December 18th, 2012

The fiscal cliff negotiations ad nauseam

I’ve not reported on those interminable fiscal cliff negotiations for a while, have I? I’m leaving it to others for the moment.

Why? It’s one of those post-election nightmares that was easy to foresee, and seems like a losing proposition, especially with Boehner in there. I have seen very little about him throughout his entire tenure that would earn my confidence; I’m sorry to say he seems like a mediocrity at best. It’s a terrible thing to have him as negotiator for the GOP (note I didn’t say for conservatives), kind of like a slow-motion train wreck that’s going at about 5 miles an hour and yet can wreak a great deal of damage.

Another reason I find it hard to report on this is that the ins and outs are a sort of theater (although not an entertaining one) that only really matter at the climax: what will the final agreement be? My guess: not at all good.

So if you have a stronger stomach than I, feel free to talk about all of this here.

[ADDENDUM: Steven Hayward of Powerline defends Boehner. Interesting. He may even be correct.]

31 Responses to “The fiscal cliff negotiations ad nauseam”

  1. M J R Says:

    We drove over the cliff long ago. The present debate centers on how hard we will land.

    Deck chairs . . . Titanic . . . get it?

    I will say I am mildly amused at how many take it so seriously — Boehner, Geithner, etc. I’m gratified they’re interested in making the landing as soft as possible — really — good for them, and they do have the country’s interests at heart [although Boehner's also interested in reelection].

    But the ^spending^ problem didn’t start with Dubya or even with Reagan, and won’t be mitigated in the least by the incumbent. Even Paul Ryan’s plan continues the spending, but at a more moderate rate of increase.

    Remember, in Washingtonese, if we’re currently spending $10 billion, and the new budget calls for $13 billion, but it gets “slashed” to $12 billion — that’s a $2 billion increase, ^except^ in Washingtonese, where it’s a $1 billion cut.

    In the immortal words of Uncle Walter Cronkite, “and that’s the way it is.”

  2. M J R Says:

    Is this part of a possible outcome in the USA? . . .

    http://www.nytimes.com/2012/12/17/world/europe/in-spain-having-a-job-no-longer-guarantees-a-paycheck.html?partner=socialflow&smid=tw-nytimesbusiness&_r=0

    For Spaniards, Having a Job No Longer Guarantees a Paycheck
    By SUZANNE DALEY
    The New York Times
    December 16, 2012

  3. Sam Random Says:

    In my [liberal] view: it would seem that, in the long term, conditions favor the conservative cause, really. The focus on deficit and debt reduction works within the framework of the present deleveraging process to effect currency deflation. That in turn exacerbates the already serious inequality of wealth distribution, and the social instability that comes with it. Which is all just to say, once social security and medicare are done away with, people will have to rely on the private sector for their needs, thereby circumventing democracy and finally achieving a dominion of liberty free of the rule of the masses.

    Obviously, that isn’t how other people here might describe the proceedings over the austerity bomb (aka fiscal cliff). Still, it seems to me that, overall, conservatives are winning here. There is an insistence on matching the rise in taxes to cuts in spending, which is really absurd–but it doesn’t matter, because the public barely understands whats going on anyways. But in the meantime, the recession will continue, and there will be relentless pressure on practically everyone to cut back, and eventually, people will stop asking for things like equality and justice and just settle for subsistence and be grateful, and then maybe, just maybe, conservatives will be satisfied and relax for a change.

  4. M J R Says:

    Sam Random!!!

    How the hell are ya???

    There were/are a few unswered questions/issues from the last time we-all powwowed.

    http://neoneocon.com/2012/12/13/racism-is-only-racism/#comments

    Whaddaya say?

