pm

    @Fair Economist:

    Good points.

  88. 88.

    Fair Economist

    November 28, 2012 at 2:35 pm

    @FormerSwingVoter:

    This is true for the sequester, but a lot more troublesome for the tax portion, as those all go into effect on Jan. 1st, and will have an immediate impact. If all the tax cuts expire at once, it’s going to be a fiscal shock that our economy really doesn’t need right now.

    On theoretical grounds, you’d expect a significant contractionary effect from canceling the Bush tax cuts. However, when they were started, you didn’t have any detectable growth as a result. Actually, the economy got substantially worse after the second round. Here’s a NY Times article on recent effects from large tax changes. So I’m not too worried about the Bush cuts expiring. I’m more worried about the payroll tax cut expiring, but that’s unlikely to be saved, and the non-defense cuts, but we’re going to get big non-defense cuts anyway in any plausible deal.

  89. 89.

    catclub

    November 28, 2012 at 2:37 pm

    @Amir Khalid: Beat ya to it.

    Great minds.

  90. 90.

    trollhattan

    November 28, 2012 at 2:40 pm

    @Schlemizel:
    Prior to all that, it was “Ye Oulde Ministry for the Purpose of Booting Arse”

  91. 91.

    Fair Economist

    November 28, 2012 at 2:41 pm

    Oooh, “Austerity bomb” is a perfect term! I’m switching.

  92. 92.

    ranchandsyrup

    November 28, 2012 at 2:42 pm

    WON’T SOMEONE PLEASE THINK OF THE WALL STREETERS! I don’t want them having to hit grounders to their local HS baseball team. They eat what they kill and whatnot.
    Obama should just cave and reward hostage taking. That’ll make everything better.
    Fucking humanity.

  93. 93.

    Brachiator

    November 28, 2012 at 2:49 pm

    @c u n d gulag:

    The President and the Congressional Democrats will be in much better shape to negotiate after we go over the “Fiscal Molehill,” than right now.

    Again, not that easy. The Republicans are holding hostage some tax items for 2012 that absolutely must be decided soon, or else 60 million people may not be able to file their income taxes until March or later.

    Since these items includes some middle class tax breaks, the GOP is including them in their negociations over the Bush tax cuts.

    There has been some legislation on the table since at least early November addressing these issues drafted by a bipartisan panel. This part could be settled in a nanosecond. But the game of chicken continues. Ain’t it cool?

  94. 94.

    rikyrah

    November 28, 2012 at 2:50 pm

    I never got OBAMBI.

    didn’t you ever read to the end of the book?

    Bambi becomes THE PRINCE OF THE FOREST.

    in other words..

    Bambi becomes DA MAN.

  95. 95.

    Schlemizel

    November 28, 2012 at 2:51 pm

    @Steeplejack:

    Again, you are probably right. But for weeks now we have had the chicken littles of the world running around about the end of the world on 1/3/13. That could become a self-fulfilling prophesy if it happens.

    Its probably a good approach to take with the GOP that we are not afraid of it but I would be a liar if I didn’t admit the thought of the hysteria and 5 days in a row of the Dow down by triple digits and the panic that would ensue (some of it in the halls of COngress where poor deals might get cut) scares the Glenn Beck art work out of me

  96. 96.

    Schlemizel

    November 28, 2012 at 2:52 pm

    @rikyrah:

    You obviously never saw the short film “Godzilla vs. Bambi”

    It is a classic of underground animation, seriously a great laugh

  97. 97.

    Schlemizel

    November 28, 2012 at 2:54 pm

    @sacrablue:

    You appear to be in luck – I can’t recall a recent day with as many FP posts. HArd to keep them all straight!

  98. 98.

    Brachiator

    November 28, 2012 at 3:01 pm

    Here’s part of the practical, real world impact of obstructionism. The acting IRS commissioner has warned of delays related to 2012 income taxes if the Congress doesn’t act soon. This relates to the AMT patch that has to be fixed each year because nobody agrees on a permanent solution. A few other items are impacted as well. The commissionr sent formal letters to ranking legislators.

