The fiscal cliff is looming in Washington D.C., and soon the Bush tax cuts will expire, followed by a massive sequester of domestic spending, one trillion dollars worth of cuts divided out over ten years.
President Obama wants the wealthy to pay "their fair share". So does Senator Patty Murrray (D-WA). Now some Republicans are signalling their willingness to go back on refusing to raise taxes. There are a diminishing number of wealthy people in this country in part because the taxes keep going up, yet job growth remains anemic, regulations are proliferating, and the unending spending turns into a tax increase with rising inflation to follow. Senator Tom Coburn (R-OK) has stated very soundly that "doing nothing is a tax increase."
Our government and our leaders owe future generations better than debt and deficits. Thomas Jefferson made this point in a letter to a close friend:
"We must not let our rulers load us with perpetual debt."
John Adams, the one and only Federalist President, also warned in his first address to Congress:
"The consequences arising from the continual accumulation of public debts in other countries ought to admonish us to be careful to prevent their growth in our own."
The Republicans expect the federal government to honor the founding charter on which this country is based. That includes passing a budget, which the US Senate has failed to do for the past three and a half years. Two Senators have come up with one comprehensive compromise to get the government moving on entitlement reform. Independent Senator Joe Lieberman (I-CT) and Republican Senator Tom Coburn (R-OK) cobbled together a much more effective compromise bill which would raise the age of retirement on Medicareand adjust the deductible for office visits slightly higher. Senate Majority leader Harry Reid killed this bill before it went to the Senate floor for an up or down vote.
US Senator Chuck Schumer (D-NY) proposed raising taxes on millionaires as opposed to small business owners, who are barely getting by with more than $250,000 a year gross income. Even House Minority leader Nancy Pelosi shared her support for such Senator Schumer's compromise. In the latest round of negotiations, House Speaker John Boehner offered a tax increase on millionaires allowing with comprehensive entitlement reform, including long-term adjustments to raising the retirement age for Medicare and allowing lower cost of living adjustments for Social Security.
President Obama rejected this proposal, the same one championed by two liberal Democratic leaders in the House and the Senate. If President Obama and the Democrats in Congress are refusing to deal on entitlement reform and cut spending, then they do not deserve any deal at all.
Compromise cannot be "let's spend more money that we do not have, but not as much as before." Compromise must start with every representative in Congress making this pledge: "I will cut from my pet projects and yours, and among all other leaders in Congressto get out nation back on track." Congressman Mick Mulvaney (R-SC) has declared his willingness to cut military spending, not just defense spending. He was even willing to make his case on the liberal-leaning "Chris Matthews" show. There is room for compromise based on principle and wisdom.
However, leadership in the Democratic Party is willing to go over the fiscal cliff. Speaking for the White House, Treasury Secretary Tim Geithner signalled their own acquiescence for going over the cliff if they did not get the terms which they sought from Republicans. No matter what happens, entitlement reform must be enacted, whether responsibly based on calculated cuts, or by necessity because of the country's indebtedness, followed by bond markets unwillingness to continue serving the national debt.
This country can respect the interests and investments of previous entitlement beneficiaries, yet the government must also provide a program which will decrease the federal government's pilfering the entitlement funds without any regard for the future. Compromise must mean cutting spending, not more revenue. Tax increases on "the wealthy" are tax increases for everyone. The rich paying their fair share will lead to everyone having to pay for this "fair share" because of diminished investment, higher costs for goods and services, inflation, and joblessness.
If President Obama will not compromise on tax increases for millionaires, then he has sent the message loud and clear that he is not willing to compromise at all.
House Speaker John Boehner: Enough is Enough! Call President Obama's Bluff!
If the federal government ends up going over the fiscal cliff, then next year the Democrats will have to propose a different set of tax cuts and spending cuts, or prepare to witness markets shift dramatically and watch a possible second recession set in. Instead of Democrats playing the blame game, Republicans will be able to argue that they proposed principled tax increases which would not harm small businesses, job creators, or working Americans who still want to see less government in their lives.