  5. M J R Says:

    unanswered

  6. Sam Random Says:

    Hey, so I went back and looked over the discussion, and I think I found the questions in question, something about Michelle Malkin or something. Don’t take it personally if I don’t respond to something, I’m trying to be reasonable about the amount of time I have to commit to this, and what time I do have is often fleeting, so if I can’t think of something worthwhile to say or don’t have time to write, then that must do. My apologies if you felt neglected. Looking over the discussion now I feel as if perhaps I left a bit prematurely, however, it was unavoidable, so there it is.

  7. Oldflyer Says:

    Random Sam, where do you come up with statements such as ” But in the meantime, the recession will continue, and there will be relentless pressure on practically everyone to cut back, and eventually, people will stop asking for things like equality and justice and just settle for subsistence and be grateful…”?

    Let’s look at what you said, starting at the beginning.
    *The Democrats told us the recession was over thanks to Obama’s policies. Are you claiming that it isn’t?
    *By relentless pressure to cut back, are you referring to government, or to personal financial management? As far as government is concerned, here in California the legislature immediately embarked on a spending spree as soon as the new tax increases were voted in. At the federal level, Obama is whining that new spending is need to stimulate.. With regard to personal management, some of us cut back long ago to conserve resources.
    *Finally, what does any of this have to do with liberty and justice? I would say that government efforts to confiscate more from those who earn to spread to those who don’t qualify as impacting liberty and justice; but I doubt that is what you mean.

    Neo. I have corresponded with Boehner’s office to express two opinions.

    First, there is no legitimacy to a process in which he cuts a deal with the President. We have a whole structure, and a whole set of laws that deal with budgeting. We should use it.

    Secondly, no matter what else, there can be no increase in the debt ceiling. Whatever is done should be aimed at reducing debt immediately. I would prefer to seem him embrace sequestration.

    I have no illusions that my opinion would matter even if it were noticed. But, I am driven to try.

  8. Kae Arby Says:

    Like you Neo, I’ve grown tired of this farce, but I’ll go you one further; this isn’t just theater, it’s Kabuki. There are two other things that really sour me on these quote/unquote “negoitiations” is a) this is the christmas season and I really like to keep a positive attitude (which is difficult enough this year for obvious reasons) and b) If there is any sort of agreement it’s going to be reached at, if you’ll pardon the cliche, the 11th our. Since the deadline is January 1 that means we have two more weeks of this to go through.

    I’ll leave with one other thought. What we have are two people, Boehner and Obama, negoitating this nation’s “budget” (for lack of a better term for it) in private, with most likely no outside input or oversight, and if an agreement is reached, it’ll be presented to both houses of congress for a straight up or down vote. Is this how a representitive democracy is supposed to work? Because, to me, this sounds more like an autocracy.

    KRB

  9. M J R Says:

    Sam Random, 3:16 pm — not taken personally at all; for me, personally, there were no unaddressed issues. But I recalled there were many from other posters. Surely we can leave it to them if they want to take you up on anything.

    Actually, thank you for responding!

    Anyway, carry on . . . and thanks for apologies, no need for that at all (see initial paragraph). I’m newly retired, so I have more time than you, and I remember less-than-fondly what it was like working full time for decades on end, sans the luxury of having sufficient time.

  10. Sam Random Says:

    Oldflyer: I will start with your criticisms. 1) Yes, technically we are not in a recession, however, we are still in a liquidity trap, which means we are likely to go back into a recession unless demand increases significantly. 2) Yes, I am referring to cutbacks Federal, State, local, personal, corporate, etc. Here in crazy leftist loony land we refer to that as “lack of aggregate demand.” 3) liberty and justice are subjective terms, meaning they don’t mean the same thing to you as they do to me, or even to other people, and there’s nothing you can do about it.

    And how do I come up with those statements? From listening to people like you, who express alienation and disenfranchisement and disgust towards the government, and demand that the debt ceiling not be raised under any circumstances. I do not believe that you understand what the consequences would be if the debt ceiling was never raised again and that was seriously enforced. As you say- there cannot be a legitimate solution.