    The House and Senate have already approved patches for 2012 in competing tax bills. In the Senate, the Middle Class Tax Cut Act (Sen. 3412) would set the AMT exemption amounts for individuals at $50,600 and at $78,750 for married couples filing a joint return. The House approved the same exemption amounts for 2012 in the Job Protection and Recession Prevention Act (HR 8). If no patch is passed, the AMT exemption amounts are $33,750 for individuals and $45,000 for married couples filing a joint return for 2012.
    __
    Miller told lawmakers that the IRS is leaving its core processing systems “as-is” in the expectation that Congress will patch the AMT for 2012. If no AMT patch is approved by the end of the year, the IRS would be forced by law to start operating the 2013 filing season based on the expiration of the AMT patch rather than allow the higher exemption amounts under the expectation that Congress would eventually approve them some time in early 2013. The IRS would need to instruct more than 60 million taxpayers that they may not file their returns or receive a refund until the agency reprograms its processing systems. “Because of the magnitude and complexity of the changes, it is entirely possible that these taxpayers would not be able to file until late March 2013, if not even later,” Miller cautioned.

    Congress is farting around over this as they battle over the deductions and loopholes vs tax rates BS, keeping this shit tied to the other issue of the Bush tax cuts.

    Now, if they delay things until 2013, which is fine with me, withholding tables based on the expiration of the tax cuts will have to be issued, and other stuff will have to be put in place. At the very least, this means that a lot of people will end up with minor to major screw ups to their paychecks when any final agreement is reached and new tables have to be issued again.

    In the real world, many people will be affected by the crap that these fools are fighting over. The longer the delay, the harder it is to measure or to predict the degree of impact.

  99. 99.

    James K. Polk, Esq.

    November 28, 2012 at 3:03 pm

    @Brachiator: What exedit: you just named them.

  100. 100.

    Fair Economist

    November 28, 2012 at 3:04 pm

    @Brachiator:

    Again, not that easy. The Republicans are holding hostage some tax items for 2012 that absolutely must be decided soon, or else 60 million people may not be able to file their income taxes until March or later.

    People can go ahead and file their taxes. If tax changes improve their outlook, the IRS can recalculate and issue a refund, much as with the tax stimulus of 2008. The only people affected are those who are juggling which year to take an exemption or profit, and to them I say “tough cookies”. Such people are perfectly able to file a revision later.

  101. 101.

    Fair Economist

    November 28, 2012 at 3:07 pm

    @Brachiator:

    The IRS would need to instruct more than 60 million taxpayers that they may not file their returns or receive a refund until the agency reprograms its processing systems. “Because of the magnitude and complexity of the changes, it is entirely possible that these taxpayers would not be able to file until late March 2013, if not even later,” Miller cautioned.

    Changing the AMT limit requires two months of programming? When it happens every year anyway? If this is for real, the IRS needs a new IT department.

  102. 102.

    bemused

    November 28, 2012 at 3:10 pm

    I notice “Obama storms out of meeting” is a leading title among some including CBS. Now, I’m just trying to picture Obama “storming” out of anything, ever and laughing.

  103. 103.

    muddy

    November 28, 2012 at 3:12 pm

    @Schlemizel:

    I can’t recall a recent day with as many FP posts

    Perhaps they are responding to complaints. I didn’t send one, but I did remark about it to the dog. Possibly he sent one.

  104. 104.

    muddy

    November 28, 2012 at 3:15 pm

    @Brachiator: Also there are a lot of lower income people who use their tax refund like it’s a savings account, and need to get their returns in sooner than later. I know it’s not a prudent fiscal policy, but for some it’s the only way they can get a chunk all at once.

  105. 105.

