Tuesday, December 04, 2012

Dumb, Dumberer, Dumberest

By Carl 

You'd think after having their asses handed to them in the November elections, Republicans might be a little more... flexible.

And you'd be wrong. The Great Orange Satan -- No, not Kos, the other one -- has stopped crying long enough to lash out at working Americans:

U.S. House Speaker John Boehner proposed $2.2 trillion of spending cuts and new revenue that lack what President Barack Obama calls essential for a fiscal agreement: higher tax rates for top-earning Americans. 

Boehner, an Ohio Republican, yesterday called it a "credible plan that deserves consideration by the White House." The Obama administration promptly rejected the proposal, which would raise the Medicare eligibility age and slow Social Security cost-of-living increases. 

[...]

With the Republican blueprint, both parties now have their opening offers on the table. Nebraska Senator Ben Nelson, a Democrat, said the Republican plan signals "act two" in negotiations over the so-called fiscal cliff. "There will be an act three undoubtedly, and hopefully the distance between the bid and ask is closed," he said.

In fairness, at least one of the aspects noted above might make sense, in a perverse way: raising the Medicare eligibility age.

Look, people are going to have to work longer for a bunch of reasons (not least of which is the two major recessions that have triggered on the watch of President Bush, destroying 401(k)s), which means there is a good chance that they'll have private health insurance available to them under Obamacare. By delaying the port over to Medicare, the nation could save billions over time.

Of course, who relies on Medicare but the folks who weren't able to sock away shrinking wages for retirement.

Buried in the proposal is a signal that Republicans might consider a net hike in tax revenues (which I alluded to yesterday) but not a raise in rates. This would entail closing deductions like the home mortgage interest deduction (again, the hike would fall disproportionately on the middle class and destroy the housing market at a time it is already crippled, as it would discourage home buyers and deflate real estate prices, which fuel much of consumer spending).

The Bush tax cuts benefitted the wealthy overwhlemingly. These "tax hikes" would impact them even less, in my back-of-the-envelope view. The Republican Party is continuing guerrilla warfare on the middle and working classes.

Senator Nelson speaks of a middle ground compromise, but I can't see one that's possible unless the Republicans are willing to go at least 70% of the way and start priming the pump for tax increases: actual rate rises, liek the capital gains and carried interest rates. Those cannot be made permanent or we doom the middle class to a life of servitude to the corporatocracy.

Money should have utility that exceeds the utility it has to use money to make money for a pool of investors.

(Cross-posted to Simply Left Behind.)

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