  11. M J R Says:

    Kae Arby, 3:39 pm — Kabuki. ^Exactly^. The (or at least “a”) word I was looking for earler.

  12. roc scssrs Says:

    Maybe Sam is right. We should all relax and let math run its course and reality have its nasty way. We can raise taxes and hope that Democrats will do something sooner rather than later. Maybe it’s a Nixon-to-China thing. Only Nixon could go to China and only Democrats can cut spending.

    And Sam, if you think we have social instability now, just wait till you see what eliminating benefits on a massive scale and/or runaway inflation will do. The sooner we start, the less drastic it will be.

  13. thomass Says:

    Sam Random Says:

    “There is an insistence on matching the rise in taxes to cuts in spending”

    Not really what is going on. No amount of sustainable tax raises could fund this spending ergo the necessity of spending cuts. Run along back to your usual preening sanctimony now. But on the ride back; consider republicans do well with a large middle class. Democrats in areas with large class divisions…

  14. fiona Says:

    Can Sam provide some data on the “inequality” – preferably of more recent vintage than 2007. By extending the period under discussion, say to 2009/2010, it is my understanding that we will see far less inequality, which may be why we don’t see this time period included very often.

    Lack of aggregate demand = everyone with any sense is trying to pay down their debt because of the instability of employment. Except of course for the recent graduates whose college debt now exceeds the consumer debt of the rest of the US. Besides, consumer spending at 70% of GDP is unsustainable – we are only beginning to see the consequences of this. Supplying the missing portion thru government indebtedness is going to be a neverending exercise. Rip the bandaid off now, instead of peeling it off in excruciating slow motion.

  15. Sam Random Says:

    According to the Economic Policy Institute’s website, between 1979 and 2011, real income accruing to the top 1% has risen 134%, while that of the bottom 90% has risen only 14.5%. Between 2007 and 2009, the income of the top 1% did decline, however, since then it has been on the rise again. There are many economic indicators of recent vintage that will demonstrate the long term growth of income and wealth inequality in the United States. There is no reason why this trend should not continue without significant change in macroeconomic policy.

    The thing is that it’s not a process with a clear end- you can’t “rip off the band-aid” and be done with it. Deflation is a cycle that keeps going until it starts to go the other way. A policy of austerity is a conscious choice, not a recognition of some particular reality. Economic growth is not the product of government retrenchment, nor will it be. As long as the legislature keeps the US fiscally constrained through the debt ceiling (and under Boehner that seems like a reasonable assumption to make), we can expect to stay in a cycle of deleveraging.

  16. parker Says:

    “Maybe Sam is right. We should all relax and let math run its course and reality have its nasty way.”

    Have no fear, the math will have its nasty way. Romney was at best a possible space in which to tip toe back from the abyss. That is not possible now. I see no point in attempting to negotiate with BHO as he has no intention to negotiate. Let taxes rise, raise the debt ceiling, do not reform entitlements, run up another trillion plus annual deficits in 2013 & 2014. But make sure you let the American people know this is BHO’s economy.

    Meanwhile investigate F&F and Benghazi, those are the issues to use to scratch the teflon surface of the messiah.

  17. thomass Says:

    Sam Random Says:

    “According to the Economic Policy Institute’s website, between 1979 and 2011, real income accruing to the top 1% has risen 134%, while that of the bottom 90% has risen only 14.5%. ”

    None of this information has anything to do with the problem I presented. We can’t tax anyone enough to pay for our current spending. Our current spending is locked on a course to continue rising for the baby boom generation’s retirement. As a cherry on top; the government has already spent the savings we ‘set aside’ for social security and medicare and put IOUs in the box.

  18. Sam Random Says:

    Bummer.

  19. Otiose Says:

    Sam your view on these problems is entirely within the Keynesian assumption framework. You likely believe that spending by either the government or the private sector equally stimulates economic growth. That there is something called a multiplier and that deflation and deleveraging are always bad. You probably also believe that we must continue to accumulate debt in order to continue ‘stimulating’ the economy to get out of the deleveraging trap we’re stuck in.