    ShadeTail

    November 28, 2012 at 3:30 pm

    @FormerSwingVoter:
    You’re not entirely correct. The new tax rates that would go into effect would be on 2013 earnings, which wouldn’t come due until April 2014. And once the President and the right-wingers lower those middle-class tax rates again, the lowering can be made retroactive to the beginning of 2013. So there would be only a very minor impact, if there was any impact at all.

    Again, it’s not a cliff, it’s a very slow incline. And just like any slow incline, it will be easy to stop the drift downward.

    Also, let’s stop letting the fact that we care for people leave us in a constant defensive crouch. We’re actually not doing the middle-class any favors by letting the GOP use them as hostages or kickballs all the time. It is long past time to insist on big fixes rather than constantly bargaining for short-term relief. This whole fiscal “cliff” foolishness gives us the leverage to do that.

  106. 106.

    Brachiator

    November 28, 2012 at 3:33 pm

    @Fair Economist:

    People can go ahead and file their taxes. If tax changes improve their outlook, the IRS can recalculate and issue a refund, much as with the tax stimulus of 2008. The only people affected are those who are juggling which year to take an exemption or profit, and to them I say “tough cookies”. Such people are perfectly able to file a revision later.

    Uh, no. For 2012, if agreements are not reached, people affected may not be able to file their taxes. The IRS will not accept the returns. If the return is filed electronically, it will be rejected. If it is paper filed it will sit in a pile. If forms have to be modified, mailed returns would be sent back to the taxpayer. At some point, some electronic returns might be accepted, but would not be processed until laws were passed and computer processes adjusted.

    But of course, nobody rich or middle class or working poor really needs their refund. They can wait, right? Money isn’t that important, right? There are principles that need to be fought over.

    All this happened to a lesser degree a couple of years ago, again because of obstructionism and late deal making. The results were not pretty, had some people with Schedule A returns had to hold them back.

    Changing the AMT limit requires two months of programming? When it happens every year anyway? If this is for real, the IRS needs a new IT department.

    This may be true, but since the Republican Congress has cut IRS funding in the past, the problem is only worsened. See how that works?

    @muddy:

    Also there are a lot of lower income people who use their tax refund like it’s a savings account, and need to get their returns in sooner than later. I know it’s not a prudent fiscal policy, but for some it’s the only way they can get a chunk all at once.

    There are expiring provisions for 2012 and 2013 that the working poor depend on. To no surprise, this is almost always left out of media discussions about the Bush Tax Cuts. I am disgusted at the degree to which the poor don’t exist even to supposedly lefty pundits. The Village is a strange place.

  107. 107.

    Heliopause

    November 28, 2012 at 3:35 pm

    I am perfectly fine going over the cliff.

    Ah. May we take this as a statement of general principle? That you are fine with potentially causing deep, short-term damage to society in the hope that it will result in long-term improvement?

  108. 108.

    Cassidy

    November 28, 2012 at 3:37 pm

    The Village is a strange place.

    Don’t drink the water.

  109. 109.

    muddy

    November 28, 2012 at 3:49 pm

    @Brachiator: They probably don’t know any of “those people”.

    I know a woman, early 30’s, prep school, MBA etc who was surprised to hear from me that most jobs don’t have insurance. She looked so puzzled and confused. I said careers get insurance, jobs not so much.

    She has also in the past told me about these poor people she met in Africa, and if they missed one payday their lives were fucked. I said you don’t have to go to Africa for that, FFS. I could see in her face that it just did not compute, she was clearly puzzled and confused by this information.

  110. 110.

    Brachiator

    November 28, 2012 at 4:01 pm

    @ShadeTail:

    The new tax rates that would go into effect would be on 2013 earnings, which wouldn’t come due until April 2014. And once the President and the right-wingers lower those middle-class tax rates again, the lowering can be made retroactive to the beginning of 2013. So there would be only a very minor impact, if there was any impact at all.

