The Fiscal Cliff Approacheth

[Direckshun]

In an effort to make this thread sticky-worthy, I am going to update this OP to keep casual glancers informed.

This post is the official one-stop shopping of the key points/developments of the fiscal cliff negotiations.

Far as I understand, the fiscal cliff:

1. Gets rid of the Bush tax cuts for the wealthy.
2. Gets rid of the Bush tax cuts for everybody else.
3. Slashes defense spending by something like $500 billion.
4. Slashes domestic programs like the NIH, Head Start, and medicine/drug care for the poor by $500 billion.

The new idea is for Democrats to allow the cliff to hit, then immediately introduce a bill that would bring 2, 4, and some of 3 back. But not 1.

Here is a chart detailing exactly what the fiscal cliff is going to do, financially:

Spoiler!

Originally Posted by Direckshun

New CBO projection: if the fiscal cliff hits, we are in another recession, and lose two million jobs.

http://www.reuters.com/article/2012/...87L0JV20120822

The poor would be hurt by the fiscal cliff:

Originally Posted by Direckshun

Overall, if the tax breaks from the 2009 stimulus are allowed to expire—the EITC and Child Tax Credit expansions, along with American Opportunity Credit for college tuition—the poorest 20 percent of Americans would see their taxes go up by $209 on average, reducing their after-tax income by 1.9 percent, according to the Tax Policy Center.

As would the middle class:

Originally Posted by Direckshun

According to estimates by the Tax Policy Center, more than half of all married couples will owe an additional tax of around $4,000 unless Congress acts. And more than a third of families with children will fall subject to the AMT, with parents of three or more children facing an extra tax of $4,700.

Among married couples with at least two children and adjusted gross income between $75,000 and $100,000, the center estimates that 84 percent will face a significantly higher tax bill this year because of the AMT.

There seems to be some consensus between the parties that substantial revenues want to be raised. Boehner and the GOP hopes that's through limiting tax deductions rather than tax raises.

Obama's opening offer, essentially:

• Allow the Bush tax cuts on high earners to expire. $849 billion
• Limit itemized deductions to 28 percent, close some loopholes and deductions on high earners, eliminate tax breaks for oil and gas companies, eliminate the carried interest loophole, plus a few other items. $584 billion
• Create a special "Buffett Rule" tax rate for millionaires. $47 billion
• Restore the estate tax to 2009 levels. $143 billion
• Limit corporate income shifting to low-tax countries. $148 billion
• Other miscellaneous tax increases and reductions. About -$200 billion
• Total: $1.6 trillion

[Direckshun]

Boehner's and the GOP's stance that revenue must come from closing loopholes and limiting deductions is bad for certainty:

On the one hand, you could tell people hitting that $250,001 income level that the only new tax they're going to pay is a slightly higher rate on income at and above that level. On the other, you tell them that their rate will remain in limbo, but they will be hit, at some point, by the elimination of loopholes. Which loopholes? We'll find out later!

[petegz28]

Originally Posted by Direckshun

Boehner's and the GOP's stance that revenue must come from closing loopholes and limiting deductions is bad for certainty:

Translation: The Left won't be happy until they raise taxes on the rich becasue that just sounds good.

[petegz28]

Originally Posted by Direckshun

Boehner's and the GOP's stance that revenue must come from closing loopholes and limiting deductions is bad for certainty:

In fact, the fact that Obama and the Dems won't even entertain any thoughts without raising taxes on someone just proves what idiotic, morons they are and that they don't necessarily care about raising revenue but moreso saying they "stuck it to the rich".

Repubs: Mr. President, we have a plan to raise revenues without raising any taxes for anyone.

Obama: NO! Raise taxes on the rich or I'm not talking to you.

Dems: Yea! What he said!

Repubs: But we can raise revenue without raising taxes. What does it matter if we raise the revenue if we can do it withour raising taxes??

Obama: I said tax the rich!!

Dems: Yeah, what he said!

[Direckshun]

Originally Posted by petegz28

Translation: The Left won't be happy until they raise taxes on the rich becasue that just sounds good.

It's more certain.

Uncertainty is depressing our unemployment rate by a full percent.

[petegz28]

Originally Posted by Direckshun

It's more certain.

Uncertainty is depressing our unemployment rate by a full percent.

Since when have you or anyone one the left cared about uncertainty? You certainly haven't for the last 4 years!

You schmucks will sell your own mothers if it somehow justifies you raising taxes.

Face it. The Left has never been serious about getting anything acomplished other than getting their way. There are ways to raise revenues without raising taxes but no, they don't want to hear it. All they care about is raising taxes because they said they would raise taxes and even though that may not be the best route to fix things, god damn it, they are going to do it because that's what they want!

[Direckshun]

Originally Posted by petegz28

Since when have you or anyone one the left cared about uncertainty? You certainly haven't for the last 4 years!

You schmucks will sell your own mothers if it somehow justifies you raising taxes.

I don't think you know how uncertainty works.

[Direckshun]

Financial Times reporting that tax increases on capital gains are on the table.

[petegz28]

Originally Posted by Direckshun

I don't think you know how uncertainty works.

Sure, sure. This coming from the guy who had to post a thread on why corporate profits are so good, etc.

You're a tool when it comes to economics. Always have been, always will be.

[petegz28]

Originally Posted by Direckshun

Financial Times reporting that tax increases on capital gains are on the table.

FTR, I have long been in favor of raising capital gains taxes but not for revenue growth. When Bush cut the CG tax we saw additional volatility in the markets. A higher tax on CG's encourages longer holding periods of investments, imo, and helps smooth out some of the volatile trading.

[Direckshun]

Originally Posted by petegz28

Sure, sure. This coming from the guy who had to post a thread on why corporate profits are so good, etc.

You're a tool when it comes to economics. Always have been, always will be.

This is all good information.

[Direckshun]

Originally Posted by petegz28

FTR, I have long been in favor of raising capital gains taxes but not for revenue growth. When Bush cut the CG tax we saw additional volatility in the markets. A higher tax on CG's encourages longer holding periods of investments, imo, and helps smooth out some of the volatile trading.

That's fair.

[RaiderH8r]

Originally Posted by Direckshun

Obama inherited the worst deficit in American history, and cut it faster than anybody has cut a deficit since WW2.

In a recovery from a recession.

I'll take that against anybody's record on deficits in modern American history.

Yeah, inherited from himself. Stop blaming Bush. Hell, McConnell offered to vote Obama's proposal n the floor of the Senate and Reid couldn't rush to the floor to stop it any faster if he tried. Face it. The President is a bum and a coward. He will kill himself to avoid taking a stand or a leadership position. He will sit like a petulet child and snipe down idea after idea never offering anything of substance lest he be held accountable for his own shitty governance and policies.

[Direckshun]

Good news today, apparently Boehner has leveraged the election victory and his punishment of super-conservative Republicans to getting the GOP caucus as firmly behind him as its ever been.

That will only help him negotiate more aggressively in cliff talks.

[Direckshun]

AP also has some info on how you could delay the cliff.

All of it is essentially from the President's side.

[Mr. Flopnuts]

Originally Posted by donkhater

Clinton had the benefit of being president during the .com bubble. Then proceeded to recall Glass-Stengell and set up the housing bubble with the Community Reinvestment Act that led to mortgage back securities that were at the heart of the 2008 crash.

But Clinton was above all this wasn't he?

Absolutely. It's taken both parties on numerous levels to get us to this state. We need a 3rd party. One that's exclusively aligned with the middle class of this country. Let's call it The Average Joe Party.