    Today’s Keynesianism is based on being able to add new debt which is the fuel keeping the expansion – credit expansion going. When there’s temporary problem the Keynesian lowers interest rates (to get people and everyone else) borrowing again.

    The problem -even if the expansion due to favorable demographics and initial low debt levels feels good and seems to ‘work’ – is that eventually levels of debt accumulation are reached that cannot be repaid.

    The Keynesian response to this – depending on which is more politically expedient – is to either default outright or covertly (inflation). Either way there are real losses suffered by someone to the benefit of others. In this particular case savers/investors lose while people who borrowed excessively and unwisely (unless they understand they are living in a Keynesian controlled economy – then it can be more of a shrewd calculation) gain.

    The inequality stats you point to are occurring for many reasons – a big one is that they are resulting from the distortions induced by the global application of Keynesian policies.

    And actually you can ‘rip off the band-aid’ and achieve great results. What we need is a retrenchment of government – i.e. a significant cutting of government spending and transfer payments in order to leave more money in the hands of the private sector. The reason is that economic value is not by and large created by government spending. Spending itself does not create value. It matters very much how it is spent and in most cases most of the time when private parties have the money and deploy it they are more likely than not to create something others value. But not always. There’s a constant Darwinian screening out of the unsuccessful attempts to create value – a sorting of the good from the bad – a process that cannot be applied to government spending which is dominated – no matter how well intentioned the government minions might be- by politics.

  20. Sam Random Says:

    Otiose: yes, my thinking on economics tends to be within a Keynesian or New Keynesian framework. And yes I think that one way to deal with a large amount of debt is to grow the economy, which will accompanied by moderate inflation, which will make the overall size of the debt smaller. The conservative consensus seems to be that this is not possible. On the other hand, it converted Bruce Bartlett.

    The solutions you recommend: would it not be easier and simpler to simply say “end social security and medicare”?

  21. parker Says:

    Sam Random,

    Your road, and the messiah’s road, is the road to serfdom. Many of us do not intend, even with the big gun of big government pointed at our heads, to place a toe on that road. There is so much you do not understand it is exasperating to know where to begin. For starters think about what stimulates the formation of real capital and think about what does and does not motivate people to be productive in the market place. You appear to have this death wish to keep reliving the 1930s over and over again. Groundhog Day gets tedious after the nth reiteration.

  22. parker Says:

    “we are still in a liquidity trap”

    Have you no clue as to how much ‘liquidity’ has been pumped out by the central banks over the last 4+ years? We have ‘liquidity’ out the yin-yang! Its resting on the ledgers of the too big to fail to cover the stink of their cooked books.

    “.. which means we are likely to go back into a recession unless demand increases significantly.”

    We never left the recession. Look around, we are teetering on the edge of a depression.

    “Yes, I am referring to cutbacks Federal, State, local..”

    Cutbacks? Aside from a few states where sanity prevails there are no cutbacks. Show me the federal cutbacks…… waiting, waiting, waiting.

    “… liberty and justice are subjective terms, meaning they don’t mean the same thing to you as they do to me, or even to other people…”

    Oh my, now you go down the rabbit hole.

    “I do not believe that you understand what the consequences would be if the debt ceiling was never raised again and that was seriously enforced.”

    As you are so full of understanding, please explain, without gibberish, the consequences. Begin by explaining how the federal government does not have the revenue to pay for outstanding debt/interest that is coming due. Here is a hint: you can’t because there is plenty of incoming revenue to pay for federal debt/interest that is coming due this quarter and the next. The rub is paying for the rest of the bloated budget.