    Not quite true. We have already seen in California that the withholding tables are fucked up in part because the Prop 30 tax changes were retroactive for all of 2012. The Franchise Tax Board has promised not to penalize people who technically have underpayments because of withholding mismatches. But in the real world, some people who thought they knew what their tax liability would be, or who thought that they were no affected by Prop 30 will have to come up with extra money out of their pockets to pay their taxes.

    And again, it’s not just about tax rates. Whether you are an individual wage earner or a small busines owner, if you do not know what deductions and credits will exist, your ability to make economic decisions are affected. If you don’t know whether the Child and Dependent Care Credit will disappear, it’s a little harder to spend money on day care. If you don’t know whether the Education Credits will be around when you file your tax return, would you take a chance on making tuition payments on a course you might need to get or keep a job?

    It’s funny how the head of the Fed and the IRS commissioner think that long delays over these issues would be a very bad thing, but some pundits and even Congress critters keep insisting, “ain’t no big thang.”

    I think that there might be a big political gain if Obama calls the GOP on their obstructionism. He may even come up with some ingenious ways to mitigate the pain.

    But anyone who believes that there would not be big problems, and pain for many taxpayers, is flat out wrong.

  111. 111.

    Soylent Green

    November 28, 2012 at 4:15 pm

    It’s not just big cuts to DOD (which they can absorb, given how bloated their budget is), it’s big cuts to every federal agency, including those whose budgets have been tightening for years. I work for one (whose symbol is a bear wearing a hat) and the first thing they will do is furlough us for three weeks. Then the workforce cuts will follow, done with an axe not a scalpel. The little people, lowest on the totem pole, will be the first ones to go. It’s a hell of a way to run a government.

  112. 112.

    Brachiator

    November 28, 2012 at 4:19 pm

    @muddy:

    She has also in the past told me about these poor people she met in Africa, and if they missed one payday their lives were fucked. I said you don’t have to go to Africa for that, FFS. I could see in her face that it just did not compute, she was clearly puzzled and confused by this information.

    People like this should not be allowed to leave the house, let alone visit foreign countries.

  113. 113.

    Joel

    November 28, 2012 at 4:32 pm

    @Southern Beale: Why would that happen? In the case of the bailouts, the answer is obvious: banks were insolvent. I don’t see a similar scenario here.

  114. 114.

    muddy

    November 28, 2012 at 4:33 pm

    @Brachiator: She moved to Cape Town to work for an NGO, showing poor people how to set up micro businesses. There were never any details given about the work, because it was “proprietary”. But now she’s CEO in a wi-fi startup over there. Apparently it is quite glamorous to live in Cape Town. She said once how “picturesque” the shanty towns were. Just oblivious.

  115. 115.

    les

    November 28, 2012 at 4:50 pm

    @Southern Beale:
    Too late for this, but unless your situation requires immediate sale of US stocks, who cares if the market crashes? The traders will make money as usual, and almost everyone else won’t, as usual.

  116. 116.

    Brachiator

    November 28, 2012 at 4:51 pm

    @Soylent Green:

    It’s not just big cuts to DOD (which they can absorb, given how bloated their budget is), it’s big cuts to every federal agency, including those whose budgets have been tightening for years. I work for one (whose symbol is a bear wearing a hat) and the first thing they will do is furlough us for three weeks. Then the workforce cuts will follow, done with an axe not a scalpel. The little people, lowest on the totem pole, will be the first ones to go. It’s a hell of a way to run a government.

    One of my commuting buddies works for the Army Corps of Engineers. He would agree with you bigtime that stupid across the board cuts would have a serious impact on his agency, and on critical projects.

  117. 117.

    Brachiator

    November 28, 2012 at 5:16 pm

    @muddy:

    She moved to Cape Town to work for an NGO, showing poor people how to set up micro businesses. There were never any details given about the work, because it was “proprietary”. But now she’s CEO in a wi-fi startup over there. Apparently it is quite glamorous to live in Cape Town. She said once how “picturesque” the shanty towns were. Just oblivious.

