The Origins of the Fiscal “Cliff”

source:  A Very Different Lame-Duck: Lessons From 2010 – ABC News.

canstockphoto11084666The fiscal cliff is what we’re focused on,” Cantor spokeswoman Megan Whittemore said. “That’s what we need to get a resolution for.”

“Fiscal cliff” this “fiscal cliff” that; I am really getting tired of all the rhetoric. It is almost as if some evil empire dropped the “fiscal cliff” viciously into our laps. This reminds me of all the gloom and doom associated with Y2K. Does anyone remember that one.  That happened in 1999 when some wise guru decided that the world was going to end when the calendar turned to January 1, 2000. The reasoning was that computers would get the date confused with 1900 as we only use the last two digit in most of our year designations.  Of course when the date actually happened it was as mundane as the year before.  No the “fiscal cliff” wasn’t dropped down on us by some evil empire, it was a result of a big majority vote by those same folks in our congress that are so upset about it now.
I know that some of us have very short memories so I am going to give you a “history” lesson here less than two years old. The “fiscal cliff” is actually called the Budget Control Act of 2011. In July of that year our representatives in congress were hard at work trying to figure out how they could blame their opponents for the increasing deficits. Their solution, as usual, was for a committee to look into it. So they assigned their biggest thinkers to attack the problem. In order to give these guys an incentive they decided to pass a law of what would happen if they couldn’t come up with something that would get the votes.

Continuing on with our history lesson the super committee (now get ready for this) couldn’t decide on how to do it so the Budget Control Act of 2011 is scheduled to kick in next month.  Both side are now very upset that they could have been so stupid to pass this law. The GOP says it will result in the end of the world if the job makers have to pay more of their huge incomes in taxes. The Democrats say it will cause millions of people to die in the streets. Both sides are screaming that our military will cease to exist if they must cut their huge over bloated budgets by ten percent!  Here is what I have to say about all of that.

 Poppycock!!!

The world will not end; the super rich will go on being super rich; our military will hardly feel the effect as their budgets are many times more than they actually to keep us “safe”.  We need a new moniker for the “fiscal cliff”. The best I have heard is to call it the “fiscal curb”. Yes, if we unknowingly step off this curb we might get a quick jolt but it would be nothing we can’t recover from and in the end it just might be the best thing to happen.

We need to somehow learn as a government to live within our means and to pay for what we need. This fiscal curb might just do the trick if our seemingly spineless representative have the guts to just let it happen.

But I’m just a simple guy so what do I know….

5 thoughts on “The Origins of the Fiscal “Cliff”

  • Honestly, I want to put my head in a hole and just come up sometime next spring! When the news media begins talking about how much more taxes WE will pay I am stunned. But if we need to do that, then so be it.

    The thing that really bothers me is the rich guy that I found that was bragging that he paid NO taxes. He could donate enough while vacationing and partying and use his good times as a deduction. When you have enough money, things are a great deal easier.

    So let reality begin. I do think that they will get this little blip fixed. If not, life goes on.

    b+

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  • If that weren’t bad enough, on top of the expected Federal taxes and benefit cuts, our state (Minnesota) is now predicting a deficit of $1.1 billion by summer even without the cliff. Without an agreement in Washington we could got to $2.8 billion. Talk of some high state gas taxes, more and higher sales taxes, and severe cuts in services. Minnesota companies would then be likely to shed workers and plunge us into recession. Arguing and finger pointing is rampant of course. Anyway, that’s the worst prediction I’ve heard so far for us…I don’t know whether to believe it all or not. Sometimes, I feel like I’m being played for a chump.

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  • Hi Barb, thanks for the comments. Yeah that gets me also how some of these 1%ers brag about not paying any taxes and there are reports that about 1200 of them are in this category. As you say they take one “client” on a trip around the world and then write it off as a business expense. Thanks for the url to the tax cut scenarios; I will check them out.

    Jane, I too have heard some pretty dire forecasts. One article said it would cost $3,000 per household but a more reputable source claims $800. But even if we let all of them expire I think most of the cuts for the 98% will be re-established come January 1. It would be political suicide for the Republicans to not go along. I just hope Obama doesn’t cave in as easily as he did the last time….

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