  23. southpaw Says:

    As I’ve said ad nauseum, Boner would bend and lay down before Christmas. The long drawn out surrender was really unnecessary, as nobody expected anything else. The fact that he decided to drag us all through the charade as if it was fooling anyone, makes him look dumber than if he had simply said “I give up”.
    He let Obama toy with him like a cat playing with a ball of string. The House needs to get rid of this buffoon before he figures out what else he can give up to make the beatings stop.
    The only thing left for him to foul up is the debt ceiling. rumor has it he’s thinking if he lets Obama run with that, it will make him look smart.
    But this is what Boner has always wanted. Compromise and to make sure he and his followers get their share of the tax dollars and survive another term.

  24. Otiose Says:

    Sam, there’s a fascinating book by Haidt – The Righteous Mind – in which he points out that ‘liberals’ have much more trouble understanding the point of view of ‘conservatives’ than vise versa. I’ve noticed that Keynesians are afflicted with this same problem probably because their point of view is so widespread and dominant and they cannot imagine anything outside their framework.

    1) I have no doubt that you believe ‘one way to deal with a large amount of debt is to grow the economy, which will accompanied by moderate inflation, which will make the overall size of the debt smaller.’, and

    2) you believe ‘conservative consensus seems to be that this is not possible’.

    The reason we have a large amount of debt is that the Keynesian point of view has been in control since WWII using debt and credit expansion to ‘stimulate’ the economy, which as been consistently accompanied by (usually in the US) moderate inflation. The problem with this is that there is a cost while these policies are being undertaken not to mention the very severe costs when the credit expansion cycle has run its course and the Keynesian solution of default/inflation is undertaken in earnest. Even moderate inflation depresses growth and causes distortions in the allocation of resources that are also not cost free.

    The way to grow the economy is to cut government spending in order to leave resources to be deployed by more efficient owners to resume/continue sustainable value creation patterns.

    I don’t know about the ‘conservative consensus’ but IMO the Keynesian proposal that we must continue accumulating new debt and continue spending in order to somehow get growth going again is deeply flawed and obviously so. That line of thinking leads to silly statements by the likes of Pelosi that spending more on unemployment insurance will stimulate growth, or Obama’s nonsense that expanding more government jobs will grow the economy, or citing the growth in food stamps as a positive stimulus.

    I’m not sure why you bring up Bruce Bartlett. For my part I used to be a devout Keynesian, but I noticed anomalies with the worldview and looked for interpretations that could explain the facts better.

    As for ending social security and medicare – there are some extreme libertarians who probably advocate they be cut completely, and then there are others who favor aid to poor with heavier reliance on market based approaches.

    I keep an open mind and given the political situation at best we will have to push/modify such existing programs towards solutions that are more pro-growth.

  25. Otiose Says:

    And as to the topic itself,

    I disagree re: Boehner being a mediocre negotiator.

    I suspect it’s very possible he knows exactly what he’s doing and tho it’s high risk its a viable strategy.

    It may be he’s concluded that pretty much no matter what he concedes at this point Obama will not agree/compromise. Obama wants to trigger the cliff and thinks he will win the resulting blame game.

    Boehner seems to be maneuvering to shift the blame with the general public when that happens. He’s publicly bending over backwards with concessions while asking for what the public (or most of the public) knows is reasonable – some sort of reform now on the runaway spending/debt accumulation.

    If he succeeds if we go off the cliff and Obama gets the blame the political situation will shift suddenly and dramatically and the GOP will be in a much better position to negotiate when Obama feels forced to the table and off balance mid 2013.

  26. Oldflyer Says:

    Whoa Sam. You say that I express alienation and disenfranchisement because I believe in and support Constitutional government, and government spending within a defined budget arrived at through the established process.

    Well, you are right with respect to my feeling disenfranchised by a senate that does not bother to consider a budget for over three years; and a President from the same party who does not even chide them for this unlawful negligence.