    I have mixed feelings about some NGOs. They roll into a country to “do good” but seem to have no clue about what really needs to be done, or why. And the way that some of these folk look through the people they are supposedly helping is appalling.

    On the other hand, I know of a woman who works for an organization helping orphans in Haiti who is, as far as I am concerned, the closest thing to a freaking saint with respect to her compassion, ability to do good work, and ability to comprehend all the dynamics of a very challenging situation.

    Also, there is something strange about the idea of NGO work being proprietary. What kind of stupid ass turf battle or ego stroke should prevent assistance agencies from sharing ideas and methods?

    Back to Cliff Diving.

    From the BBC:

    Billionaire investor Warren Buffett believes the US fiscal cliff may be solved by January rather than December.
    __
    Congress has until 31 December to cut a deal to stop existing economic stimulus measures terminating and huge automatic spending cuts coming into effect.
    __
    While Mr Buffett said politicians may miss the deadline, he thought a deal would follow shortly after.
    __
    On Tuesday Senate majority leader Harry Reid said talks had made “little progress”, sending stock markets lower.
    __
    “They talked some happy talk about doing revenues, but we only have a couple weeks to get something done,” Mr Reid, a Democrat, said of negotiations between his party and the Republicans.

    Apparently, Congress can’t let anything get in the way of their Christmas break.

    Again, it might help some to send legislators a little something for their stockings this holiday season. A little email or letter saying simply, “Kill the Bush tax cuts for the wealthy; keep the middle class tax breaks.”

  118. 118.

    ShadeTail

    November 28, 2012 at 6:30 pm

    @Brachiator:

    It’s funny how the head of the Fed and the IRS commissioner think that long delays over these issues would be a very bad thing, but some pundits and even Congress critters keep insisting, “ain’t no big thang.”

    The operative word there being *long* delays. Of course they can’t afford to just dither and let things coast for half the year or so, but we’re not talking about anywhere near that long. I think you’re vastly over-estimating how fast the damage would start kicking in, or how long it would take to reach the deal.

  119. 119.

    Sasha

    November 28, 2012 at 9:35 pm

    Time for SNL to do a new “The Rock” Obama sketch.

  120. 120.

    gerry

    November 28, 2012 at 9:45 pm

    “Don’t call my bluff,” the president said in ending the White House meeting, according to Cantor. “I’m going to the American people with this.”

    Silly Obama-doesn’t he know that the bully pulpit isn’t real?

  121. 121.

    mclaren

    November 28, 2012 at 10:55 pm

    While all the Obots applaud like trained seals about this decision to hurtle over the fiscal cliff, bear in mind that it’s going to do irreparable damage to things like basic science R&D in America.

    Scientific R&D stands to lose 31,000 jobs and face a starvation diet of reduced funding if politicians fail to halt march towards the fiscal cliff’s sequestration of federal funds.

    Will any of the Wall Street financial crime lords lose their jobs because of the fund sequestration?

    Three guesses.

    How many generals in the Pentagon will lose their jobs because of the fund sequesteration?

    Zero.

    How many DEA guys and federal prison guards will lose their jobs because of the fiscal cliff?

    None.

    That’s I love about Shithole America: when the crunch comes, the only people who really get hurt, the only people who get crushed and wiped out, the only people who lose their jobs and get told to clean out their desks by the end of the day, are the high-skilled highly educated PhDs, the people with math and science skills.

    The goons who beat people with truncheons in riot gear, those guys get to keep their jobs in the prisons forever. The thieves who loot pension funds at Wall Street gambling firms, those guys have a job for life.

    It’s only the scientists and engineers who get thrown out on the street.

    Seriously, people..how the fuck do you think this is gonna end for Shithole America?

    A society gets what it pays for. We keep paying for muggers with badges and corrupt incompetent generals leading an army made up of misfits and rapists.

    How the fuck do you think this story ends?

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