LOL... yet listening to my Fox-addicted FIL, the compromise was "only getting higher taxes... nothing else". So I guess as always, what you believe is based on where you hear it...
Details are still sketchy, but initial info (from Ezra Klein) seems to be: 1. Tax hikes on $400k+ for individuals, $450k+ for families; also has phase outs of deductions for higher income earners, limiting potential loopholes. 2. Estate tax gets a halfway compromise of some sort. Cap Gains go up for above $400k; stay same for everyone else. 3. No spending cuts 4. Extension of unemployment insurance and a variety of Obama "stimulus cuts" like expanded child credit, etc. 5. Permanent fix of the AMT Overall, a small deal that does nothing for the deficit. Dems get $600B-$800B, depending on the accounting. But they win on getting NO spending cuts at all. Hard to say overall how this plays out. Case for the Dems: http://www.washingtonpost.com/blogs...te-house-thinks-its-winning-the-fiscal-cliff/ Case for the GOP: http://www.washingtonpost.com/blogs...licans-think-theyre-winning-the-fiscal-cliff/ My opinion is that in the short term, Dems get much of what they wanted ($600-$800B higher revenues, extension of unemployment, stimulus cuts, etc). GOP gets nothing of what they wanted (no spending cuts, no entitlement reform, and taxes go up some). So from that perspective, it's a Dem win - but a lot seems to depend on the next round of the debt ceiling debate, and a significant Dem concession is that they no longer have leverage there - which isn't a good sign. GOP doesn't either, but they are more willing to blow things up, so they get leverage by default. Overall, I think I'd prefer no deal and force the issue on better terms on Jan 3, but as far as $250k flat vs $400k with phaseouts of deductions, I think it's a wash. Each has benefits, but I like eliminating deductions a lot more than anything else (the Romney proposal on this topic was the best way to raise taxes of all that have been suggested). Ideally, I'd want $250k with phaseouts, but I'm not sure that was ever discussed. The AMT thing shoudn't really be connected to any of this, but it's huge in that it's a stupid thing that shouldn't be negotiated every year. Depending on how the fix is done, this could actually be a huge win for the Dems. Right now, AMT assumes we'll generate more revenue every year and then we "fix" it and we get less than expected. So if we instead actually get this revenue every year, that's another $500B+ over 10 years. I'm not sure if this is the case or not, though, without having details on what the fix is. AMT accounting is one of the more ridiculous things in terms of how we budget vs where we end up every year.
If the repubs are serious about spending cuts they have to look at the bloated DoD and defense spending. Nothing should be sacred
They aren't serious. They just don't have an agenda of their own, so they are reaching back to the deficit issue for SOMETHING to say. They can't keep talking about their social agenda as that's been resoundingly rejected. They can't really talk about supply side economics working, since that's just silly. So they're continuing their agenda of fear hoping to slow down their inevitable slide into obscurity. You really can't take a party that uses the debt ceiling as a weapon seriously.
I was watching ABC News as usual nightly (got to see what folks are supposed to believe). I saw them constantly breathlessly claiming that the average American's s taxes would go up $3k plus. This puzzled me as I remember Dubya's two tax cuts for the wealthy both both gave next to nothing, but a carefully crafted little bi,t to the average American. I forgot the payroll tax reduction which was separate and later but still a sort of win for the Repubs as it makes social security weaker, but a sort of loser for the Repubs once Obama got in because it helped stimulate the economy which interfered with the keep Obie from being reelected at all costs.
Their agenda is to force the Dems to propose some entitlement cuts and then run in 2014 on the fact that Dems proposed entitlement cuts. Anyone who thinks the Repubs are truly concerned about the deficit isn't paying attention or can't accept the truth.
You are right on the entitlement cuts. We saw Romney trying to do this. At the least they can muddle the issue. The Dem Congress has been furious at Obama for taking that issue away from them in the 2012 race by sort of taalking about cutting social security in his phoney "grand" bargain feints.
The SS payroll tax cut was a Dem idea that was pushed by Obama and the Democrats in 2010. It was never a win for the GOP as they never supported it and it never existed during the Bush admin. The GOP did come around to supporting a version of it that applied to employers instead of employees, but that didn't go anywhere. In terms of the breakdown of the $3k, the Bush tax cuts are worth about $2000 and the Obama SS payroll cut is $1k (the $3k figure is based on a $50k income). The tax holiday has always been controversial even amongst Democrats because of exactly what you said: its consequences to Social Security. The AARP and other groups have consistently opposed it, and it doesn't seem like anyone made much of an attempt to continue it for next year. It was probably the most stimulative form of tax cuts, but it also was meant to be temporary, so it has to go at some point.
But regardless, those numbers aren't particularly accurate. Tax hike is estimated at $715B over a decade. Ignoring the fact that the first year is less than out years, let's estimate it at $71.5 billion per year. GDP is approximately $15 trillion. Simple math tells that you that's well below the 1+% listed on the graph. Did the chart come from the skewed polls guy? I guess it does at least make a mockery of the GOP's claims of Clinton's tax increases and Obamacare tax increases being the biggest in history and other such nonsense, though.
Why would any GOP members of Congress vote for the proposed "deal"? I mean... it's fine by me, but I don't really see the concessions to their agenda.
Two reasons: 1. Not wanting to look bad and be held responsible for going over the cliff. 2. Lack of clarity what their options will be 3 days from now - it might be the best they can get.