    You are right that I am alienated by a government in which spending is so profligate that we have added more to our debt in four years than we had in many decades. This massive debt has accomplished nothing positive. This debt, for which we have no plan whatsoever other than to push it to future generations, simply dwarfs anything that Keynes or any other sentinent Economist could have imagined.

    Yes, I say freeze the debt limit. I do not have the economic jargon at my command that you have, but I do know that we can do that. I know that we must do that. Events of just this day with respect to the Sandy relief bill, prove that there is no alternative. Politicians must have their ability to borrow removed forcibly. I served for 25 years of service with the federal government, and I know that for every dollar that is pulled from the economy, a large percentage is swallowed by inefficiency and waste, if not outright fraud. I know that the allure to spend someone else’s money is simply too strong. I know that there is no office or department that cannot function on less. I know that as long as money is available it will be spent profligately; I am tempted to say like a drunken Sailor, but, drunken Sailors have the decency to spend their own money.

    You profess to be a Liberal and you make it clear that to you that means bigger government and greater spending. If so, then you must take ownership of the past 40 or 50 years. Those are the years since the “War on Poverty”. The WOP, that initiative that has seen trillions of dollars flow through the government with the effect that the poverty level is higher than ever. The sum of the effort is the unintended consequences of creating a permanent underclass of alienated citizens, whose only ownership in our society is the handouts provided by government. Big government always creates unintended consequences. That is its most common end product.

    Please Sir, theories are meaningless here. There is a record. The Liberals own it, although they try very hard to deny ownership.

    In the face of demonstrated failure over the long term, the Liberal argument tends to sound much like the standard Marxist, or Fascist excuse. The same one that all failed Utopians offer. To wit: “The theories may have failed throughout history, but that was because the wrong people were in charge of implementing them. Now, now it will be different.” Oh, and companion cry, “Give us more time. Give us more of your resources”.

  27. parker Says:

    Unless federal spending is limited to annual revenues there is no way to grow the economy or pay off the debt. PERIOD. The sad sack sams of the left just don’t get this reality thingy.

  28. neo-neocon Says:

    Otiose: note the addendum to my post. It contains a link to an article you might be interested in.

  29. Sam Random Says:

    The odd thing, oldflyer, is that what I’m thinking about is not “more time”– what I’m thinking about is how to move the system forward by changing it the least. The concept of economic growth is underpinned by the Keynesian framework of interest, money, and employment. We could theoretically redefine economic growth to mean something other than the growth of the real GDP, for example, whatever happens when you pay off the national debt.

    Indeed- what would that really look like anyways? What if, to start with, we did not raise the debt ceiling at all. According to a report from the CBO dated august 22, 2012, the deficit under current law (that is, if we go off the cliff) will be $641 billion. In their alternative scenario, they project a federal deficit of $1 trillion, and show that the increased debt would mean higher employment in the short run. If we did not raise the debt ceiling at all this year, that would mean a shortfall of $641 billion to aggregate demand. The US economy would likely go back into recession, and, if nothing was done, stay there. And in the meantime, everything would get more expensive (the end of farm subsidies mean more expensive food, subsidies to state budgets push further cutbacks, no energy subsidies would mean higher utility rates), interest rates would rise, wages would go down, etc. It would be like now, only on a grand scale.

    On top of that, how do you think the rest of the world would react to the United States effectively refusing to execute it’s own laws for fear of spending too much money? When the superpower becomes hamstrung of it’s own accord, that’s the time to go to war. The Japanese just this week elected a prime minister who is eager to build up a defense force (and possibly renegotiate the pacifist treaty of 1947). China, and it’s new hardline government, is staring inflation and worker unrest in the face. Surely the temptation to agitate for war must be strong in Beijing. The Middle East is ready to metamorphose into the ninth circle of Hell. And here we are with our pants around our ankles, unable to decide whether to pull them up or put on a different pair.

