The Bush tax cuts obliterated the Clinton budget surplus and combined with the two major wars, the prescription drug benefit, the recession, and the stimulus to create the deficit.
Therefore the biggest step toward reducing the deficit is to let the Bush tax cuts expire. BUT those cuts went very deep - affecting the majority of earners - while benefiting high earners the most.
Therefore the biggest step toward reducing the deficit is to let the Bush tax cuts expire. BUT those cuts went very deep - affecting the majority of earners - while benefiting high earners the most.
So the big issue of the 2012 campaign which begins now with the Super Committee's end - will be which Bush tax cuts will be allowed to expire. If NOTHING is done they all expire: so everybody gets a tax increase.
xpostfactoid: Was the Budget Control Act a 60-yard punt for Obama?:
by Andrew Sprung
"Nor do you have to credit Obama with playing multidimensional chess to think he may have achieved his chief goal at relatively modest cost. As the debt ceiling deadline approached, he drew one line in the sand -- not, as his allies craved, getting some mix of revenues into any deal, but rather gaining the power to raise the debt ceiling enough to last until 2013 without any further hostage taking scenarios. If you assume that a) Obama wanted a deal that included at least as much in cut spending as the Budget Control Act mandates [$1.2 trillion]; b) he is willing to live with the large defense cuts if he can't renegotiate them on his own terms; c) he will finally make a firm stand on the Bush tax cuts in 2012, insisting on either a restoration of the Clinton era top marginal rate or tax reform that provides more revenue than just that sunset would yield; and d) once Boehner backed out of the summer deal, a good outcome was impossible without and until Obama's reelection... then maybe he tacked his way to the lowest risk/highest yield strategy available to him."
'via Blog this'
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