  30. southpaw Says:

    Otiose,
    If Boehner succeeds in getting anything besides getting mocked by the media for giving in to Obama, the steak is on me. I’m betting he not only agrees to raise taxes, he settles for a future discussion on spending cuts, hands over the debt ceiling to Obama for a year, and still manages to get blamed for the inevitable recession and inflation. The problem with your assumption is you presume the general public agrees on what is reasonable and that it will be discussed in that light by the media. Regardless of what offers, all of the blame for a bad economy will be leveled on his House, and he’s demonstrated an monumental ineptness at public relations or other media relations to change any perceptions or misconceptions about Republican polices or intents. Couple that with a stubborn and misguided belief that conservatives are the problem in his party, and I can’t see how Bohner manages to do anything except continue to humiliate himself.

  31. Otiose Says:

    neo / southpaw…

    neo thanks for referring me back to that PowerLine Post by Hayward – I pretty much agree with his assessment.

    southpaw, I have to say I don’t share your opinion on Boehner. So far he seems to me to have managed the two wings of Republicans reasonably well considering their differing approaches despite sharing some broad assumptions – it’s an uneasy alliance made possible only by the more extreme differences with Pelosi/Reid/Obama Dems.

    Obama is not Clinton. Clinton was so fracking dangerous because he grew up in a conservative environment and could get inside the heads of conservatives and their positions in order to take positions that were cunningly designed to split his opponents. That’s not Obama. He does not credit the conservative viewpoints (as broad and varied as they are) with any validity. To him all conservatives are ignorant / misguided and in need of his guidance and if they won’t accept his generous offer of enlightenment he’s very willing to hammer them into submission and no doubt sleep well at night too.

    Boehner seems capable and he’s been talking to Obama directly. The publicly observable actions he’s been taking do not seem to be out of panic but very deliberate. To paraphrase Hayward – tactical retreats to prepare the ground for larger victories ahead.

    For example, Boehner’s adoption of Pelosi’s position (of some time back – she not longer holds that position) on tax increases seems a very adroit tactical move to draw Obama out and to impress upon the public (aka the mob) how agreeable how reasonable how willing to compromise he and the Republicans are.

    And Obama so far seems to be playing according to Boehner’s script. Obama should take his very substantial victory, claim all the credit in fact even as he forces Boehner to stand next to him at the signing of legislation for lots more taxes and modest entitlement reforms. That would be devastating and split the Republicans.

    Instead Obama is demanding even more. My guess is that Obama either wants total surrender by the Republicans or he will go for the cliff and then believes he can destroy the Republicans by heaping all the blame on them.

    Boehner isn’t about to surrender everything and knows we’re going off the cliff shortly. He’s best move now is to make sure the Republicans do not take the blame.

    He will continue to offer tax increase but only in exchange for real spending cuts / entitlement reform to stop/slow the gushing deficit spending/debt accumulation. That’s a position most of the public would agree with.

    Obama has his Keynesian economists telling him that the combined effects of Bernanke’s QE and the continued fiscal deficit spending will ignite some serious growth which will redeem his policies of the last four years. I suspect he sees himself as some combination of FDR/Reagan and he is about to collect his just rewards.

    Oh well we’ll see how this plays out but in the shorter term Boehner’s tactical moves at least have the real potential of transferring the greater part of the blame for the cliff to the Democrats and as an added bonus split the Democrats over spending issues. Boehner’s concession on taxes effectively puts the ball to the other side and forces them to respond on spending cuts.

    Hayward puts it well:

    “It may turn out that Boehner’s patience will be rewarded: having offered a grudging concession on taxes, we are starting to see that Democrats are fracturing over any serious spending cuts. If Obama can’t deliver Democrats, it will shatter the media meme that Republicans are the obstacle to any deal, and Democrats will suddenly become the final cause of going over the fiscal cliff.”

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Previously a lifelong Democrat, born in New York and living in New England, surrounded by liberals on all sides, I've found myself slowly but surely leaving the fold and becoming that dread thing: a neocon.
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